That’s not correct. Look at the other message from dot where he breaks down the calculation (Jun’20).
You pay:
This is if you subscribe to Simple regime. Also note the first 2 years are discounted so the effective tax rate for these 2 is way less.
*A local accountant told me you don’t need to provide any receipts but I’m not sure about that.
Personally, I have been a freelancer for several years and I have never received anything from social insurance after having been sick , and that also for most of the treatments, which led me to take out additional insurance when I was living in another European country.
The allowances are just ridiculous, that’s why I’m wondering about this:
I see a lot of people mentioning social/health contributions. Is it mandatory in PT?
It is also possible to subscribe to private organizations to get private health insurance / coverage which act as social security and complementary health security.
I inquired and made quotes, it costs less monthly and the coverage is much better.
It’s a simple question that I ask myself and I wanted to know if some of you had explored this optional solution.
Yes, paying social security is mandatory as freelancer in Portugal.
Thank you for your reply.
Unfortunately the freelance or self-employed regime in Portugal does not allow you to have a single client.
How are these mandatory contributions calculated if my “single member” LLC is abroad? Same formula ? Or only based on dividends?
Oh my god, things are so more complicated than what I was told over the phone… and it’s been so long this this started, what did you guys set-up and who would be THE lawyer point of contact to help set-up this ? Thanks for the feedbacks, wil re-read it 3 times, and then will be scraed to contact so-called experts who contradict themselves. I guess as it was said, NHR is made for old people, not active ones… anyway, moving to Lisbon, looking forward to meeting you !
You’re overall correct, and I like how clear and concise your summary is: very to the point! 
For the record, I’d like to point out these 3 details, which are often getting lost or misunderstood:
P.S. You’re right: with Simplified Regime you don’t need to provide receipts for the 25% assumed expenses.
Are you 100% that the 50% (first year) and 25% (second year) credit also applies for the 20% NHR rate? Or it only applies for the normal simplified regime?
Does the 50% / 25% discount also applies to NHR? Also the 20% is flat rate is going to be 20% of the total income or 20% of 75% of total income?
This post and comments helped me a lot so far, but I still need to make sure of some things to see what could be the most beneficial situation for me.
I’m currently living in Germany and working for a Canadian company (localized via Employer of Record, meaning that I’m officially employed in Germany and both of us pay all the German taxes). My plan is to move to Portugal soon with NHR. Please correct me if I’m wrong on any data below. My current situation:
Salary: 75k euros/year
Taxes (PIT + SS): around 40%
Company spends around 28% of my salary in taxes and EoR fees (so I have a cost of around 96k euros/year for them)
Moving to Portugal with NHR I have 2 options: keep working under an Employer of Record (now localized to Portugal) or renegotiating my contract to make it look like a contractor.
OPTION 1: As a localized employee via Employer of Record, paying Portuguese taxes:
Salary: 75k euros/year
Taxes (PIT + SS): 31% (20% NHR + 11% SS)
Company spends around 36% of my salary in taxes and EoR fees (so I have a cost of around 102k euros/year for them)
OPTION 2: As a contractor. Would remake my contract to include a temporary limit (1 or 2 years) to work on a specific project (not sure if this is enough to be considered contractor, please enlighten me)
Salary: 75k euros/year
Taxes (PIT + SS): around 30% (20% NHR over 75% of income + 21.4% SS over 70% of income)
No VAT charged, as it is for a Canadian company.
Company spends ZERO extra with me, meaning I can possibly renegotiate my salary by A LOT, plus not paying SS on 1st year.
Unlikely case: company gets charged 10% SS because of 100% dependency (which someone mentioned that doesn’t happen to foreign companies).
To me seems like the contractor way is more beneficial by far for both me and the company. Also more flexible in case I want/need to find a new job in the future. It does include the risk of the Tax Authorities reviewing my contract to check if it falls under regular employment (then forcing me to switch to the Employer of Record way and maybe lowering my salary) or forcing a 10% SS pay from the company.
I would love suggestions and corrections to make the best choice here. Thank you!
If you ‘reformulate’ your work contract to be seen as a contractor/self-employed, you will moreover be exempt from SS contributions for the first 12 months after opening your self-employment activity in Portugal. It’s obviously a legal grey area at best…
In any case, with whatever option you choose you will be able to live like a royalty here. However, not abusing the system will at least not give further fuel to the rising hostility against foreigners in Portugal.
Thank you for your reply!
I’m well aware of the economic situation in Portugal right now, especially concerning housing availability and absurd rent prices. That’s indeed an important thing we should all be aware and supportive towards the locals and young people. We also influence the rental market (for worse) and we should do our best to take their side on this issue in every way possible.
Hey all, this is exactly the kind of thread I was looking for. Thanks for all your insights so far. My own questions aren’t fully answered as it seems to be the case for most here 
but it’s great to feel we’re a bunch with similar situations.
I don’t mind paying my due in taxes. I’d also like not to pay more than necessary, and, you know, if this NHR was supposed to be a thing, would rather be able to enjoy some of it!
My own situation:
So I can’t invoice my company directly under my own name, and I can’t really draw dividends just for my regular work since my partner and I don’t work the same amounts.
I would of course as much as possible just invoice my clients directly from here instead, but some of my new clients are Canadian and actually prefer being invoiced from there (tax/grants purposes).
So… yeah.
I’ve been feeling stuck in this hiccup for around a month now. I’m finally starting to see some options though. Working on it. I’ll be happy to share back here if interested.