Madeira

Madeira

The island of Madeira is located in the Atlantic Ocean approximately 600 miles from Portugal and Africa.Portuguese is the national language but English is widely used for business purposes.

Madeira is governed by Portuguese law but has partial political autonomy.

Under the Tax Reform Act of 2000, a new tax regime was introduced in Portugal. This Act was approved by the EU in 2002. Portuguese companies existing at the time of effect, 1^st January 2001, remain tax-free until 2011. Those companies licensed from 2003 to 2006 paid 1% in 2003 – 2004, pay 2% in 2005 – 2006 and will pay 3% in 2007 – 2011.The Portuguese rate of tax for resident companies is currently 25%.

The new regime approved by the EU in late 2002 does not allow for new formations of financial services companies.

The legislation covers the following main points:

Capital

-Limitada companies must have a minimum capital or “registered quotas” of € 5,000.
-The minimum number of subscribers is two and the capital represented by each “quota” (share) must not be less than €100.
-SA companies must have a share capital of €50,000 of which 33% must be paid up on the incorporation.The minimum number of shareholders is five.This form of company may issue bearer shares.

Officers

-Every company must have a minimum of one director unless SA capital exceeds €1 million.Directors do not need to be resident but foreign directors must be registered and act through a registered agent.
-Corporate directors are not permitted for Limitada Companies.
-Directors’ meetings may be held anywhere although members’ meetings must be held in Madeira.

Accounts

-SA companies are subject to certain supervisory controls from which Limitada companies are exempt.
-Annual accounts and a tax return must be filed with the tax authorities.
-Limitada companies are filed on public record.

Incorporation

-Companies can be incorporated within 20 working days.
-The Certificate of Incorporation must be executed by way of notarial deed and in front of a notary public.
-Shelf companies are available.
-All companies must maintain a registered office in Madeira.

Taxation

-The minimum annual tax or registration fee payable by a Madeiran company is € 1,500.
-Madeira, being a region of Portugal, benefits from full membership of the European Community and Portugal’s extensive double taxation treaty network, which includes most EU countries, Norway and Switzerland.
-There are no exchange controls.

Aircraft and ships

-The Madeira Government has announced that it intends to establish an aircraft register.
-Until the year 2011 no corporation tax is payable on profits made from ships flying the Portuguese flag that operate in international waters.

Useful links : Madeira Government - http://www.sdm.pt

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