Starting a Business in Madeira: Is It a Good Option for Digital Nomads? — Andy Sto

Why Choose Madeira to Setup Your Company?

  • High rates of economic growth
  • A sustainable socio-political situation
  • A developed transport infrastructure
  • A low crime rate
  • Reasonable prices for real estate, goods and services
  • A wonderful attitude towards foreign investment from the authorities
  • A modern banking sector
  • The opportunity and freedom to hire skilled labour
  • There’s no long waiting periods for obtaining a business visa — it takes about 20 days
  • A visa-free regime for the Schengen zone
  • A loyal and beneficial tax system
  • Low cost of living when compared to other locations, with good quality of life
  • Highly evolved IT technology infrastructure, which is great for the nomadic at heart.

The Business Benefits of Setting up a Company in Madeira

  • Get to enjoy a free economic zone regime
  • Setting upa company in Madeira is not a vastly difficult process.
  • Enjoy the best corporate tax rates in the whole of Europe
  • Enjoy a flat-tax rate of 20% on professional income derived from value-adding activities such as those performed by software developers, authors, journalists and linguists, creative artists, executive managers, commercial directors, IT specialists.
  • There’s also exemption on funds received from all foreign companies. To fully understand these tax-related benefits and how they benefit the more nomadically-inclined worker, read on to be enlightened regarding taxes in Madeira.

Enjoy Great Tax Benefits in Madeira

  • The reduced corporate income tax rate on income is applicable to international business activity.
  • Exemption from Real Estate Transfer Tax (IMT) and Municipal Property Tax (IMI) for properties exclusively applies to the company and respective parties.
  • Exemption of tax on salaries received from foreign companies is applied
  • All active income tax is reduced to 5%.
  • Exemption from withholding tax on the distribution of dividends.
  • Relief from tax on interest, service fees and royalties paid to non-residents.
  • Exemption from property transfer tax, property tax, stamp duty, and regional and municipal surcharges.

Company Forms in Madeira: Which One To Choose?

  • Limited Liability Company (Tax-Resident LLC)
  • Local Limited Company (Madeira LLC)
  • A company with 100% foreign capital
  • A company in a special industrial zone (Madeira IBC/Santa Maria FTZ)
  • Joint Stock Company (PLC/SA)
  • A limited liability company and Golden Visa (Golden Visa LLC)
  • A Representative Office (ER).
  • Public joint-stock company (SA);
  • Private joint-stock company (LDA).

Procedure: The Basics of Starting a Business in Madeira

  • The main legislative act regulating business activities in Madeira is called the “Company Act in Portugal”.
  • The establishment of a company requires at least 5 shareholders, either natural persons or legal entities. The residency is irrelevant.
  • The minimum amount of authorized capital must equal or exceed € 50 000.
  • At the moment of registration, 30% of the abovementioned amount should be paid as a deposit of sorts.
  • Issue of registered and bearer shares is permitted. The latter should be paid in full. It is possible to re-issue shares in accordance with the norms of Portuguese legislation and the company’s charter.
  • The company should also form reserve funds, the amount of which is 20% of the authorized capital.
  • The company registrar in Madeira provides will provide official approval of all registrations.
  1. Compile application for the Registrar of Companies for the purpose of obtaining permission to use the company name.
  2. Contribute minimum capital to the local bank account in advance.
  3. Register the company with local tax authorities, and notify the Financial Department concerning obtaining a taxpayer’s card.
  4. Register the company with the Social Security Administration, as well as the Commercial Register.
  5. If non-residents of Madeira are employed at the enterprise, the application regarding registration of employment agreements must be submitted to the Ministry of Employment.
  6. Company owners are expected to publish the contents of the company’s Charter in the local newspaper.
  7. Accounting books should be registered in the Commercial Register and with the tax authorities. And speaking of tax, we have some more good news for foreign business enthusiasts wanting to start a business in Madeira, in the section below.

More About The Magical Madeira Remote Lifestyle



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