SUCCESS, TOGETHER
Our staff are experts in fields ranging from operations, payroll, accounting, and more. Learn what you need to expand your business and hire staff in Brazil.
Photo by Agustin Diaz Gargiulo
Brazil is the fifth largest country in the world and occupies nearly half the land area of South America. Brazil is a world giant of mining, agriculture, and manufacturing, with a powerful and quickly growing service industry
Employees can be majorly divided into two categories – Contractors and Employees and defining relation with the employee is very important to avoid risks associated with misclassification.
The courts in India have applied the control and integration test to determine whether a person can be classified as an employee or independent contractor. The prima facie test is the control test to determine whether an employer-employee relationship exists and it is not merely to direct the nature of work that has to be carried out but also to control the manner in which it is done.
Another difference between an employer and contractors is an employer is required to withhold tax at the time of payment of salary to employees. The salary paid to an employee may include benefits and allowances that the employee is entitled to, which is beneficial to the employee from a tax perspective. However, with respect to independent contractors, the employer must withhold the applicable taxes; however, the amount paid may not be in the form of salary, but as professional fees for services performed. In both these cases, the employee and independent contractor/s will be required to file their income tax returns as prescribed under law.
The payroll cycle in Brazil is generally either bi-weekly or monthly and employees are paid on the 15th and 30th of each month. There are no provisions in the law regarding 13th salaries.
Date | Holiday |
Jan. 1st | New Year’s Day |
Jan. 20th | Saint Sebastian (only Rio de Janeiro) |
Jan. 25th | Foundation of the city of São Paulo (São Paulo only) |
April 21st | Tiradentes Memorial Day |
April 23rd | Saint George (only Rio de Janeiro) |
May 1st | Labor Day |
July 9th | Constitutional revolution (São Paulo only) |
Sept. 7th | Independence Day |
Oct. 12th | Apparition of the Blessed Mother Mary |
Nov. 15th | Proclamation of the republic |
Nov. 20th | Remembrance Day to Blacks (not nationwide) |
Dec. 25th | Christmas Day |
Date | Holiday |
March 1st | Carnival |
April 15th | Good Friday |
April 17th | Easter Sunday |
May 26th | Ascension (only Rio and São Paulo) |
June 5th | Whit Sunday |
June 16th | Corpus Christi |
Mandatory employee benefits in Brazil include workers’ compensation, disability, life insurance, and Paid Time Off (PTO) in situations such as maternity and paternity leave, among others. Desired supplementary employee benefits in Brazil include medical and dental care, private retirement plans, and life and disability insurance.
Resident taxpayers who receive income from Brazilian sources are subject to withholdings. Resident taxpayers who receive income from non-Brazilian sources (e.g. through split payroll arrangement) or from individuals (e.g. rental income) are subject to mandatory monthly tax payments on amounts not subject to withholdings.
The monthly income tax will be calculated based on the following progressive tax rates (in Brazilian real or BRL) as of April 2015:
In Brazil, employments are at will, meaning that any party may terminate the employment agreement without cause upon the mandatory prior notice and payment of the severance. It is not necessary to mention any reason for termination, except if it is a termination with cause.
Please drop us an email below to let us know how we could help you fulfill your global workforce needs. We would love to share more about our capabilities and start a conversation.