---
title: "Portugal"
id: "15279"
type: "employer-of-record"
slug: "portugal"
published_at: "2025-08-12T13:37:50+00:00"
modified_at: "2026-09-23T15:42:45+00:00"
url: "https://topsourceworldwide.com/employer-of-record/portugal/"
markdown_url: "https://topsourceworldwide.com/employer-of-record/portugal.md"
taxonomy_continent:
  - "Europe"
---

# Employer of Record in Portugal

Employ talent in Portugal without a local entity — the 23.75% Social Security (TSU), 14 salary payments, strict dismissal rules and payroll handled by local specialists.

[Get Started](https://topsourceworldwide.com/contact-us/)

## Why hire in Portugal through an EOR

Portugal is a fast-growing tech and nearshoring hub with attractive talent costs — but its payroll has distinctive rules: employer Social Security (TSU) at 23.75% with no ceiling, salaries paid over 14 months not 12, a mandatory annual training obligation, and no at-will dismissal. Through an EOR, all of it is already running.

### No entity required

Employ staff across Portugal, one of 164 countries we cover, without registering a Portuguese company or maintaining a local presence.

### TSU and 14 payments handled

Employer Social Security (TSU) is 23.75% of gross with no ceiling, and it applies to all 14 salary payments — not 12. We calculate and accrue both correctly, the single most common budget miscalculation in Portugal.

### The 13th and 14th month, on schedule

Portuguese employees receive a holiday subsidy (due before their holiday starts) and a Christmas subsidy (by 15 December), each a full month’s remuneration — not just base salary. These are statutory, not bonuses. We accrue and pay them on the required dates.

### Strict dismissal rules navigated

Portugal does not recognise at-will employment — dismissal needs a disciplinary process or a defined redundancy procedure. We issue compliant contracts and manage lawful exits.

### Working in days, not months

We employ your Portuguese hires through our established structure — they can be working in days, while your own entity is still waiting on tax numbers and a corporate bank account.

## Hire in Portugal without setting up an entity

Portugal has become one of Europe’s most attractive nearshoring and tech-talent markets — skilled, multilingual, and more affordable than Western Europe — but its payroll carries distinctive rules foreign employers routinely miss. Employer Social Security (the Taxa Social Única, or TSU) is 23.75% of gross salary with no ceiling, applied to every euro. Salaries are paid over 14 instalments, not 12: a holiday subsidy (subsídio de férias) and a Christmas subsidy (subsídio de Natal), each a full month’s pay, are mandatory. There’s a statutory 40-hours-a-year training obligation, and no at-will dismissal. The minimum wage is €920 a month (× 14 = €12,880 a year).

An Employer of Record removes all of it: TopSource employs your Portuguese hires with TSU calculated on all 14 payments, the holiday and Christmas subsidies accrued and paid on the statutory deadlines, IRS withheld, the training obligation tracked, and dismissal rules navigated. Hire into Portugal fast and compliantly.

[Talk to our Portugal team](https://topsourceworldwide.com/contact-us/)

## Calculate Your Employee Costs in Portugal

Enter a gross salary to see the full monthly cost of a hire in Portugal — 23.75% employer TSU across all 14 payments and the two subsidies included in your total spend per employee.

##### Employment Cost Calculator

*Indicative figures only and not definitive legal advice. Local regulations change frequently. [Consult an expert](/contact-us/)

##### Portugal

  Annually Monthly

|  | British Pound | Portugal |
| --- | --- | --- |
| Base Salary (per month) |  |  |
| Employer Contributions |  |  |
| Total Cost (Annual) |  |  |
| Total Cost (Monthly) |  |  |

Employer of Record services in [Learn more](#)
Payroll Outsourcing in [Learn more](#)

## How EOR in Portugal works: the process through TopSource

Step 1

### Confirm the role and structure

We agree the position and salary with you — clarifying base × 14 versus total cash, the #1 cause of contract confusion in Portugal — and confirm TSU and IRS treatment.

Step 2

### Issue a compliant contract

Your new hire receives a written employment contract under the Portuguese Labour Code (Lei 7/2009), with probation, working hours, the 14-payment structure and mandatory clauses set out.

Step 3

### Register the employment

We register the employee with Segurança Social by the time the contract starts — the statutory deadline changed on 1 January 2026 — and arrange mandatory workplace-accident insurance from day one.

Step 4

### Run payroll in EUR

We calculate salary across 14 payments, 23.75% employer TSU plus workplace-accident insurance, deduct the employee’s 11% Social Security and IRS, and remit — paying the holiday and Christmas subsidies by their deadlines.

Step 5

### Support the relationship day to day

Your account manager and the employee both have a direct line for contract questions, the subsidies, the training obligation, leave and anything else that comes up.

## Know your Portugal hiring costs before you commit

Tell us the role and salary — we’ll send back the full Portuguese employment cost, TSU on all 14 payments included, within one business day.

[Get a Custom Employment Quote](https://topsourceworldwide.com/contact-us/)

## Employer Costs in Portugal at a Glance

23.75%

Employer Social Security (TSU) on gross — uncapped

14

Salary payments per year (holiday + Christmas subsidies)

€920

Monthly minimum wage (× 14 = €12,880/year)

## Employer Costs in Portugal Explained

Portugal’s headline employer cost is Social Security (TSU) at 23.75% of gross salary, with no ceiling — it applies to every euro, and to all 14 salary payments, not just 12. Portuguese salaries include a mandatory holiday subsidy and Christmas subsidy, each a full month’s remuneration. Employees pay 11% Social Security plus IRS income tax, both withheld at source. The minimum wage is €920/month (€12,880/year over 14 payments), which puts a minimum-wage hire at just over €16,000 a year all in. Here’s the breakdown.

#### Employer Social Security (TSU) at 23.75%

The Taxa Social Única (TSU) is Portugal’s employer social-security contribution: 23.75% of gross salary, paid by the employer on top of pay. Unlike many countries, it has no ceiling — it applies to every euro, so a €100,000 salary attracts the full 23.75% just as a minimum-wage one does. Critically, TSU applies to all 14 salary payments, including the holiday and Christmas subsidies — calculating it on only 12 is the single most common and costly mistake foreign employers make. The employee separately pays 11%, withheld from gross, for a combined rate of 34.75% — a rate that did not change in 2026, contrary to what several payroll guides claim. Beyond TSU, the only other mandatory payroll charge is workplace-accident insurance, roughly 0.5-1% of payroll for office roles. There is no separate wage-guarantee levy on top: the Fundo de Garantia Salarial is funded from within the global rate. And the one charge that did used to sit on top — the Fundo de Compensação do Trabalho (FCT) at 0.925% — was abolished, Decreto-Lei 115/2023 having ended the obligation to contribute from 1 January 2024.

#### The 14-payment structure and the two subsidies

Portuguese salaries are paid over 14 instalments, not 12. In addition to twelve monthly salaries, every employee receives a holiday subsidy (subsídio de férias), typically paid before summer holidays, and a Christmas subsidy (subsídio de Natal), payable by 15 December — each equal to one month’s remuneration rather than one month’s base salary — the holiday subsidy covers base pay plus the regular components tied to how the work is performed, so a package with fixed allowances or regular commission costs more than base × 14 suggests. These are statutory entitlements under the Labour Code, not discretionary bonuses, and both are subject to full TSU and IRS. By written agreement up to half of each subsidy can be paid in twelve monthly instalments (duodécimos) instead of as lump sums, which some employers prefer for cash flow; the regime that allowed the full amount to be spread lapsed at the end of 2017. Either way, they must be budgeted from the outset — they’re why total annual cost is far higher than 12 × monthly salary suggests. We accrue them monthly and pay them on the statutory deadlines.

#### Dismissal, the training obligation and IRS

Portugal does not recognise at-will employment. Dismissal runs through one of four defined routes — fair-cause disciplinary proceedings, collective redundancy, extinction of the post, or unsuitability (inadaptação) — each with strict procedure. An unlawful dismissal entitles the employee to reinstatement or, at their own election, compensation in its place of 15 to 45 days’ pay per year of service subject to a three-month floor, plus damages and back pay from the dismissal to the judgment. The genuinely flexible window is the probation period, where either side can end the contract without cause or compensation. There’s also a statutory training obligation: 40 hours of certified training per employee per year — raised from 35 by Lei 93/2019, not by the 2023 reform as is often reported. Hours the employer fails to deliver within two years convert into a credit that then lapses after a further three, and anything outstanding is payable to the employee when the contract ends — a genuine hidden liability at scale. Employee income tax (IRS) is progressive across nine bands from 12.5% to 48%, withheld monthly; qualifying newcomers may access IFICI, the successor to the former NHR, which taxes qualifying employment income at 20% for ten years — and it is the employer, not the employee, who must confirm the conditions on the Portal das Finanças by 15 March. We handle dismissal process, the training obligation and IRS withholding.

#### Minimum wage, leave and working time

The national minimum wage is €920 a month for 2026 (over 14 payments, €12,880 a year), on a tripartite path toward at least €1,020 by 2028 — an agreement between the government and the social partners rather than legislation, so plan for annual increases. Madeira sets €980 and the Azores €966. Statutory paid annual leave is 22 working days, and the 13 national public holidays sit on top rather than eating into it. Working time is capped at 8 hours a day and 40 a week. Parental leave is generous and, importantly for budgeting, paid by Social Security rather than by the employer: 100% of reference earnings for 120 days, or 80% for the 150-day option; where parents share the leave, 100% for 150 days, 83% for 180, and 90% for 180 where the father takes at least 60 consecutive days. As the employer of record, we apply the correct minimum wage, leave and working-time rules within payroll.

## EOR or entity setup: which one fits your Portugal plan?

Incorporating a Portuguese company is faster than most people expect — Empresa na Hora sets one up in a single appointment, and the company’s Social Security registration comes with it. What takes the time for a foreign parent is everything around it: tax numbers for non-resident shareholders, a corporate bank account through KYC, a certified accountant from day one, and accident insurance in place before anyone starts. And once it is running you own the 14-payment structure, the training obligation and a dismissal procedure with no at-will way out. An EOR makes sense while you’re testing the market or hiring a first small team — especially for nearshore tech teams; your own entity usually makes sense once Portuguese headcount and permanence justify the overhead.

### Consider an EOR if you’re:

1. Hiring your first one to five people in Portugal
2. Building a nearshore tech, support or shared-services team
3. Testing the Portuguese market before committing to an entity
4. Working to a hiring deadline measured in weeks, not months

[Get a cost comparison](https://topsourceworldwide.com/contact-us/)

## Why TopSource for Employing in Portugal

TopSource for Employer of Record, global payroll or any other of our services represent a simpler, more reliable and transparent option.

We don’t hide fees or sneak price increases. We don’t lock you in for employees you don’t use. But we do give you a dedicated point of contact, available on the phone so you get answers fast — including on the questions Portugal raises constantly, from calculating TSU across 14 payments to the training-hours liability and lawful dismissal. We blend HR advisory with in-market expertise, and we stay flexible around the needs of your business.

[EOR Services](https://topsourceworldwide.com/employer-of-record/)
[Portugal Payroll](https://topsourceworldwide.com/global-payroll/portugal/)

> “Their expertise and understanding of the unique hiring, payment, and human resource practices in each country has been nothing short of outstanding. Our Client Success Manager, has done just that … ensured our success. Her availability and willingness to engage on a personal level has made all the difference.”

Director of Research Operations,

> “Excellent service, especially from our account manager who has gone above and beyond to help us use the platform effectively. Our manager, significantly simplifies my workload. It is like having your own TopSource HR representative on your team.”

Chief Human Resources Officer,

> “TopSource has been our go-to resource for international hiring. They are responsive, thorough, respectful and knowledgeable. The Client Success team has provided us with the utmost customer service, and the more we use TopSource, the more, it gives us access to more resources and knowledge.”

Senior Manager, Human Resources ,

## More than an Employer of Record.

Employer of Record services are only one way that we help you accelerate your global growth goals. From talent advisory to entity management, we give you the tools you need to research, enter and expand into your key markets.

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Compare available talent, compensation, additional costs and regulations across different countries

[Read more](https://topsourceworldwide.com/hr-advisory/market-selection-advisory/)

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##### Global Benefits Review

Benchmark your global benefits to boost employee retention.

[Read more](https://topsourceworldwide.com/hr-advisory/global-benefits-review/)

## Frequently asked questions

### What does an employee in Portugal actually cost?

The headline employer cost is Social Security (TSU) at 23.75% of gross, uncapped, applied to all 14 salary payments — plus workplace-accident insurance at roughly 0.5-1%. There is no longer any Compensatory Fund (FCT) charge on top: it was abolished from January 2024. Because salaries run over 14 months, total annual cost is far higher than 12 × monthly pay — at the 2026 minimum wage, a hire costs just over €16,000 a year all in. We quote the exact figure per hire before you commit.

### Why are Portuguese salaries paid over 14 months?

Portuguese employees receive twelve monthly salaries plus two mandatory subsidies — a holiday subsidy (subsídio de férias) and a Christmas subsidy (subsídio de Natal), each equal to one month’s remuneration — not just base salary, which matters when the package includes fixed allowances or regular commission. They’re statutory under the Labour Code, not bonuses, and both attract full TSU and income tax. By written agreement up to half of each can be spread across 12 instalments. Budgeting on 12 payments instead of 14 is the most common costly error we see.

### How much is employer Social Security (TSU) in Portugal?

Employer TSU is 23.75% of gross salary, with no ceiling — it applies to every euro and to all 14 payments. The employee pays 11%, withheld from gross, for a combined rate of 34.75%; neither rate changed in 2026. TSU funds pensions, unemployment, sickness and parental benefits, and there is no separate wage-guarantee levy on top of it. We calculate and remit it correctly, including on the subsidies.

### How does dismissal work in Portugal?

Portugal does not allow at-will termination. Dismissal runs through one of four defined routes — fair-cause disciplinary proceedings, collective redundancy, extinction of the post, or unsuitability — each with strict procedure. Where a dismissal is unlawful the employee can be reinstated or, if they prefer, take compensation instead of 15 to 45 days’ pay per year of service with a three-month floor, plus back pay. Probation is the flexible window: either side can end the contract there without cause. As the employer of record, we run every exit through the correct legal process.

### What is the 40-hour training obligation?

Portuguese law requires employers to provide at least 40 hours of certified training per employee per year — raised from 35 by Lei 93/2019, not by the 2023 reform as is often reported. Hours not delivered within two years turn into a training credit, which then lapses after a further three, and any outstanding entitlement is payable to the employee when the contract ends — a real hidden liability for larger teams. We track and manage the obligation so it doesn’t build into an unexpected cost.

### EOR or our own Portuguese entity — which should we choose?

EOR wins on speed and on carrying TSU, the 14-payment structure and dismissal law for you: employees working in days, compliance handled. Your own entity wins on scale once Portuguese headcount and permanence are certain. Many clients run both in sequence — EOR to enter, entity once proven — and we transfer the team when the time comes.

### What employee benefits are most competitive to offer in Portugal?

A meal allowance (subsídio de alimentação) is close to universal in Portugal and often paid via a meal card for favorable tax treatment, alongside private health insurance, which shortens specialist wait times versus the public SNS system. Competitive employers also add life insurance and flexible or remote work policies, given Portugal’s growing popularity as a nearshore tech hub.

### What is the notice period and termination process in Portugal?

Notice periods range from 15 to 75 days depending on contract type and tenure, and Portugal’s Labour Code sets out detailed, cause-specific dismissal procedures that are among the more protective in the EU. Severance calculations were reformed in 2012 to reduce entitlements for newer contracts, so the applicable formula depends on when the contract began, which is easy to miscalculate without local expertise.

### How quickly can you onboard an employee in Portugal through an EOR?

An EOR can typically onboard within one to two weeks for Social Security registration and contract issuance, compared with the several weeks needed to incorporate a Portuguese entity and register with the tax authority and Social Security as a new employer. Portugal’s popularity as a nearshore hub for EU-time-zone tech talent makes this a common first EU hire for many companies.

[Couldn’t find what you were looking for?](/contact-us/)

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[Luxembourg Capital: Luxembourg City Currency: Euro](https://topsourceworldwide.com/employer-of-record/luxembourg/)

[Madagascar Capital: Antananarivo Currency: Malagasy Ariary](https://topsourceworldwide.com/employer-of-record/madagascar/)

[Malawi Capital: Lilongwe Currency: Malawian Kwacha](https://topsourceworldwide.com/employer-of-record/malawi/)

[Malaysia Capital: Kuala Lumpur Currency: Ringgit](https://topsourceworldwide.com/employer-of-record/malaysia/)

[Maldives Capital: Malé Currency: Rufiyaa](https://topsourceworldwide.com/employer-of-record/maldives/)

[Mali Capital: Bamako Currency: West African CFA Franc](https://topsourceworldwide.com/employer-of-record/mali/)

[Malta Capital: Valletta Currency: Euro](https://topsourceworldwide.com/employer-of-record/malta/)

[Mauritania Capital: Nouakchott Currency: Mauritanian Ouguiya](https://topsourceworldwide.com/employer-of-record/mauritania/)

[Mauritius Capital: Port Louis Currency: Mauritian Rupee](https://topsourceworldwide.com/employer-of-record/mauritius/)

[Monaco Capital: Monaco City Currency: Euro](https://topsourceworldwide.com/employer-of-record/monaco/)

[Mongolia Capital: Ulaanbaatar Currency: Tögrög](https://topsourceworldwide.com/employer-of-record/mongolia/)

[Montenegro Capital: Podgorica Currency: Euro](https://topsourceworldwide.com/employer-of-record/montenegro/)

[Morocco Capital: Rabat Currency: Moroccan Dirham](https://topsourceworldwide.com/employer-of-record/morocco/)

[Mozambique Capital: Maputo Currency: Mozambican Metical](https://topsourceworldwide.com/employer-of-record/mozambique/)

[Namibia Capital: Windhoek Currency: Namibian Dollar](https://topsourceworldwide.com/employer-of-record/namibia/)

[Nepal Capital: Kathmandu Currency: Rupee](https://topsourceworldwide.com/employer-of-record/nepal/)

[New Zealand Capital: Wellington Currency: Dollar](https://topsourceworldwide.com/employer-of-record/new-zealand/)

[Nicaragua Capital: Managua Currency: Córdoba](https://topsourceworldwide.com/employer-of-record/nicaragua/)

[Nigeria Capital: Abuja Currency: Nigerian Naira](https://topsourceworldwide.com/employer-of-record/nigeria/)

[Norway Capital: Oslo Currency: Norwegian Krone](https://topsourceworldwide.com/employer-of-record/norway/)

[Oman Capital: Muscat Currency: RIAL](https://topsourceworldwide.com/employer-of-record/oman/)

[Pakistan Capital: Islamabad Currency: Pakistani Rupee](https://topsourceworldwide.com/employer-of-record/pakistan/)

[Panama Capital: Panama City Currency: Balboa](https://topsourceworldwide.com/employer-of-record/panama/)

[Papua New Guinea Capital: Port Moresby Currency: Papua New Guinean Kina](https://topsourceworldwide.com/employer-of-record/papua-new-guinea/)

[Paraguay Capital: Asunción Currency: Guaraní](https://topsourceworldwide.com/employer-of-record/paraguay/)

[Peru Capital: Lima Currency: Peruvian Sol](https://topsourceworldwide.com/employer-of-record/peru/)

[Philippines Capital: Manila Currency: Peso](https://topsourceworldwide.com/employer-of-record/philippines/)

[Portugal Capital: Lisbon Currency: Euro](https://topsourceworldwide.com/employer-of-record/portugal/)

[Puerto Rico Capital: San Juan Currency: Dollar](https://topsourceworldwide.com/employer-of-record/puerto-rico/)

[Qatar Capital: Doha Currency: Riyal](https://topsourceworldwide.com/employer-of-record/qatar/)

[Romania Capital: Bucharest Currency: Romanian Leu](https://topsourceworldwide.com/employer-of-record/romania/)

[Rwanda Capital: Kigali Currency: Rwandan Franc](https://topsourceworldwide.com/employer-of-record/rwanda/)

[Saint Kitts & Nevis Capital: Basseterre Currency: Dollar](https://topsourceworldwide.com/employer-of-record/saint-kitts-nevis/)

[Saint Lucia Capital: Castries Currency: Dollar](https://topsourceworldwide.com/employer-of-record/saint-lucia/)

[Saint Vincent & the Grenadines Capital: Kingstown Currency: Dollar](https://topsourceworldwide.com/employer-of-record/saint-vincent-the-grenadines/)

[Saipan Capital: Capitol Hill Currency: US Dollar](https://topsourceworldwide.com/employer-of-record/saipan/)

[San Marino Capital: City of San Marino Currency: Euro](https://topsourceworldwide.com/employer-of-record/san-marino/)

[Saudi Arabia Capital: Riyadh Currency: Riyal](https://topsourceworldwide.com/employer-of-record/saudi-arabia/)

[Senegal Capital: Dakar Currency: West African CFA Franc](https://topsourceworldwide.com/employer-of-record/senegal/)

[Serbia Capital: Belgrade Currency: Serbian Dinar](https://topsourceworldwide.com/employer-of-record/serbia/)

[Seychelles Capital: Victoria Currency: Seychellois Rupee](https://topsourceworldwide.com/employer-of-record/seychelles/)

[Slovakia Capital: Bratislava Currency: Euro](https://topsourceworldwide.com/employer-of-record/slovakia/)

[Slovenia Capital: Ljubljana Currency: Euro](https://topsourceworldwide.com/employer-of-record/slovenia/)

[Solomon Island Capital: Honiara Currency: Solomon Islands Dollar](https://topsourceworldwide.com/employer-of-record/solomon-island/)

[South Korea Capital: Seoul Currency: Won](https://topsourceworldwide.com/employer-of-record/south-korea/)

[South Sudan Capital: Juba Currency: South Sudanese Pound](https://topsourceworldwide.com/employer-of-record/south-sudan/)

[Sri Lanka Capital: Colombo Currency: Rupee](https://topsourceworldwide.com/employer-of-record/sri-lanka/)

[St-Maarten Capital: Philipsburg Currency: Caribbean Guilder](https://topsourceworldwide.com/employer-of-record/st-maarten/)

[Sudan Capital: Khartoum Currency: Sudanese Pound](https://topsourceworldwide.com/employer-of-record/sudan/)

[Suriname Capital: Paramaribo Currency: Surinamese Dollar](https://topsourceworldwide.com/employer-of-record/suriname/)

[Sweden Capital: Stockholm Currency: Swedish Krona](https://topsourceworldwide.com/employer-of-record/sweden/)

[Taiwan Capital: Taipei Currency: Dollar](https://topsourceworldwide.com/employer-of-record/taiwan/)

[Thailand Capital: Bangkok Currency: Thai Baht](https://topsourceworldwide.com/employer-of-record/thailand/)

[Trinidad & Tobago Capital: Port of Spain Currency: Trinidad and Tobago Dollar](https://topsourceworldwide.com/employer-of-record/trinidad-tobago/)

[Tunisia Capital: Tunis Currency: Tunisian Dinar](https://topsourceworldwide.com/employer-of-record/tunisia/)

[Uganda Capital: Kampala Currency: Ugandan Shilling](https://topsourceworldwide.com/employer-of-record/uganda/)

[United Kingdom Capital: London Currency: Pound Sterling](https://topsourceworldwide.com/employer-of-record/united-kingdom/)

[US Virgin Island Capital: Charlotte Amalie Currency: United States Dollar](https://topsourceworldwide.com/employer-of-record/us-virgin-island/)

[Venezuela Capital: Caracas Currency: Venezuelan Bolívar](https://topsourceworldwide.com/employer-of-record/venezuela/)

[Zambia Capital: Lusaka Currency: Zambian Kwacha](https://topsourceworldwide.com/employer-of-record/zambia/)

[Zimbabwe Capital: Harare Currency: Zimbabwe Gold (ZiG)](https://topsourceworldwide.com/employer-of-record/zimbabwe/)

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