EU-approved 5% corporate tax regime — recently extended, giving new companies a longer planning horizon.
Madeira Company Formation — 5% EU Corporate Tax
We help entrepreneurs set up a company in Portugal's Madeira Free Trade Zone (MIBC) — fully compliant with EU law, with real substance and lasting benefits.
The problem with your current structure
If you're running a profitable business through a Dutch BV, you're likely paying 19–25.8% corporate tax — plus up to 26.9% Box 2 income tax when you take profits out.
For international entrepreneurs, digital businesses, and holding structures, a significant share of hard-earned revenue goes to taxes that could legally be reduced.
High corporate tax rates eating into profits
19–25.8% corporate tax, plus up to 26.9% Box 2 income tax on distributions.
Complex Dutch rules with limited optimization
Rigid structures with few legitimate tax benefits.
International income taxed at Dutch rates
No benefit for location-independent businesses.
Locked into an inefficient structure
Watching competitors optimize while you overpay.
What if there were a legal, EU-compliant way to significantly reduce your tax burden?
The Madeira advantage
A legitimate tax optimization strategy within the European Union.
5% corporate tax
Reduced 5% rate for qualifying companies, now extended under the latest regime.verify
EU member state
Full EU legitimacy — not an offshore haven, a real European structure.
Substance-based compliance
A real EU structure, not a loophole. We build each company to meet the regime's substance conditions and to stand up to Dutch controlled-foreign-company scrutiny — which is why we assess every situation individually rather than promising a fixed outcome.
Treaty access
Portugal's extensive double-tax treaty network protects your income.
Euro zone
No currency risk, seamless European banking integration.
0% dividend WHT
No withholding tax on dividends to non-residents (conditions apply).
Is this legal?
Absolutely. The Madeira International Business Centre (MIBC) is a fully approved EU state-aid regime — not a loophole, but a deliberate economic-development incentive authorised by the European Commission. The key is genuine substance and compliance, which we ensure for every client.
Netherlands vs. Madeira
See the real difference in your bottom line.
| Aspect | Dutch BV | Madeira company |
|---|---|---|
| Corporate tax rate | 19% (≤€200k) / 25.8% (>€200k) | 5% |
| Dividend withholding tax | 15% WHT (plus Box 2 income tax on the owner) | 0% to non-residents*verify |
| EU member state | ||
| Substance required | Minimal | Yes — genuine local substance (staff, office, management) |
| Setup cost | €2,000 | €5,000 |
| Setup time | 1 week | 4–6 weeks |
| Best for | Local Dutch operations | International income, IP, holding |
*Dividend withholding tax depends on the recipient country and applicable tax treaties. The Dutch 15% withholding tax and the Box 2 income tax a director-owner pays are different taxes. Individual situations vary.
See your potential savings
A simplified estimate. Actual savings depend on your situation, substance costs, and applicable treaties. Book a call for accurate figures.
Is Madeira right for you?
This structure works best for specific business profiles.
Good fit
- Annual profit of €100,000 or more
- Location-independent income (SaaS, consulting, e-commerce, trading)
- Holding company for investments or subsidiaries
- IP licensing or royalty structures
- Willing to establish genuine business substance
- Planning for long-term tax efficiency (3+ years)
- Open to occasional travel to Portugal
Not a fit
- Revenue primarily from Dutch clients (creates PE risk)
- Unable or unwilling to meet substance requirements
- Looking for a paper-only solution without real presence
- Short-term thinking (less than 2–3 years horizon)
- Annual profit under €80,000 (cost may not justify savings)
How we set up your Madeira company
A clear, structured process from first call to operational company.
- 01Week 1
Discovery call
A free 30-minute strategy session. We analyse your business, discuss your goals, and determine whether Madeira is the right fit. No obligations.
- 02Week 1–2
Structure design
We design your optimal structure — company type, substance setup, banking approach, and compliance framework. You receive a detailed proposal.
- 03Week 2–3
Document preparation
We collect required documents, prepare applications, and handle the paperwork. You sign where needed — we do the rest.
- 04Week 3–4
Company registration
Incorporation in Madeira, registration with the MIBC (Madeira International Business Centre), and tax-number acquisition.
- 05Week 4–5
Bank account setup
Opening a corporate bank account with a Portuguese or international EU bank. We guide you through compliance requirements.
- 06Week 6
Handover & operations
Complete handover with all documents, access credentials, and a compliance calendar. Optional ongoing administration.
What "substance" actually means
The 5% rate is earned, not automatic. Your Madeira company needs genuine local activity: real management in Madeira, at least one to five local jobs created within the first six months (with a minimum €75,000 investment in fixed assets in the first two years), or six or more jobs — and the reduced rate applies up to income ceilings based on how many jobs you create. We tell you upfront what this means for your case, including the running cost, so there are no surprises.verify
Investment
Transparent pricing for a premium service.
Madeira company formation
One-time setup fee. No hidden costs. Government fees included.
One-time setup fee includes:
Optional add-on services
Payment terms
50% deposit to begin, 50% upon company registration. Payment by bank transfer.
The math, honestly
On €150,000 of qualifying profit, the corporate-tax difference versus a Dutch BV is roughly €20,000 a year. Your net saving is lower once the required substance (staff, office, compliance) is factored in — which is why this structure fits profits from around €100,000 upward. We model your exact numbers in the free call.
Full transparency: if during our discovery call we determine Madeira isn't right for your situation, we'll tell you — and recommend better alternatives. No pressure, no wasted time.
The Madeira tax structure, explained
Everything you need to know before making a decision.
- Complete breakdown of the 5% tax regime
- Substance requirements explained simply
- Step-by-step setup process
- Cost breakdown and ROI analysis
- Common mistakes to avoid
- Checklist: is Madeira right for you?
Download your free guide
Frequently asked questions
Clear answers to common concerns.
Is the Madeira tax structure legal and compliant?
What are the substance requirements?
How much can I actually save in taxes?
Do I need to move to Madeira?
How long does the setup process take?
What types of businesses qualify?
What happens after the current regime period ends?
Can I use this structure if I'm a Dutch tax resident?
Ready to reduce your tax burden?
Book your free strategy call today. No obligations, no pressure.