Hiring international talent is increasingly common in Portuguese companies, but it involves specific considerations for documentation, tax framework, and Social Security. See what your company needs to know.
Documentation and authorisation to work
The first verification is the right to work in Portugal. Citizens of the European Union and the European Economic Area have freedom of movement. Citizens from third countries generally require a residence permit or a visa that allows them to perform work activities.
NIF and NISS
Like any worker, a foreign national needs a NIF (Número de Identificação Fiscal - Tax Identification Number) and a NISS (Número de Identificação da Segurança Social - Social Security Identification Number) to be hired and make contributions. The company must ensure these numbers are processed before the start of the activity.
Tax framework and residency
Taxation depends on tax residency. A resident in Portugal is taxed on their global income; a non-resident is only taxed on income obtained in Portugal and according to specific rules. Double taxation treaties are crucial in these cases.
Social Security and secondment
Workers seconded from another country may maintain their country of origin's Social Security for a certain period, with the appropriate document. Outside these situations, Portuguese contributions apply.
Equality of rights
Foreign workers have the same labour rights as national citizens: remuneration, holidays, allowances, and social protection. The company must ensure this framework.
Precautions to take
Confirming the validity of residence permits, keeping documentation organised, and correctly framing tax residency avoids problems with the Tax and Customs Authority (Autoridade Tributária) and the SEF (Serviço de Estrangeiros e Fronteiras), now AIMA (Agência Portuguesa para as Minorias, Migrações e Asilo).
At Grupo Your, we support companies in the hiring and framework of foreign workers, from the initial document to payroll processing. Talk to us before hiring.
