Recibos verdes: the order most guides get backwards
Freelancing in Portugal runs on one phrase: recibos verdes, the electronic invoice-receipt a trabalhador independente issues. Getting to the point where you can send one is where people lose weeks — usually because they were told the steps in the wrong order.
The order is NIF → activity → NISS
Most guides say: get your NIF, then your NISS, then open your activity. For a foreign freelancer that sequence stalls, because the NISS application asks you to prove a work situation — and for the self-employed, the proof is the open activity.
1. NIF — tax number, from Finanças.
2. Início de atividade — register self-employment with Finanças, choosing your activity code. Free.
3. NISS — now you have something to show Segurança Social.
One shortcut worth knowing: if you already have a NISS — say from a previous job as an employee — you do not need to go to Segurança Social at all. Opening the activity notifies them automatically through data sharing between the two bodies.
The "free first year" is not free
Open activity for the first time and you get a 12-month exemption from social security contributions, provided you have had no independent activity in the previous three years. Everyone mentions this. Almost nobody mentions the other half:
During those 12 exempt months you have no access to social benefits, and the months do not count towards your pension.
No sick pay, no parental benefit, no unemployment protection built up, and a year missing from your contribution record. If you can afford to contribute, contributing buys you cover. Treat the exemption as a cash-flow tool for a thin first year, not as a gift.
What you will actually pay
Social security: 21.4% — but not on everything you invoice. For services the contribution base is 70% of relevant income, so the effective bite is around 15%. You report income quarterly.
Income tax, simplified regime: instead of tracking expenses, tax applies to a fixed coefficient of turnover. For the professional services listed in article 151 of the IRS Code — the bracket most consultants, designers and translators fall into — the coefficient is 0.75: on €10,000 invoiced, €7,500 is taxable.
The simplified regime runs up to €200,000 of annual income. Above that, organised accounting with a certified contabilista becomes mandatory.
IVA: the €15,000 line
Under article 53 of the VAT code you are exempt from charging IVA while your annual turnover stays under €15,000. Below it you invoice without VAT — and you also cannot reclaim the VAT you pay on your own purchases.
Watch the exit rule, because it is sharper than people expect: exceed the ceiling by more than 25% (€18,750) during the year and the change is immediate — the very invoice that crosses the line already carries IVA.
Clients abroad
This is the question artists and remote freelancers actually ask, and the answer is reassuring: invoicing clients outside Portugal does not by itself push you out of the article 53 exemption. Only exceeding the turnover ceiling does.
What does change with foreign clients is the VAT treatment once you are in the normal regime — EU business clients (reverse charge, VIES), non-EU clients and private consumers are each handled differently. That is the point to buy an hour of a contabilista's time, not before.
Where you pay income tax is a separate question: if you are tax-resident in Portugal, that income is generally declared here regardless of where the client sits.
Bottom line: NIF, then open the activity, then the NISS. Budget around 15% for social security and a 0.75 coefficient for tax. Keep an eye on €15,000. And think twice before treating the first exempt year as free money — it is a year without cover.
General information, not tax advice. Figures current at publication — confirm on Portal das Finanças or with a contabilista before acting.
Guidance, not legal or tax advice — verify your case with official sources.