Opening a Bank Account & Managing Your Taxes in Portugal

How to Open a Bank Account in Portugal

If you want to know how to open a bank account in Portugal as a non-resident, this section covers all the requirements and processes of getting your finances in order in Portugal.

We explain what documents you will need, what the process is like, and show you some of your options for banks, be it international banks, no-fee bank accounts, or online banking.

Can I Open a Bank Account in Portugal?

Yes, you can open a bank account in Portugal as a foreigner. For most banks, setting up a Portuguese bank account requires a visit to a branch. If your bank allows you to open an account online, you are still expected to visit the branch in person to finalize the process. If you open an account online from overseas, expect to have to visit the branch in person when you arrive in Portugal.

Read on to learn about the required documents to open a bank account as a non-resident as well as a resident.

Requirements and Documents to Open a Bank Account

To open a bank account in Portugal, you typically must provide

• a valid ID such as your national identity card or your passport;
• NIF, the Portuguese tax number;
• proof of address (e.g., recent bill or letter you have received in the mail in the past three months with your name and address visible);
• proof of employment (e.g., last payslip or a statement from an employer).

If you are not employed, you can still open an account in Portugal. However, in this case, you will want to bring a promise of a work contract or proof that you are registered with the Centro de Emprego, the Portuguese employment center.

If you are a non-resident, or are not in Portuguese territory, you may be able to open an account entirely online with no need to visit the branch in person.

Best Banks in Portugal

Below is a list of some of the biggest banks in Portugal:

• Caixa Geral de Depósitos
• Millenium BCP
• Novo Banco
• Banco BPI
• Banco Santander Totta

The standard working hours for banks in Portugal are between 8:30 and 15:00. This means banks are open during lunch hours, which is also their busiest time of the day. You may find some banks open on Saturday mornings as well.

International Banks in Portugal

The majority of banks in the country are Portuguese. However, Portugal is home to some branches of international banks. You can always opt for these banks and their banking products if you are looking for specific offers for expats:

• Abanca
• Barclays
• BNP Paribas
• Deutsche Bank
• ING Bank

Some banks from Brazil, China, or Angola also have branches in Portugal, so you may even find your current bank in the country.

Best Online Banks in Portugal

The following banks have both options for online banking and opening an account online:

• ActivoBank
• Banco N26
• Caixa Geral de Depósitos
• Millenium BCP
• Novo Banco

After you have submitted all the necessary documents (mentioned above), you are required to do a video call with the bank to confirm your identity—this replaces the bank visit. Opening an account online in Portugal as a non-resident is not possible, unless you have a Portuguese tax number (NIF).

Bank Fees and Minimum Deposit

Portuguese banks typically charge a monthly fee for their banking services. The Portuguese spend on average 60 EUR (66 USD) on bank fees a year.

In reality, this is unnecessary. There are several options of no-fee bank accounts in the country, although some banks offer more complete services than others.

The banks that offer no-fee bank accounts in Portugal are:

• ActivoBank;
• Banco CCT;
• Banco BPI;
• Best;
• BNI Europa;
• Caixa Geral de Depósitos.

Of this list, the most complete banking products are offered by ActivoBank and Banco CTT. While all have products free of charge, the other banks listed start charging fees under certain conditions (e.g, if you decide to open a current account with another bank, make a certain number of bank transfers, request a credit card, etc.)

Both ActivoBank and Banco CTT require a minimum deposit. ActivoBank sets that minimum to 250 EUR (275 USD), while Banco CTT asks for 100 EUR (110 USD).

What is the Tax System in Portugal?

Wondering what the tax system is like in Portugal? Find out how much of your income and other possessions are going to be taxed in the country, whether you are going to take up self-employment or work as an employee in the country.

NIF: Getting a Portuguese Tax Number

You first need to get a tax number in Portugal known as the NIF, Número de Identificação Fiscal. This is one of the first and most important registrations you must do in the country, as you will need a NIF for just about everything—opening a bank account, setting up utilities, getting a phone number, signing a contract, and so on.

To get a tax number in Portugal, you need to go Finanças, the tax agency. If you are applying for a NIF as a non-resident, you will need proof of address of your last country of residence (a bank statement should suffice) and a tax representative. This representative needs to be a Portuguese national and they become responsible for ensuring you pay your taxes.

If applying as a Portuguese resident, bring proof of your address in Portugal. In both cases, you will need your ID.

The Tax System in Portugal

Portugal has several types of taxes, the most relevant being income tax, social security, corporate tax, and value added tax.

You are considered a resident, and are taxed as such, if you live in Portugal for at least 183 days in a year.

What is the Income Tax on Salaries in Portugal?

Taxes on income in Portugal are known as IRS, Imposto sobre o Rendimento de Pessoas Singulares.

Portugal has a progressive tax rate on income—the more you earn, the more you are taxed. Tax rates go from 0 to 45.3%. If you make less than 654 EUR (720 USD) per month, you do not need to pay taxes on your income. The highest tax rate applies to anyone making more than 80,641 EUR (88,030 USD) a month.

So, what is taxable in Portugal? The following types of income are taxed in the country: employment, business and professional, investment, rental, capital gains, and pensions.

When it comes to tax brackets and rates, you should get ready for an extensive list. Portugal has 36 tax brackets, and that is for unmarried employees alone. Those percentages change depending on your marital status, and the number of dependent children you have. There are also separate tax brackets for people with disabilities, both married and unmarried.

Below is a table with simplified tax brackets. There are several tax brackets in between the ones listed here, so make sure to check the complete list where you can pinpoint the salary you will be getting in Portugal.

Annual Income (EUR) Annual Income (USD) Tax rate % Up to 7,091 Up to 7,830 14.50 7,092–10,700 7,832–11,817 23 10,701–20,261 11,818–22,376 28.50 20,262–40,522 22,377–44,758 37 40,523–80,640 44,759–89,076 45 Over 80,641 Over 89,088 48

How do You Pay Taxes in Portugal?

Taxes on your salary are withheld by your employer on a monthly basis. They pay the state directly, so if you are an employee, you do not need to worry about paying monthly taxes. However, you still have to file an annual tax return. This is done between April 1st and June 30th of the following fiscal year.

You can do this by accessing the Tax Agency’s website Portal das Finanças, where you should be registered. There you will find all the invoices that contain your NIF, which you must confirm and validate.

Tax Regime for Non-Habitual Residents

If you are a highly skilled worker who has not lived in Portugal for the last five years, you can apply for the special tax regime for non-habitual residents. With this regime, you are taxed a flat rate of 20% for up to ten years.

To apply for this regime, you must be considered a resident for tax purposes in Portugal and enroll electronically at the Treasury Portal as a non-habitual resident.

Taxes for the Self-Employed in Portugal

If you are going to take up self-employment in the country, you should know which type of taxes apply to your business. There are two types of taxes for self-employed workers, and the one you pay depends on the type of business you set up.

Sole Traders and Freelancers

Those working in Portugal as freelancers or sole traders must pay income taxes, known as the IRS (Imposto Sobre Pessoas Singulares). This means the revenue they make from this type of activity is considered income and is taxed as such, at the same rate as employees.

Business Owners

If you open a business, such as a limited company, partnership, or cooperative, you will have to pay both income taxes on your salary and corporate taxes on your company’s earnings. This corporate tax is known as IRC (Imposto Sobre Pessoas Coletivas).

The current rate of IRC is 21%.

How to Pay Taxes as Self-Employed

If you are working as self-employed, you are responsible for filing your own taxes, which includes both income taxes and social security. You will have to submit the trimestral tax return and the annual tax income, corresponding with Annex SS of Model 3 of the IRS.

You can pay your income taxes at Portal das Finanças and Social Security through Segurança Social Direta.

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