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Mercans CountryIntel ® Brazil Payroll And HR Insights

Mercans offers complete payroll, PEO and HR services in Brazil

Brazil is a leading regional economy with foreign direct investment of USD58 billion in 2021. It boasts a large pool of talented workers and a diversified economy with USD280.4 billion in exports in 2021. Key sectors to invest include agribusiness, infrastructure, oil and gas, renewable energy as well as venture capital and private equity.

Doing Business in Brazil

Foreign companies can deal with the Department of Registration of Business and other federal agencies for the relevant processes to set up a new business. The National Bank for Economic and Social Development (BNDES) is the federal development bank which also provides financial support to private companies with headquarters in Brazil (regardless of size) with projects that promote innovation, regional development and environmentally friendly activities.

Entity Registration and Incorporation Requirements

Setting up a new business or expanding an existing one in Brazil is straightforward. Choose how your company operates from a range of entity types that suit your individual circumstance.

Banking

Banking Hours: 10:00 am to 4:00 pm from Monday to Friday

Working Week

The standard working week is from Monday to Friday from 8:00 am - 6:00 pm

Labor Law

The central piece of legislation governing employment is the Consolidation of Labor Laws (CLT). All workers, including foreigners, are required to hold a work permit in which terms of employment must be recorded.

Main Industries

Textiles, shoes, chemicals, cement, lumber, iron, oretin, steel, aircraft, motor vehicles

GDP Growth

1%

Dates & Numbers

dd/mm/yyyy

Official State Name

Federative Republic of Brazil

Population

213 million

Capital

Brasilia

Major Languages

Portuguese

Currency

Brazilian Real (BRL)

Internet Domain

.br

International Dialing Code

+55

Brazil
Brasília, BR
6:58 am, December 2, 2022
18°C
scattered clouds

Payroll

The minimum wage is set by the federal government and is reviewed and adjusted each year. Each category of worker has a professional minimum wage which cannot be lower than that set by the federal government.

It is acceptable to provide employees with online payslips

Payslip

Payroll reports must be kept for 5 years

Reports

Employees are entitled to paid annual leave of 30 days

Annual Leave

Employees are entitled to paid sick leave of 15 days

Sick Leave

Employees are entitled to 6 months of paid maternity leave and 5 days of paid paternity leave as applicable

Maternity & Paternity Leave

Employees must be provided with at least 90 days notice of termination of employment

Employee Termination

The 13th month salary is a mandatory payment made to employees at the end of the year.

13th month salary

1212 BRL per month

Minimum Wage

The payment for overtime is set at 1.5x the employee's ordinary rate of pay for a maximum of 3 hours overtime per day

Overtime

Employees paid monthly are entitled to contribute 8% of their salary to a government-run severance fund.

Severance Pay

Tax and Social Security

Taxation occurs at three levels of government, that is, federal, state and municipal. All legal entities are required to pay taxes regularly and file a yearly tax return. All companies are required to obtain a CNPJ (Corporate Taxpayer Identification Number). Social security is managed by the INSS (Instituto Nacional de Seguro Social).

Tax

Brazil has an ex-tariff regime which allows for a temporary reduction in current import duties for capital goods and computer and telecommunications goods. Companies can apply for an ex-tariff concession. Tax holidays may be offered to certain industries operating in specific areas.

34%

Corporate Income Tax

27.5%

Personal Income Tax

17%

Sales Tax

17%

VAT

Social Security

Social Security Contributions are collected to maintain the social security regime which includes paying for retirement, pensions due to death, illness or disability and other benefits. Contributions, withheld by the employer, are made by both the employer and employee.

39.8%

Social Security Rate

28.8%

Social Security Rate for Employers

11%

Social Security Rate for Employees

Employment Law

No distinction is drawn between skilled and unskilled workers by law and all registered workers are entitled to benefits such as minimum wage, maximum working hours, overtime pay and paid leave.

Employment Agreement

While the execution of a written contract to govern the employment relationship is not required under Brazilian law, it is a common procedure adopted by companies to provide more certainty to the parties.

Working condition

Regular working hours are limited to eight hours per day. The worker’s regular work schedule can be increased by overtime work but this cannot exceed the legal limit of two hours per day. Collective bargaining may also provider for higher overtime pay.

Leaves

National legal paid holidays must be observed. There are also moveable religious holidays which are generally observed by most and for which most businesses stay closed. States and cities may also have their own locally-observed holidays.

Employment termination

Termination of employment may be done in two ways: with cause or without cause. Dismissals must be notified to the employee in writing and the employer must register the dismissal and inform the relevant authorities.

30 days

Minimum notice period for terminating an employee

13 days

Total number of public holidays

44

Working hours per week

5 days

Total number of days for Compassionate & Bereavement Leave

Immigration

Brazil has agreements with approximately 90 countries in terms of visa exemptions. Citizens of countries that are not exempt from visas may apply for a business/tourism visa at the Brazilian consulate in their country of origin. These visas, which are valid for up to five years, allow for a maximum stay of 90 days, which may be extended.

Residency permits

Residence permits include those granted on humanitarian grounds. Traditional residence visas are granted such as family reunion visas. Those who hold a temporary residence visa may be entitled to obtain a permanent residence visa. Non-Brazilians who intend to invest in activities that generate jobs and wealth may also apply for a temporary residence visa alongside those who receive job offers in Brazil.

Work Permit Validity

2 years

Required Documents

work permit application form

applicant and candidate forms

company statutes or contractual alterations that are registered with the Commercial Board or Public Civil Registry

a document proving the appointment of the legal representative of the applicant

Compliant, reliable, error-free and touchless payroll in Brazil

Build the best team and hire top talent compliantly in Brazil. Get in touch with Brazil payroll outsourcing & PEO specialists for a free consultation!

This document was prepared for informational purposes only. As local laws & regulations keeps on changing. Please consult your tax & legal advisors as well.
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