INSS Patronal: calculation, rates and doubts

O INSS patronal is a topic that generates many doubts among entrepreneurs, HR managers and accounting professionals who need to keep payroll and social security obligations up to date.

From the legal nature to the tax rates and the possibilities for reducing costs, an in-depth understanding of the INSS patronal the difference in keeping the company in compliance, organizing cash flow and, where possible, paying less tax.

 

 

In this article, we'll explain what INSS patronal is, how it works on payroll, the main rates and calculations, as well as addressing special regimes such as the payroll exemptionand the importance of having a accounting office to ensure the best strategy.

If you want to understand how to calculate INSS patronal and the particularities of INSS patronal in the simple national systemRead on to find out how to manage this cost efficiently.

 

 

What is INSS patronal and why does it exist?

 

To begin with, it is essential to understand what is INSS patronal. THE INSS (National Institute of Social Security) is the body that administers Social Security in Brazil, offering benefits to workers such as retirement, sick pay, death pensions, among others.

The INSS Patronal, also called Employer's Social Security Contribution (CPP)is the contribution paid by the company (legal entity or equivalent) to Social Security for each employee.

• Why should the company pay?

The purpose of this contribution is to finance social security, guaranteeing resources to fund social security benefits.

Unlike the INSS withheld from the employee (which is deducted from the payroll), the INSS Patronal is borne by the company - it is an additional cost related to hiring labor. Thus, both the employee and the employer contribute to maintaining the social security system.

• Importance of INSS Patronal

O INSS Patronal directly impacts competitiveness and the ability to invest in hiring. It is one of the items that make up the social charges on the payroll, increasing the effective cost of each employee.

Knowing the details of the legislation and possible legal reduction mechanisms (such as specific tax regimes) makes a difference in managing company expenses.

 

INSS Patronal in practice: who pays and which activities are affected

 

In general, all legal entities that hire employees must pay the INSS Patronal on payroll. This includes:

• Business companies;
• Associations, foundations;
• Matched,
• Rural employers.

Even companies opting for Simples Nacional need to consider INSS patronal simples nacional in some situations, as Simples may (or may not) cover this contribution depending on the rules of the annex in which they fall.

 

 

 

Incidence on third-party services

 

It is worth remembering that, in certain cases, INSS is also withheld from services rendered via the assignment of labor, at specific rates (usually 11%), paid in advance.

In this context, the contracting company withholds this percentage and passes it on to the INSS on behalf of the service provider. This mechanism exists to ensure that social security contributions are paid by outsourced companies.

 

Special categories

 

Some specific groups, such as philanthropic organizations, have different rules regarding the INSS patronalThey can get an exemption if they meet the legal requirements.

There is also the possibility of exemption for selected sectors, making it possible to replace the contribution on payroll with a tax calculated on gross revenue - we'll talk about this later.

 

How to calculate employer's INSS on payroll

 

Know how to calculate employer's INSS on payroll is essential to avoid inconsistencies and labor liabilities.

Generally, the standard employer's INSS rate is 20% on the total remuneration paid to the employee, including salary and other payments (bonuses, overtime, commissions, etc.).

However, there are additional contributions aimed at financing accidents at work (RAT) and third parties (System S).

• 20% basic rate

This rate is levied on the gross value of the payroll: basic salary, legal bonuses and any remuneration that is part of the contribution salary.

So, if the company has ten employees, and the sum of their salaries is R$ 50,000.00, the basic rate will be 20% of R$ 50,000.00, i.e. R$ 10,000.00.

• RAT and other contributions

In addition to the basic rate, the company pays RAT (Environmental Risks at Work) - which varies from 1% to 3%, depending on the degree of risk of the activity.

There is also the payment of contributions to third parties (Sesi, Sesc, Senai, Sebrae, etc.), which can add a few more percentage points.

The total calculation must take these additional rates into account, resulting in many cases in a charge of between 25% and 28% on the payroll.

• Employee deductions (INSS withheld at source)

It is important not to confuse the portion paid by the company (INSS Patronal) with the portion withheld from the employee.

The employee contributes according to salary bands (from 7.5% to 14%), and this amount is deducted from net pay. The employer's contribution, on the other hand, is an additional cost for the company.

 

INSS Patronal in Simples Nacional

 

For those who opt for Simples, the legislation provides for the unification of several taxes in a single form (DAS), including federal taxes and, in some cases, the Employer's Social Security Contribution.

However, not all Simples annexes include the INSS employer. It is essential to analyze each annex to check whether the CPP is embedded or not.

Sometimes, a change in activity or the inclusion of new services alters the applicable annex, forcing separate payment of the employer's INSS and increasing costs.

Thus, a tax planning careful analysis is essential to know whether it pays to continue with Simples, migrate to Lucro Presumido or find another strategy.

 

 

Cases of payroll exemption

 

A payroll exemption is a government policy that authorizes certain sectors to replace the employer's social security contribution (20% on the payroll) with a rate levied on gross revenue.

The aim is to reduce the burden of hiring labor, encouraging job creation.

• Who can join?

The exemption is available to industries that employ a lot of labor, such as information technology, construction, freight transport and some others.

It is necessary to check the legislation in force to see if the company's activity is still covered, as this program usually undergoes periodic changes.

If there is a framework, substitution can considerably lower the INSS Patronal.

• Calculation on turnover

In this form of payment, the company pays a rate that varies (for example, 1% to 4.5%) on gross revenue, instead of 20% on payroll.

If payroll accounts for a large proportion of business costs, this brings significant savings. On the other hand, if the turnover is very high and the payroll modest, it may not be worth joining the exemption.

 

What are the consequences of not collecting properly?

 

Failure to pay or underpayment of the employer's INSS entails penalties and pending ancillary obligations, which may be reflected in:

Fines: Applied by Internal Revenue Serviceinterest and monetary correction, depending on the delay or inconsistency.

Filing for recoveryThe National Treasury Prosecutor's Office can file tax foreclosures, blocking the company's accounts and assets.

Loss of negative certificatesWithout tax compliance, the company is unable to obtain negative certificates and is prevented from taking part in tenders and signing contracts with various clients.

Labor riskIn a lawsuit brought by an employee, the company could be held responsible for not having paid the contributions, generating extra liabilities.

 

How to protect yourself against tax assessments

 

To avoid INSS patronalOne of the most important measures is to maintain the regularity of accessory obligations.

Companies must submit all the declarations (eSocial, SEFIP, DCTFWeb, among others) on time, ensuring that the information is in perfect harmony with the accounting entries and payrolls.

Another essential precaution is to keep files and tax receipts in a safe place to facilitate any inspections.

In the event of differences pointed out by Internal Revenue ServiceBy seeking immediate advice from an accountant, you can correct errors quickly, reducing fines and ensuring that you can continue your activities without legal setbacks.

 

Tax planning to reduce the employer's INSS

 

One of the best tactics for reducing INSS patronal is to compare scenarios. The accountant can create simulations projecting turnover, payroll, tax rates for each system and potential deductions.

This makes it clear whether Presumed Profit is more advantageous than Simples, whether the payroll justifies the exemption, among other factors.

• Adjust the workforce:

In some companies, using outsourcing or partnerships may be legally feasible to reduce the employer's INSS calculation base, but this must be within labor regulations so as not to constitute fraud.

Another possibility is to analyze whether a sector can be automated while maintaining a lean team. However, all these decisions must be based on a careful analysis of risks and costs.

• Separate activities into different CNPJs:

In businesses that bring together several lines of activity, it is possible to consider opening separate companies, one for each activity, each with a compatible tax regime. This is not uncommon in business groups.

However, formalization needs to be done well to avoid suspicions of simulation. The aim is to allocate payroll and revenue in such a way as to optimize the tax burden.

 

Special cases: cooperatives

 

It's not just companies that pay the employer's INSS. Work cooperatives need to analyze the impact on each cooperative member, following specific regulations.

In each scenario, it is vital to check the appropriate legislation and, preferably, to have the support of a specialized accountant so as not to make any mistakes.

 

INSS employer in practice: calculation examples and demonstration

 

It's common for professionals and companies to have doubts about how the calculation of the INSS patronal in practice. An example can clarify the process:

• PayrollSuppose that the total payroll of employees in a company (salaries, night bonuses, overtime) is R$ 100,000.00.

 

• 20% rateOn this amount, the basic rate of 20% is applied, resulting in R$ 20,000.00.

 

• RAT and other entitiesIf the company is in a sector with a RAT of 2% and third-party contributions of 5.8%, for example, the additional amount would come to a further R$ 7,800.00.

Thus, the total sum of INSS Patronal and other contributions could exceed R$ 27,000.00.

This calculation makes it clear how significant labor costs can be for some sectors, depending on factors such as degree of risk, number of employees and tax regime.

For this reason, it is important to analyze each component to check whether it is able to benefit from regimes such as Simples Nacional (when applicable) or payroll exemption in certain segments.

Only by taking all these aspects into account is it possible to predict the final cost of labor more accurately and adopt strategies that prevent surprises at the checkout.

Ideally, the company should rely on the guidance and advice of a accounting office specialized, avoiding mistakes that could result in tax assessments or undue tax payments.

 

How the HR department can optimize the employer's INSS

 

HR (Human Resources) plays a fundamental role in controlling and managing the INSS patronal.

Although it is usually associated with the accountant or the financial sector, HR's joint role in defining job and salary policies, scaling benefits and managing working hours can have a direct influence on the final payroll figure.

• Benefits policies:

The company can choose to grant certain benefits (such as food vouchers or health plans) on a non-wage basis, preventing them from being included in the INSS calculation base.

However, it is necessary to respect labor legislation and union agreements to ensure that the benefits are in fact compensatory and do not constitute a disguised salary.

• Journey management:

Keeping a close eye on overtime and work schedules is important to curb excessive payroll growth.

Internal time bank programs, provided they are legally instituted, can inhibit or reduce the continuous payment of overtime, reducing the calculation basis for the INSS Patronal.

• Training and qualification:

Although it may not seem like it at first glance, investments in training and qualifications can reduce the degree of risk involved in some activities.

In practice, this impacts the rate of Environmental Risks at Work (RAT)by reducing costs in the social security contribution.

Working collaboratively between HR and accounting makes it possible not only to fulfill obligations accurately, but also to gain strategic insights into payroll distribution, benefit configurations and working arrangements that lead to savings in social security charges.

 

Impact of the tax reform on the employer's INSS

 

From time to time, tax reform proposals emerge in Brazil that could affect the INSS patronalThis can be done by altering the tax rates, changing the way it is paid or even integrating it into a unified tax.

Although there is no reform related to the employer's INSS under discussion at the moment, it is important to follow the discussions, as any change in legislation could create opportunities or challenges in labor cost management.

Possible unification of taxesSome proposals discuss merging taxes such as PIS, COFINS, IPI and part of the social security contribution into a single tax on goods and services.

In this scenario, the INSS Patronal could migrate to another calculation basis, having a profound impact on labor costs.

Reduction or increase in tax ratesThere is also speculation about reducing the tax rate on payroll and offsetting it with taxes on financial transactions or turnover.

Depending on the sector, this could be beneficial or harmful. For example, labor-intensive companies could benefit from a lower payroll tax, while those with a high volume of financial transactions would pay more.

Maintaining the exemption: In some projects, the payroll tax exemption is maintained or even extended in order to encourage the hiring of formal workers.

Continuing or expanding this program could significantly reduce the employer's INSS burden for selected companies.

What is clear is that any structural change in the national tax system will require new adjustments and strategy reviews on the part of companies.

Therefore, keeping up to date with legislative discussions and relying on specialized accounting advice can be the best way to prepare for any changes.

In this way, it will be possible to evaluate ways of reducing charges without breaking the law and preserving the organization's financial stability.

 

Conclusion

 

Achieving the goal of pay less tax is to understand how the employer's INSS works, which tax regime to choose and how to take advantage of any incentives or exemptions.

This path requires organization, well-structured accounting records and up-to-date tax planning.

In many cases, the employer's INSS is one of the main payroll costs and can jeopardize cash flow if it is not sized and managed correctly.

The good news is that there are concrete solutions: from changing tax regimes to applying the payroll tax exemption or adjusting hiring and profit distribution strategies.

Each case requires a particular study, correlating turnover, number of employees, profit margin and sector of activity. That's why it's not enough to adopt generic solutions. The ideal is to have accounting support to design the best approach.

 

Discover the services of CLM Controller Accounting

 

If you need expert advice on planning your contributions, take advantage of the payroll exemption and find legitimate ways to pay less tax, the team at CLM Controller Accounting is at your disposal.

We are specialists in tax regimes, exemption analysis and accounting management, offering customized solutions to optimize your business's tax burden without neglecting legal compliance.

Contact us and find out how we can help!