Advantages of Setting Up a Company in Madeira

As an integral part of Portugal and the European Union, the Autonomous Region of Madeira offers several advantages for setting up companies. Companies incorporated in Madeira are Portuguese companies for all intents and purposes.

When you set up a company in Madeira you benefit from one of the lowest tax rates in Europe – 14.7%. There are also other advantages:

• Participation exemption for dividends and capital gains;
• Close to 80 conventions to avoid double taxation;
• Double taxation tax credit;
• Patent Box Regime: 85% tax exemption on income from intangible assets.

Shareholders of companies in Madeira also enjoy several advantages:

• Exemption from capital gains on the sale of Portuguese companies, if the requirements of the participation exemption are met;
   
• Tax exemption on the distribution of profits and dividends to corporate shareholders, if the participation exemption requirements are met;
   
• Residence permits for investment, entrepreneurship, or skilled employment;
   
• Exemption from withholding tax or withholding tax at reduced rates, on the distribution of dividends to individual shareholders who are not residents of Portugal (only for companies of the International Business Centre of Madeira (IBCM);
   
• Exemption or reduced rates of personal income tax, under the tax regime for non-permanent residents;
   
• Portugal has the 5th best passport in the world.

Advantageous Tax Regime

Companies in Madeira benefit from a reduced rate of Corporate Income Tax – 14.7% or 5% if licensed to operate in the International Business Centre of Madeira.

When you set up a company in Madeira you also have full access to the Portuguese participation exemption regime, to the network of conventions signed by Portugal to eliminate double taxation (more than 80) and unilateral double taxation tax credit.

Investment Opportunities in Madeira

Madeira offers several investment opportunities.

International Services

Big data, SaaS, e-commerce, IT services, intellectual property and trading companies find Madeira, and the International Business Centre of Madeira in particular, an attractive tax regime.

Industrial Activities

The Industrial Free Trade Zone of the International Business Centre of Madeira is home to industrial activities which, in addition to all the other advantages offered by the IBCM, can also benefit from a 50% income tax deduction.

Holding Companies

Holding companies are important instruments for the management of international investments and can benefit from mechanisms for the elimination of international double taxation and the extremely advantageous tax framework of the International Business Centre of Madeira.

Real Estate

Madeira is one of the Portuguese regions with the highest growth in the real estate sector, not only in the residential sector, but also in the tourism sector. Operating properties under the local accommodation scheme is a popular option, as well as rural and sustainable tourism establishments.

Intellectual Property

The creation, protection, and management of intangible assets, such as intellectual property, are issues that are of great concern to companies in this day and age. Thanks to the tax benefits available at the International Business Centre, Madeira is an excellent option for the management of various types of intellectual property, such as: