Easily manage employment in Brazil

Payroll services in Brazil

Brazil has a diverse economy with key industries in agriculture, manufacturing, and services. With complex labor laws and tax regulations, employers in Brazil must ensure compliance with local payroll requirements, including social security contributions, employment contracts, and tax obligations. Understanding these regulations is essential for smooth payroll operations and legal compliance.

Payroll breakdown in Brazil

Employers in Brazil must adhere to national payroll regulations regarding wages, taxes, and social contributions. Below is an overview of key payroll components:

Minimum wage and working hours

• Minimum wage: Brazil’s minimum wage is BRL 1,412 per month.
• Payroll frequency: Salaries are generally paid monthly.
• Standard working hours: The normal workweek in Brazil is 44 hours, typically spread over five or six days.
• Overtime: Employees are entitled to additional pay for overtime work, calculated at 150% of the regular wage for extra hours and 200% for work on public holidays.

Taxation and social security contributions

• Personal income tax: Brazil has a progressive income tax system with rates ranging from 0% to 27.5% depending on income levels.
• Employer contributions:
• Social security (INSS): Ranges from 20% to 22.5% of the gross salary.
• Severance Fund (FGTS): 8% of the gross salary.
• Employee contributions:
• Social security (INSS): Ranges from 7.5% to 14% of the gross salary.
• Corporate tax: The corporate income tax rate in Brazil is 34% (including additional levies).
• Tax reporting: Employers must file payroll taxes and contributions with the Receita Federal do Brasil regularly.

Payroll compliance in Brazil

• Employment contracts must be provided in writing and specify terms such as salary, working hours, and job responsibilities.
• Payroll deductions: Employers must ensure accurate deductions for social security and income tax.
• Employers must stay updated on changes to Brazil’s labor laws and tax regulations to avoid penalties.

Quick facts: Important considerations for employers

• Payroll frequency: Salaries are generally paid monthly.
• Currency: Payroll in Brazil is processed in Brazilian Real (BRL).
• Tax reporting: Employers must file payroll taxes and contributions with the Receita Federal do Brasil.
• Payroll deductions: Employers must ensure accurate deductions for social security and income tax.
• Payroll compliance: Employers must stay updated on changes to tax rates and reporting requirements.

Run payroll in Brazil with Remote

Managing payroll in Brazil requires careful attention to tax regulations, employment laws, and social security requirements. Employers must stay informed about tax rates, wage laws, and reporting deadlines to ensure smooth payroll processing and avoid penalties.

The good news is, you can pay anyone, anywhere — from your team in the office to your team abroad, all with Remote Payroll. To see just how easy global payroll can be with Remote, book a demo today.