Tax residents in the EU with foreign clients often face 40–50% effective rates. Here's how proper structuring changes that.

Freelancers and digital entrepreneurs often face a tough reality:(e.g.) you’re tax resident in Portugal, but most clients are abroad (EU, US, UK). This leads to 40-50% effective tax rates through IRS + social security, plus constant worry about compliance across borders. The good news? You can legally reduce or defer this burden with proper structuring.

Your Typical Situation

You’re based in Europe, but:

• 80-90% of income comes from Stripe, PayPal, or platforms with foreign clients.
• You’re on the simplified regime (coeficiente de 0.75 for IT/services), but real expenses often exceed that assumed profit.
• No clear separation between personal and business, or between local and foreign income flows.

Common Tax Leaks

• Over-reliance on default setup: Registering everything locally means local country taxes worldwide income at progressive rates (up to 48% + solidarity surcharges). Foreign clients don’t change this.