Europe · Company formation

Company formation in Madeira (Portugal)

This suits founders who want an EU, onshore Portuguese company with a genuinely low headline tax rate. They need to commit to real Madeira substance, meaning staff and activity, to qualify for and defend the 5% MIBC regime.

Last verified July 2026

At a glance

Entity
Private limited company (Sociedade por Quotas, 'Lda'); the distinctive route is an Lda licensed under the Madeira International Business Centre (MIBC / Zona Franca)
Corporate tax
MIBC-licensed companies: 5% CIT on eligible international-source income (licences until 31 Dec 2026, benefit guaranteed through 31 Dec 2033). Non-MIBC companies based in Madeira: 14.7% regional CIT (11.9% on the first EUR 50,000 for SMEs), plus regional surtaxes on profits above EUR 1.5M. As of 2026.
Incorporation time
A plain Lda can be formed same-day via 'Empresa na Hora' if a signatory attends in person, or ~3-7 business days via 'Empresa Online'; realistically ~2-4 weeks for a non-resident once NIF and power of attorney are arranged. MIBC licensing adds further lead time.
Minimum capital
EUR 1 per quota (EUR 1 for a single-member Unipessoal, EUR 2 for two members). The former EUR 5,000 minimum was abolished; MIBC substance conditions, not capital, are the real bar.
Resident director
No resident director required. The company is run by one or more 'gerentes' (managers) who may be non-resident foreigners of any nationality. MIBC status, however, requires genuine local substance (activity carried on from Madeira and job creation).
Audit
Statutory audit by a Revisor Oficial de Contas (ROC) is required only if the company exceeds two of three thresholds for two consecutive years: balance-sheet total EUR 1,500,000; net turnover EUR 3,000,000; average 50 employees. Most small Ldas are exempt.
Remote set-up
Yes. No notary is required. A non-resident first obtains a Portuguese tax number (NIF) remotely, then grants a power of attorney to a Portuguese lawyer/solicitador who incorporates via Empresa Online using a qualified digital certificate. In-person 'Empresa na Hora' requires physical attendance.
Government fee
EUR 360 for 'Empresa na Hora' (on-the-spot) or 'Empresa Online' with bespoke articles; EUR 220 for 'Empresa Online' using pre-approved model articles. MIBC licensing and annual fees are charged separately by the SDM concessionaire.
Best for
This suits founders who want an EU, onshore Portuguese company with a genuinely low headline tax rate. They need to commit to real Madeira substance, meaning staff and activity, to qualify for and defend the 5% MIBC regime.

The process

  1. Obtain a Portuguese NIF (tax number) for each foreign shareholder/manager and appoint a Portuguese lawyer or solicitador under power of attorney
  2. Reserve a company name (Certificado de Admissibilidade) or pick a pre-approved name, and prepare articles of association
  3. Incorporate the Lda via Empresa na Hora (in person) or Empresa Online, paying the state fee and registering with the commercial registry, tax authority and social security
  4. For the 5% rate, apply to the Sociedade de Desenvolvimento da Madeira (SDM) for an MIBC licence and then meet the job-creation / investment substance conditions
What can go wrong
  • Hard deadline: new MIBC licences granting the 5% rate can only be issued until 31 December 2026 (benefits then run to 2033); after that the regime's future depends on EU state-aid renewal, which is not guaranteed.
  • The 5% rate is not automatic - it demands real substance (e.g. 1-5 jobs within 6 months plus EUR 75,000 in fixed assets, or 6+ jobs) and is capped annually as a share of gross value added, payroll or turnover; a shell company will not qualify.
  • This is an onshore EU/Portuguese company with full CSC compliance, Portuguese accounting, VAT and reporting obligations - lower tax, but not a low-admin offshore vehicle; non-eligible/domestic income is taxed at the ordinary Madeira rate, not 5%.

Form a company in Madeira (Portugal)?

One named person on the file, an honest read on tax and substance, and a fixed quote before you commit.