When Doing Things Legally Costs More: Hiring Workers in Portugal

So, picture this: you’re trying to do the right thing. You’ve got a house project—maybe painting a wall, fixing a roof, or some minor repairs—and you decide, “Hey, I’m going to follow the rules here.” You insist on getting an invoice from the worker, knowing it’s the legal and proper way to handle things. Good on you, right? That’s what I thought too.

But let me tell you, doing things by the book in Portugal can sometimes feel like stepping into a legal minefield. Here’s my story, and a little heads-up on what you should know before hiring workers for your real estate projects.


My Costly Lesson Hiring Workers in Portugal

Last year, I hired a painter to do some work on my house. Nothing fancy, just a few touch-ups. I insisted on getting a proper invoice (fatura). Why? Because it’s the law, and I like to keep everything above board. What I didn’t know is that by doing this, I set myself up as his “main employer” (entidade contratante) in the eyes of Social Security (Segurança Social).

Fast forward to this year, I get a surprise message from Segurança Social: I owe €400 for his social security contributions. What?! I wasn’t his boss. I didn’t hire him full-time. I just wanted my walls painted!

Turns out, if someone earns more than 50% of their declared income from you in a year, you’re considered their main employer. That means you’re on the hook for 10% of their social security payments, even if they work for others too. And guess what? I didn’t have any way to prove otherwise because I didn’t know I needed to keep track of his other jobs.

Workers in Portugal
Workers in Portugal

More Than Just Taxes

It doesn’t stop at unexpected bills. In Portugal, if you hire someone to work on your property, you’re also responsible for their safety. Yep, that’s right. If they don’t have insurance, it’s on you to provide it.

Imagine this: the painter is up on a ladder, working on your ceiling. If he falls and breaks his arm, and he’s uninsured, you’re legally responsible. That could mean paying his medical bills, covering lost wages, and dealing with all sorts of headaches. Even for a small one-day job, the risk is huge if you don’t handle things properly.


Lessons Learned (the Hard Way)

Here are some takeaways from my experience, so you don’t end up in the same boat:

1. Always Ask About Insurance

Before hiring anyone, ask if they’re insured. If they’re not, you may need to take out temporary worker’s insurance to cover them. It’s an extra cost, but much cheaper than dealing with an accident.

2. Verify Their Income Sources

If they only work for you, or if they’re vague about their other clients, proceed with caution. Being their “main employer” means you’re on the hook for more than just their payment.

3. Consider Hiring Registered Companies

When possible, work with established businesses. Companies usually handle their own taxes, insurance, and social security, leaving you out of the equation.

4. Get Everything in Writing

A simple written agreement can go a long way. Include details about the work, their responsibilities (like insurance), and clarify that you’re not their primary employer. It’s not foolproof, but it helps.


Why It Feels So Unfair

The system is designed to crack down on undeclared work and ensure that everyone contributes to Social Security. In theory, it’s a good thing. But in practice, it can feel like an honest person’s nightmare. People who try to follow the law, like you and me, end up footing the bill for workers who don’t declare all their income.

And let’s be real—most workers prefer to work under the table to avoid taxes altogether. When you insist on doing things the right way, you’re the one left holding the bag.


The Bottom Line

If you’re planning any kind of real estate project in Portugal, even something small, do your homework. Talk to the worker about their insurance and tax situation. And if something feels off, don’t be afraid to walk away or hire someone else. It might feel like a hassle upfront, but trust me, it’s nothing compared to the hassle of dealing with unexpected legal obligations.

Would I still insist on an invoice next time? Honestly, I don’t know. Part of me feels burned by the system. But another part of me knows that taking shortcuts just perpetuates the problem. Either way, I’ve learned to be much more careful when hiring workers in Portugal. Hopefully, my story can help you avoid the same pitfalls.

So, what do you think? Have you had similar experiences? Let us know in the comments below.

Top 5 Tips for Building Your Own Home in Portugal

When you are planning to build your own home in Portugal, you need to be aware of the documents and procedures that you need to undertake. The following will help you understand what documents you will need for construction permits to build your own home in Portugal.

There may be some cases where an application for construction permits is not required, such as when building with temporary materials or when reconstructing existing buildings.

1. Find the right location

Portugal is a small country and it may be more difficult to find a suitable location than you imagine. if you are thinking to be building your own home in Portugal you may already have a nice region in mind that you like most. But don’t overlook the hidden jems Portugal has to offer.

There are some regions that are more affordable than others, some are actually not far from the beach and mountains.

2. Apply for a planning permission

This is absolutely mandatory and will save you from potential problems later on. But don’t worry there is offices out there who are specialized in helping you in this process, such as an architectural office. Hiring an architect in Portugal is not as expensive as you might think. Depending on the size of your project it can cost you as little as 10 € per square metre.

3. Find and hire an architect

It might seem like an unnecessary expense, but it will make your life much easier in the long run by ensuring that everything gets done correctly, within budget and on time. Also, the architect in Portugal can design your home in a way that will actually save you money, in the end you probably pay the same that you would have without an architect.

4. Consider buying land

If you are only looking to build a home for yourself in Portugal, then make sure you look in the area that is right for you and have everything nearby that you will need. Also, it is important to check if the land is suitable for construction. If you buy a land in Portugal that is located in an estate make sure to check the estate rules – sometimes there are rules regarding colours of the house or windows or the roof needs to have a certain colour and angle… etc.

5. Speak to a solicitor

Better safe than sorry. Getting legal advice will help you to understand the procedure involved and be aware of potential pitfalls.

6. Find a reliable Builder

Unless you have a buidling company at hand who is delivering a key-finish solution (soluções chave-na-mão), you will need to find a reliable builder in the area. Usually the best is to ask around, like this you will get a few good contacts who can price your project and giving you a time frame for completion.

Conclusion: Building Your Own Home in Portugal

With these few simple steps you can be building your own home in Portugal and invest in the healthy and growing housing market of sunny Portugal.

Image by Steffen Zimmermann on Pixabay 

Will you be at Portugal’s largest real estate show?

In October this year it will be time again for all real estate lovers to flock to Lisbon. Portugal’s largest property fair will held its 22nd edition from October 10th to 13th.

In this four-day event you can discover large commercial developments, learn about latest trends from leading real estate experts and find potential partners for your real estate business among the exhibitors.

SIL, short for “Salão Imobiliário de Portugal”, is a meeting place for real estate investors, entrepreneurs, technicians, public institutions as well as potential buyers.

You can get a ticket for 8 EUR or if you buy 4 tickets in a bundle it costs only 20 EUR.

There will also be a Competition – the annual SIL Real Estate Awards

SIL promotes Real Estate Excellence, so this can be a good opportunity to get some attention at the Largest Real Estate Show.

The categories are:

Sustainable Construction and Energy Efficiency

The Best Real Estate Project for

  1. a) Commerce, Services and Logistics
  2. b) Housing
  3. c) Tourism.

Urban Rehabilitation

  1. a) Housing
  2. b) Tourism
  3. c) Public Spaces
  4. d) Offices
  5. e) Commercial and Services.

You can see all information and how to enter the competition on https://imobiliario.fil.pt/

If you think, “yeah, that´s all very nice but will be too boring for my kids”, think again! The makers of the fair even thought about that. There will be a Kid’s Club, where parents can drop of their kids. They organise various play and educational activities for children aged between 3-12 years old. Knowing that the kids are having great fun and being looked after, the parents can stroll the real estate show with peace of mind.

You can find more about the Kid´s club on https://www.essential-business.pt/2019/06/04/sil-launches-sil-village-and-sil-kids-club/

Where is the real estate show?

FIL – Feira Internacional de Lisboa
Rua do Bojador, 1998-010 Lisbon, Portugal

Would be great to meet you there!

Buying a house in Portugal – A step by step guide

Buying a house in Portugal:
Portugal is one of the favorite locations to move abroad.
It’s no wonder that it is the first choice for many when looking to buy a home to relocate or to spend their holidays.

If you have your eye on that nice cottage with sea view in sunny Portugal, then you are in the right place.

Here is a step by step guide to take you through the entire process when buying a house in Portugal.

Continue reading Buying a house in Portugal – A step by step guide