Opening a Bank Account & Managing Your Taxes in Portugal

Jump right in:

• How to Open a Bank Account in Portugal?
• Tops Banks in Portugal
• What is the Tax System in Portugal?
• What is the Income Tax on Salaries in Portugal?

How to open a bank account in Portugal

In this section, we cover how to open a bank account in Portugal as an expat. We explain what documents you’ll 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 you 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, some may let you complete the entire process remotely, while others still require a visit to the branch in person to finalize it.

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 ● your 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 (in some cases, you may be required to provide this)

If you’re 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, but you will need to obtain a Portuguese tax number (NIF) beforehand.

Top banks in Portugal

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

● Caixa Geral de Depósitos ● Millennium 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 also home to branches of some 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 ● Millennium 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 possible, especially with digital banks, but you will usually need a Portuguese tax number (NIF) to complete the process.

Bank fees and minimum deposit

Portuguese banks typically charge a monthly fee for their banking services. The Portuguese typically spend between 80 and 130 EUR (approx. 90–150 USD) per year on bank fees. In reality, this is unnecessary. There are several options for 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 CTT ● Banco BPI ● Best ● BNI Europa

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 offer no-fee accounts with no mandatory minimum deposit. You can open a basic account without having to transfer any initial amount.

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.

NIF: Getting a Portuguese tax number

You first step is 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 to the Autoridade Tributária e Aduaneira (commonly known as Finanças) the Portuguese tax authority. If you’re applying for a NIF as a non-resident, you will need proof of address for your last country of residence (a bank statement should suffice) and a tax representative. This representative must be a Portuguese citizen or a legal resident who has lived in Portugal for at least two years, and they are responsible for receiving any communication from the tax authorities.

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 9.1% to 48%. If you make less than 12,180 EUR (approx. 14,200 USD) per year, you are generally exempt from paying income tax due to the minimum existence threshold. The highest tax rate applies to anyone making more than 81,200 EUR (approx. 95,000 USD) per year.

Portugal has 7 tax brackets for individual taxpayers. The types of income subject to taxation include employment, self-employment, business activities, capital gains, investment income, rental income, and pensions.

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’ll be getting in Portugal.

Annual income (EUR)

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 1 April and 30 June 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.

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 main tax regimes for self-employed workers in Portugal, and the one that applies to you depends on the type and scale of your activity.

Sole traders and freelancers

Those working in Portugal as freelancers or sole traders must pay income taxes, known as the IRS (Imposto Sobre o Rendimento das Pessoas Singulares). This means the revenue they make from this type of activity is considered income and is taxed as such, although the calculation method may differ from that of employees depending on the applicable tax regime.

Business owners

If you open a business, such as a limited company, partnership, or cooperative, you’ll 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 o Rendimento das Pessoas Coletivas). The current rate of IRC is 21%.

How to pay taxes if you are self-employed

If you’re self-employed, you’re responsible for filing your own taxes, which includes both income taxes and social security. You’ll have to submit quarterly income declarations to social security and the annual tax return including 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.