Simplify Your Social Security Contributions in Portugal with Tytle
Dealing with social security contributions in Portugal can be difficult for expats. At Tytle, we provide expert support to help you understand your obligations and manage your contributions, making the process easier and more straightforward.
Social Security Contributions in Portugal: Common Issues
For expats, understanding social security contributions in Portugal can be overwhelming. From residency requirements to fluctuating rates, several factors can make the process confusing.
Confusion over Residency Rules: It can be unclear how your residency status affects your contributions.
Uncertainty about Contribution Rates: The different rates for employees and self-employed individuals can be hard to understand.
Lack of Clear Guidance: Expats often struggle with knowing which social security system they should be part of, especially if they have multiple income sources.
Difficulty with Reporting and Payment: Managing the paperwork and deadlines for social security payments can be complex, leading to missed contributions or fines.
How Tytle Can Help with Social Security Contributions in Portugal
At Tytle, we simplify social security contributions in Portugal for expats. Our tax advisors guide you through residency rules, contribution rates, and compliance. We handle paperwork, meet deadlines, and file necessary documents to ensure timely payments and avoid penalties. Additionally, we provide full support for all tax-related matters, allowing you to settle into life in Portugal with ease.
Social Security Contributions in Portugal: What Expats Need to Know
For expats, understanding social security contributions in Portugal is crucial for compliance and access to healthcare, pensions, unemployment benefits, and family allowances. These contributions are mandatory for employees and self-employed individuals and are calculated based on income.
Employee Social Security Contributions in Portugal
Employees contribute 11% of their monthly salary, while employers pay 23.75% of the employee’s gross salary. These contributions cover benefits such as family, pension, and unemployment benefits. Employers handle payroll deductions, but employees should ensure accuracy. In addition to social security contributions at a general rate of 23.75%, employers must take out insurance to cover occupational accidents..
Self-Employed Social Security Contributions in Portugal
Self-employed expats in Portugal generally contribute 21.4% of their relevant income to social security. Those with lower earnings may qualify for a reduced rate. Under the simplified tax regime, the monthly contribution base is calculated as one-third of the relevant remuneration determined in each reporting period. The relevant remuneration is based on 70% of income from services rendered and 20% of income from the sale or production of goods.
Members of the Board
For board members (administradores e gerentes) in Portugal, the standard social security contribution rates are 9.3% for the individual and 20.3% for the employer. However, if board members are classified as managers or administrators with management authority, the contribution rates increase to 11% for the individual and 23.75% for the employer.
Social security contributions for board members are calculated based on their actual remuneration, but they are subject to a minimum monthly contribution base of EUR 522.50.
Social Security Benefits in Portugal
Contributions provide access to pensions, healthcare, and unemployment benefits. Expats who meet the required contribution years may qualify for pensions and unemployment support. Healthcare benefits are available in case of illness or injury.
Tax Considerations: The Non-Habitual Resident (NHR) Regime
Expats may benefit from the NHR regime, which offers tax advantages to qualifying individuals like a 10% tax rate on foreign pensions for up to 10 years. However, eligibility is more restricted under the revised NHR 2.0 regime and these benefits are currently unavailable to most new applicants.
Totalization Agreements: Avoiding Double Contributions
Portugal’s totalization agreements, including with the US, may prevent expats from paying social security contributions in Portugal and their home country in some situations. Expats only contribute to one country's system based on residency status.
Important Information for Foreign Workers
Companies can hire foreign workers without a NISS number. An employment contract is required to assign one.
Youth PIT and Performance Bonuses
The Youth PIT (IRS Jovem) rules now apply to young workers up to 35 years old and exempt a portion of their income for up to 10 years. Performance bonuses paid voluntarily by employers are exempt from IRS and social security contributions up to 6% of the worker’s annual base salary.
Compliance and Deadlines
Contributions are due between the 10th and 20th of each month. Staying on top of deadlines is essential to avoid penalties. Every year, the Portuguese Social Security establishes a tax calendar to inform residents and business owners in Portugal about the legal deadlines for fulfilling their tax obligations in 2025.
Our Tax Services
Expert Guidance on Social Security Contributions
We provide clear explanations on how your residency status impacts your social security obligations and ensure you meet all legal requirements.
Self-Employed Contribution Support
Our team helps self-employed expats determine the correct contribution rate and assists in reporting income accurately to avoid penalties.
Social Security Filing Assistance
We manage the filing of all necessary social security documentation, ensuring contributions are submitted correctly and on time.
NHR Regime Tax Advice
If you qualify for the Non-Habitual Resident (NHR) regime, we guide you through its tax benefits and help minimize your tax liability.
Avoiding Double Contributions
We assist expats covered by totalization agreements to ensure they only contribute to one country’s social security system and avoid redundant payments.
We Provide Tax Support in the Following Countries
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How We Work
Fill out a short questionnaire
Simply answer a few questions about your tax requirements, and Tytle’s expat tax advisors will assist you with expert advice, filings, planning, bookkeeping, and more.
Be connected with a Tytle non-resident tax consultant
We’ll match you with the right expat tax advisor and provide an upfront price estimate. No need to worry about cross-border issues—that’s our specialty!
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Once you approve, our tax expert will begin working on your case. Have any questions or concerns? Feel free to contact us.
Tytle will do the rest
Keep all your documents organized and archived in your personal dashboard. Stay on top of deadlines and never miss important communications from tax authorities.
Who Are We?
Tytle provides tax services for over 30 countries, including the EU, UK, US, Brazil, and parts of Asia. Our team, consisting of more than 50 experienced tax advisors, offers a wide range of services, from tax planning and filing to bookkeeping and audits.
With a proven reputation for excellence, Tytle is dedicated to simplifying tax management, ensuring a smooth and stress-free process.
The goal is to ensure full compliance, optimize tax situations, and accelerate the tax process whenever possible. Our specialization lies in handling complex tax issues, such as double taxation and dual reporting, for individuals and businesses operating across borders.
Tytle ensures that clients are paired with the right tax advisor, offering transparent fees and timely support, no matter where in the world they are located.
Why choose Tytle?
At Tytle, we offer comprehensive services to help expats manage their social security contributions in Portugal, ensuring compliance and maximizing benefits.
At Tytle, we simplify the process, ensuring compliance and maximizing efficiency, so you can focus on what truly matters.
Our approach is straightforward: we listen, understand, and offer clear, actionable solutions.
For individuals and businesses seeking dependable, simple tax assistance, Tytle is the trusted company you can count on.
Here is why:
At Tytle, we connect you with the right tax advisor to address your unique needs.
We take the time to understand your situation, providing clear, actionable guidance and proactive solutions to ensure you get the support you need.
From handling your taxes to securing your tax number, we make the entire process smooth, clear, and hassle-free, reducing filing time by up to 70%.
Our skilled tax professionals manage taxes with precision, offering competitive pricing and prompt, reliable service.
No hidden fees - just straightforward tax help.
Frequently asked questions
In general, employees contribute 11% of their gross monthly remuneration, while employers contribute 23.75%. These contributions cover family, pension, and unemployment benefits. Employers must also pay for an insurance premium to cover occupational accidents.
Self-employed expats in Portugal generally contribute 21.4% of their relevant income to social security. Those with lower earnings may qualify for a reduced rate. Under the simplified tax regime, the monthly contribution base is calculated as one-third of the relevant remuneration determined in each reporting period. The relevant remuneration is based on 70% of income from services rendered and 20% of income from the sale or production of goods.
Yes, companies are explicitly allowed to hire foreign workers even if they do not yet possess a Número de Identificação de Segurança Social (NISS). The employment contract is a prerequisite for assigning a NISS number.
The totalization agreement between Portugal and the US prevents expats from paying social security taxes to both governments. Which country you pay social security taxes to generally depends on how long you plan to live in Portugal. If you plan to live in Portugal for less than 5 years, you typically pay US social security taxes. If you plan to live there for 5 years or more, you typically pay Portuguese social security taxes.
Portugal’s popular Non-Habitual Resident (NHR) regime officially closed to new applicants on December 31, 2023. Those who were already registered retain their benefits for the full 10-year period, as long as they continue to meet the tax residency requirements in Portugal.
As of 2024, a new tax incentive program—often referred to as NHR 2.0—has replaced the original NHR regime. This new framework introduces stricter eligibility criteria and narrows the list of qualifying professions. While the original NHR provided broad tax benefits for foreign professionals, NHR 2.0 is more targeted, focusing primarily on individuals working in scientific research, higher education, technology, select healthcare professions, and senior management. Additionally, entrepreneurs involved in innovative start-ups may also qualify under the new regime.
To see a detailed breakdown of which professions qualify under NHR 2.0, check out “Portugal’s NHR 2.0: 7 Professions Eligible for a Reduced Tax Rate”.
The new tax regime is already in effect, though specific details may continue to evolve as the Portuguese government refines its implementation.
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