How to Declare the Start of an Activity
Whether you are resident or non-resident, if you want to carry out self-employed work in Portugal, you must first declare the start of your activity with the Finance department.
This includes anyone who plans to rent out their holiday home as tourist accommodation (Alojamento Local).
Where to go
The request to start an activity is done verbally at your local finance office (Finanças).
There is also the option to go online and fill out the Declaração de Início de Atividade form yourself through the Portal das Finanças, however, it is vital that the information you provide is 100% correct as it will have a direct impact on your tax and VAT obligations.
To view the Declaração de Início de Atividade form, click here.
Required documents
Passport/ID
Fiscal Number (NIF)
Bank details: NIB (for a Portuguese bank) or IBAN number (international banks)
To find out how to get a Fiscal Number (NIF), click here.
Required Information
Type of activity (and corresponding CAE code)
Start date
Estimated monthly income
Accounting regime
What is a CAE code?
The CAE code is used to classify the self-employed activities listed in the table referred to in article 151 of the IRS Code.
For Alojamento Local, your activity will fall under CAE 55201 (Furnished accommodation for tourists) or 55204 (other places of short-term lodging).
Which accounting regime to choose?
If your estimated annual income is less than €200,000, you can choose either the Simplified Regime or Organised Accounts. Most people choose the Simplified Regime, where your deductible expenses are calculated automatically when filing your annual tax return.
Organised Accounts means hiring a certified accountant (TOC), licensed to practice in Portugal who will take care of your tax returns. This method allows for all expenses to be recorded and deducted accordingly on your annual tax return. An accountant will charge at least €50 per month.
VAT
Your estimated income is used by the Finance department to determine whether or not you are exempt from charging VAT. Those who earn less than €10,000 per year are exempt (source: Article 53 of the CIVA code).
Those who exceed €10,000 will be obliged to charge VAT at the prevailing rate and fill out periodic VAT declarations through the online Finance Portal, where a document is subsequently issued to pay VAT.
