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NEWCO is an inward investment services provider specializing in the implementation of foreign investment in Portugal, including Madeira Island, and Malta.

Portuguese economic support schemes (COVID-19)

Portuguese economic support schemes (COVID-19)

The COVID-19 pandemic has brought new economic constraints and lockdowns. In an effort to mitigate the economic and social effects of the sanitary restrictions, the Portuguese Government has introduced new measures to support the economy and broadened the scope of existing ones.

 

Scheme for Progressive Resumption of Economic Activity

This scheme, created in August last year, has now been renewed for - at least - another 6 months. For micro, small and medium-sized enterprises (SMEs)1, the 50% reduction in social security contributions is maintained and the total remuneration of workers is now guaranteed, up to 3 times the national minimum wage (€1,995).

For companies that have recorded a 25% or higher drop in turnover, there will be an additional aid of two national minimum wages per worker, with adhering companies being forbidden from making collective firings and extinguishing jobs for up to 2 months after the end of the aid.  The lay-off simplificado scheme continues active for companies that must remain closed by legislative or administrative determination.

 

Additional aid for the reduction of self-employed worker’s economic activity

This financial support may be granted to self-employed workers, including sole proprietors of businesses, who have been subject to the suspension or closure of economic activity by virtue of the state of emergency in force. The calculation of the amount to be received varies according to the social security contribution base in the previous 12-month period (at the date of the application) and the percentage of turnover reduction observed. This aid must be requested monthly through Segurança Social Direta2.

 

Extra financial support for workers

This financial support is available to self-employed workers, managers of micro and small enterprises, and other workers who are unemployed or economically and socially unprotected. The amounts made available range from €50 to €501.6, allocated monthly for a maximum of 12 months. This support can be requested through Segurança Social Direta.

 

Apoiar Scheme

This scheme to financially assist SMEs is now extended to companies with more than 250 employees but less than €50 million in turnover, and sole proprietors of businesses without organised accounting but with dependent workers. This scheme materialises in non-repayable grants with a limit of €100.000 per company or up to €3.000 per sole proprietor. The scope of this programme may be extended to companies with fiscal debts, which will be dependent on the regularisation of the debts by the company.

 

Financial aid for the payment of rents

Companies that have recorded a drop in turnover of between 25% and 40% will receive financial aid equivalent to 30% of the rent, up to a maximum of €1.200 per month. For companies that have recorded a drop in turnover of more than 40%, the aid will be 50% of the rent up to a maximum of €2.000. A line of credit will also be opened for tenants and landlords.

 

Other support and benefits

  • Businesses experiencing a fall in turnover of 25% or more will be able to pay VAT for the first quarter of 2021 in 3 or 6 monthly instalments, without interest.
  • SMEs may be exempted from making payments on account in 2021.
  • Executions by the Tax Authority will be suspended in the first quarter of 2021.
  • Lines of credit will be available for SMEs, large companies, exporter companies and companies in the tourism sector.
  • SMEs will be able to receive tax benefits for joint participation in external promotion projects.
  • The moratorium period on credit will be reopened by March 31st.
  • Financial support for SMEs to reconvert workplaces to the new conditions of teleworking and social distancing.

 

We are available to answer any questions on this subject. Please contact us.


1Companies with fewer than 250 employees and an annual turnover not exceeding €50 million or an annual balance sheet total not exceeding €43 million.

2Online website for the Portuguese welfare administration

27 Jan 2021