Freelancing in Portugal: recibos verdes explained

What you need first

• A NIF (tax number) and a password for the Portal das Finanças.
• A NISS (social security number). See how to get a NIF and a NISS.
• A Portuguese address on your tax record if you live here, so that you are treated as a resident.

Registering as a freelancer (abrir atividade)

You register online on the Portal das Finanças (the "declaração de início de atividade") or at a tax office. It is free and takes a few minutes, but the form is in Portuguese. You will be asked for:

• Your activity code (código CIRS or CAE). Most qualified services, such as consulting, IT, design, translation or engineering, are on the list in article 151 of the IRS Code. The code sets how much of your invoicing is taxed.
• Your expected invoicing for the year. Below €15,000 you can be VAT exempt (article 53).
• The tax regime. Almost everyone starts in the simplified regime (regime simplificado), with no accountant required.

Social security is informed automatically. You only start paying it 12 months after you first register.

Issuing invoices

Every time you are paid you issue a fatura-recibo (invoice-receipt) on the Portal das Finanças, free, or in certified invoicing software. The invoice shows the VAT, if you charge it, and the income tax withheld by Portuguese business clients. Clients abroad pay the full amount. The invoice calculator shows what to put in each field.

What you pay

• Social security: 21.4% of 70% of what you invoice, about 15%, declared every quarter and paid every month. Minimum €20 a month. Calculator.
• Income tax (IRS): on 75% of your invoicing for art. 151 professions (35% for other services), at the progressive rates, settled once a year in your tax return. Calculator.
• VAT: 23% on the mainland, only if you invoice more than €15,000 a year in Portugal. Services to foreign businesses carry no Portuguese VAT.

In the first two years the taxed share of your invoicing is lower (by 50% and 25%) if you have no other work income.

Your yearly calendar

• January, April, July, October: quarterly social security declaration.
• Every month, 10th to 20th: social security payment.
• 1 April to 30 June: income tax return for the previous year. See your first tax return.
• If you charge VAT: quarterly VAT return and payment.

Things that catch newcomers out

• Insurance: work accident insurance (seguro de acidentes de trabalho para independentes) is mandatory.
• Expenses: above about €30,600 a year in art. 151 professions, you need business expenses on e-fatura worth 15% of your invoicing, or part of the difference is taxed.
• Saving for tax: foreign clients do not withhold anything, so the whole year's income tax arrives in one bill. Put roughly 25% to 35% of each payment aside.

Rules for 2026: IRS Code (articles 31, 101 and 151), Contributory Schemes Code and VAT Code (article 53).