Portugal

Capital city: Lisbon

Currency

Euro (€, EUR)

Language spoken

Portuguese

Population size

10,276,617

Payroll frequency

Monthly

VAT – standard rate

23%

GDP – growth rate

2.145%

Portuguese labour law is not contained under a single law. The main sources are the Portuguese Constitution which sets forth fundamental rights and principles regarding both employees and employers, European legislation, the Portuguese Employment Code and the Regulation of the Employment Code. Furthermore, collective bargaining agreements as well as individual agreements also play a role.

The vast majority of rules stipulated by the Portuguese Employment Code are mandatory and cannot be modified either by collective bargaining or agreement of the parties. All workers in Portugal are protected by Portuguese employment law.

Employing in Portugal requires employers to own a legal entity in the country and manage payroll, tax, benefits and compliance through their own in-country resources. The complexity of employment regulations in Portugal makes full compliance with employment laws a burdensome process.

Remotepayroll will take care of payroll, tax, benefits and compliance so you can focus on what matters most — your people.

Besides providing your employees with all statutory benefits in Portugal, Remote can advise on and arrange for custom benefits and perks for your employees upon request.

Minimum Wage

Minimum Wage: €741 per month in 12 payments; €635 per month in 14 payments for full-time workers, rural workers, and domestic employees ages 18 and older.

EU Blue Card

An EU Blue Card gives highly-qualified workers from outside the EU the right to live and work in an EU country, provided they have higher professional qualifications, such as a university degree, and an employment contract or a binding job offer with a high salary compared to the average in the EU country where the job is.

For Portugal, the gross annual salary resulting from the monthly or annual salary specified in the work contract or binding job offer must be equal to or higher than the relevant salary threshold defined by the Member State (at least 1.5 times the average gross annual salary in the Member State concerned).

For 2021, Portugal set the minimum salary threshold at: 665 EU per month, this means that the minimal gross annual salary should be €11.970,- which is €997,50 per month.

Taxes in Portugal

Learn about employment taxes and how they affect your employees’ paycheck

Employer

Employee

14.5% - Up to 7,112
23.0% - 7,112-10,732
28.5% - 10,732-20,322
35.0% - 20,322-25,075
37.0% - 25,075-36,967
45.0% - 36,967-80,882
48.0% - 80,882 and above

Portugal collects an additional solidarity rate between 2.5-5% on income that exceeds €80,000.