# Owning a Portuguese Lda. Through a Holding Company (and What an SGPS Is)

> How a foreign or Portuguese holding company can own an Lda., the participation exemption on dividends, and when a Portuguese SGPS makes sense.

Source: https://getlda.pt/guides/holding-company-portugal · Updated 2026-09-27

**Quick answer:** Any company, Portuguese or foreign, can own 100% of a Portuguese Lda. Dividends paid to a qualifying parent company can be exempt under the participation exemption. An SGPS is a specific type of Portuguese holding company whose only purpose is managing shareholdings; since the participation exemption applies to all companies, most founders don't need one.

Many founders already have a company elsewhere and want it — rather than themselves — to own the new Portuguese business. That's straightforward, but the terminology can be confusing.

## A foreign company as partner

A company from any country can be a partner in a Portuguese Lda., alone (creating a [Unipessoal Lda.](https://getlda.pt/guides/unipessoal-lda)) or alongside other partners. You'll need:

- the parent's **certificate of incorporation** and a recent **registry extract**;
- its **articles of association**;
- a **board resolution** approving the investment and naming a representative;
- a **power of attorney** for whoever signs in Portugal;
- a Portuguese **tax number** for the parent company.

Foreign documents need an **apostille** (or consular legalisation) and a certified **Portuguese translation**.

## Dividends: the participation exemption

When a Portuguese Lda. pays dividends to a parent company, they can be exempt from withholding tax if the parent:

- holds at least **10%** of the capital, for at least **one year**;
- is resident in the EU/EEA, or in a country with a tax treaty with Portugal that includes exchange of information; and
- is subject to a corporate income tax comparable to IRC.

Similar rules can exempt dividends a Portuguese company receives from its own subsidiaries. Your lawyer or accountant should check the conditions for your specific structure.

## What is an SGPS?

An **SGPS** (*Sociedade Gestora de Participações Sociais*) is a Portuguese company whose sole purpose is to manage shareholdings in other companies. It was historically the go-to structure for holding groups because of its special tax regime.

Since the participation exemption was extended to **all** Portuguese companies, the SGPS has lost most of its tax advantage. It still has strict rules on what it can do, which is why most founders today don't need one. It can still make sense for large groups where the formal status matters to banks or investors.

> **In short:** a foreign parent company owning your Lda. is *not* an SGPS. It's simply a corporate partner.

## Beneficial ownership

Even when a company owns the Lda., the individuals behind it must be declared in the [RCBE](https://getlda.pt/guides/rcbe-beneficial-ownership-register). Banks will also ask for the full ownership chain when you open an account.

## Should you use a holding structure?

It can help if you plan to own several companies, reinvest profits across a group, or bring in investors at the holding level. For a single small business, direct personal ownership is usually simpler and cheaper to run.

## Related guides

- [RCBE: Portugal's Beneficial Ownership Register Explained](https://getlda.pt/guides/rcbe-beneficial-ownership-register.md)
- [Unipessoal Lda.: The Single-Member Company in Portugal](https://getlda.pt/guides/unipessoal-lda.md)
- [Opening a Company in Portugal as a Non-Resident or Foreigner](https://getlda.pt/guides/open-a-company-in-portugal-as-a-non-resident.md)

Ready to open your Lda.? Licensed Portuguese lawyers handle it 100% online: https://getlda.pt/register