Back to the blog Business

Opening a company in Portugal: the essential first steps

28 April 2026 · Cosmopratico

Setting up a company in Portugal is faster than most people expect, if you take the steps in the right order.

Portugal is one of the more accessible countries in Europe to start a business. The administrative steps are well defined, but doing them in the wrong order, or with the wrong codes, can create problems that follow you for years. Here is the sequence that works.

1. Choose your legal form

Most newcomers choose between two options:

• Self-employment (Recibo Verde), the simplest route for freelancers and solo activity, with lighter obligations.
• A company (Sociedade, e.g. Lda), a separate legal entity, better suited to partners, employees or higher turnover.

The right choice depends on your expected income, your liability comfort and whether you'll have partners or staff.

2. Get your NIF (and a fiscal representative if needed)

Every founder needs a Portuguese tax number (NIF). If you are not yet a resident, you may need a fiscal representative to obtain it. This is the foundation for everything that follows.

3. Pick the right CAE code

The CAE is the official classification of your business activity. It affects your tax treatment, your obligations and sometimes your eligibility for certain regimes. Choosing it carelessly is a common and costly mistake, it's worth getting advice here.

4. Register the activity

You then open your activity with the Tax Authority (declaração de início de atividade) and, where relevant, register with Social Security as an employer or self-employed person.

5. Set up accounting and invoicing

Portugal requires certified invoicing software for most activities. Before you issue your first invoice, make sure your accounting setup is in place so your VAT and reporting are correct from day one.

6. Open a business bank account

A dedicated account keeps your business and personal finances separate, essential for clean accounting and, for companies, a legal requirement.

How we help

Cosmopratico handles company formation, Recibo Verde setup, CAE selection, accounting, tax filings and banking support, so you can focus on running your business while we keep it compliant.