Establishing yourself as a self-employed worker in Portugal can be an advantageous choice for many professionals, especially in a constantly evolving job market. This regime allows for greater flexibility, freedom and, in many cases, greater earning potential. Furthermore, the associated tax framework offers options that can be adjusted to the needs and reality of each worker.
Main Advantages of Being Self-Employed
Freedom and Autonomy
As a freelancer, you can manage your schedule, choose your clients, and define the projects you want to work on. This level of freedom is ideal for those who value autonomy in making professional decisions.
Potential for Higher Income
Unlike formal employment, where income is fixed, independent workers have the ability to adjust their prices and expand their client base, which can result in higher income.
Diversification of Work Areas
Being self-employed allows you to explore different areas of activity. This flexibility is a huge advantage, especially for multi-faceted professionals who want to diversify their knowledge and services.
Deductible Expenses
One of the benefits of the tax regime associated with self-employment is the possibility of deducting expenses related to professional activity, such as travel, work materials, training, and even part of the home expenses (if used as an office).
Simplicity in Simples Nacional
For workers who fall under the simplified regime (annual income of up to R$200,000), tax calculation is simplified, based on a percentage of income presumed as profit, facilitating compliance with tax obligations.
Access to the VAT Regime
Depending on the activity and annual income, the worker may benefit from VAT exemption under Article 53 of the CIVA (if annual income does not exceed €15,000). This exemption reduces administrative and financial costs associated with VAT management.
Possibility of Business Growth
For self-employed workers looking to expand, it is possible to evolve into a sole proprietorship or form a partnership. This growth is a natural step for many professionals who start out as freelancers.
Tax Structure Associated with Self-Employment in Portugal
The tax regime for self-employed workers is divided into two main frameworks:
Simplified Regime
Intended for workers with an annual income of up to €200,000.
Income is taxed based on a percentage assumed to be profit (typically 75% for most activities, but can vary).
Possibility of automatically deducting part of the expenses related to the activity.
Organized Accounting Regime
Recommended for workers with an income of over €200,000 or for those who have high and specific expenses to deduct.
Requires the hiring of an Official Accounting Technician (TOC).
It allows you to deduct actual expenses more broadly, making you more tailored to high-cost activities.
Furthermore, all self-employed workers are required to contribute to Social Security. In 2024, the contribution rate is 21.4% on the relevant income, but there are exemptions or reductions applicable for the first months of activity.
Conclusion
Being a self-employed worker in Portugal is an excellent option for those seeking professional freedom, greater control over income and flexibility in work management. However, it is essential to pay attention to tax and social security obligations, ensuring that the activity is properly classified.
When exploring this option, it is best to seek advice from an accountant or tax expert to ensure you are making the most of your chosen scheme.
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