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How Much Red Tape for Sole Trader type business?

How Much Red Tape for Sole Trader type business?

Old Sep 22nd 2013, 5:42 pm
  #1  
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Default How Much Red Tape for Sole Trader type business?

Hello,
I have been researching running ones own business in Portugal and I have seen a lot of really negative things about this, an Algarve based website particularly makes for grim reading. I hear about red tape, regulations etc.

Then on the other hand, I read exciting things about startups in Lisbon, and agencise that help this such as Startup Lisboa.

So it would be really interesting to know anyone's experiences? I do things on a freelance/sole trader scale, mainly computer internet work. I also plan to teach workshops in a premesis I might get. I guess the former is relatively easier than the latter?

So anyone? Is it really not worth thinking about Portugal if one is self employed? Or is the red tape an obstacle but not so bad for small scale self employed.

Thanks!
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Old Sep 23rd 2013, 6:49 am
  #2  
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Default Re: How Much Red Tape for Sole Trader type business?

If you are tax resident you can invoice through the " green invoice scheme " and your employer/customer can pay you Gross.
If not PT tax resident the employer/customer has to deduct 25% tax at scource which you offset against your UK tax.
If PT tax resident remember that the VAT threshold is very low around 10.000euros turnover.
If PT tax resident after your first year of trading you will have to pay social security monthly even if you have no income.
I know individuals who have fallen foul of this,.
EG someone who was on a commission only arrangement, his employer registered him with the Financas, two years later he got a bill foe 2000euros social security even though he had virtually no earnings during the first 12 months.
One of the biggest complaints against PT governement is that it stifles start ups. I have not heard of the organisation you mention, I would check that it is an official body .
Good luck, hard work should always be rewarded.
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Old Sep 23rd 2013, 3:24 pm
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Default Re: How Much Red Tape for Sole Trader type business?

Hi thanks for information -
I am not sure http://startuplisboa.com/ but it seems very helpful information on website and a good community.

The social security payments is not good, in Spain is similar.
You said-
'If PT tax resident after your first year of trading you will have to pay social security monthly even if you have no income.'
So basically if you become self employed there, you must put away about 200 or 300 euros a month to pay the social security?
I guess its ok if you live here enough to get the state pension, if it exists by then! lol.
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Old Sep 24th 2013, 6:18 pm
  #4  
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Default Re: How Much Red Tape for Sole Trader type business?

There are all kinds in initiatives and some assistance with the registration and set-up documentation. However keeping all the things you need to do covered and paid on time means you will certainly need to get the help of a reliable (bilingual) accountant from Day 1. Unless the business plan supports the cost of this then you should think again about even starting.

Having said that I think there has never been a better time to start something so good luck with your plan.
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Old Sep 24th 2013, 6:38 pm
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Default Re: How Much Red Tape for Sole Trader type business?

Thanks for info,
I think as well economic doldrums are a good time to start things.
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Old Sep 24th 2013, 6:38 pm
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Default Re: How Much Red Tape for Sole Trader type business?

Thanks for info,
I think as well economic doldrums are a good time to start things.
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