How does INSS work for Simples Nacional companies?

Understanding how the INSS works for Simples Nacional companies is essential to keeping the company compliant and avoiding undue payments. Depending on the activity carried out, the number of employees and whether the partners receive a salary, social security obligations can change.

In many companies opting for Simples Nacional, the employer's INSS is already included in the DAS. In others, especially in activities included in Annex IV, the employer's contribution must be paid separately. In addition, the company may also have obligations relating to the INSS of employees and partners.

In this guide, you will understand what the INSS is, how the contribution works for Simples Nacional companies, when the employer's INSS is included in the DAS, when it needs to be paid separately and what precautions need to be taken with employees and pro-labore.

Listen to our podcast, in which Rodrigo and Ana have an uncomplicated chat about how the INSS works for Simples Nacional companies and explain the main points on the subject.

Quick summary: how INSS works in Simples Nacional

• Simples Nacional companies with activities listed in Annexes I, II, III and V generally pay the CPP through the DAS.
• Companies included in Annex IV must pay the employer's INSS separately on payroll and pro-labore.
• If there are employees, the company must withhold and pay the employee's INSS.
• If there is a pro-labore, INSS is also levied on the partners' remuneration.
• Even without employees, the partner can contribute to the INSS to maintain their social security protection.

What is the INSS and what is it for?

O National Institute of Social Security (INSS) is the body responsible for Social Security in Brazil. It administers contributions and benefits such as pensions, sickness and maternity benefits, among others. In simple terms, the INSS works like a social insurance: workers and companies contribute monthly, and these contributions finance the benefits paid to insured people.

In practice, the INSS functions as a social protection system. Workers, companies and individual taxpayers make regular contributions and, in return, can access social security benefits when they meet the legal requirements.

For Simples Nacional entrepreneurs, understanding these rules is indispensable, because the company may have payroll, pro-labore and employer contribution obligations, depending on the form of taxation and the activity carried out.

How INSS works for Simples Nacional companies

In Simples Nacional, taxes are collected in a unified manner through the DAS. In many activities, the employer's social security contribution, also known as CPP, is already included in this form. This simplifies the tax routine and avoids the separate payment of the 20% employer's contribution on the payroll.

But this rule does not apply to all companies. INSS treatment depends on three main factors:

• whether the company has employees or not;
• if the partners receive a pro-labore;
• which Simples Nacional annex the activity falls under.

Therefore, in order to correctly understand the INSS in Simples Nacional, it is important to separate the most common scenarios.

Read also: Interest Simples Nacional, how to calculate overdue DAS

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Simples Nacional companies without employees

When a company has no registered employees, it does not have to pay the employer's contribution on payroll, because there is simply no payroll. Even so, this does not mean a total absence of social security obligations.

If partners work in the company, it is advisable to evaluate the withdrawal of profits. Social security contributions are levied on this amount, which helps guarantee future access to retirement and other INSS benefits.

For example, if the partner earns a pro-labour of R$ 2,000.00, they will be discounted R$ 220.00 (corresponding to 11%) to the INSS. This amount must be paid monthly using a specific form (GPS or INSS DARF).

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If there is no pro-labore withdrawal, the company may not have to pay social security directly that month, but the partner will also no longer contribute to their social security protection, unless they contribute in another way.

Simples Nacional companies with employees

When a company has registered employees, two main obligations come into play:

• the deduction of the employee's INSS from the payroll;
• the company's employer contribution, where applicable.

The employee's INSS is withheld monthly from their salary and paid by the company. The employer's contribution, on the other hand, can be included in the DAS or paid separately, depending on the Simples Nacional annex the company falls under.

In other words, every company with employees has a social security obligation. What changes in Simples is the way the employer's contribution is handled.

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Simples Nacional Annexes and the INSS Patronal (CPP)

One of the most important points about INSS in Simples Nacional is to understand whether or not the CPP is included in the DAS.

In Annexes I, II, III and V, the employer's social security contribution is generally already included in the Simples Nacional rate. This means that the company does not have to pay the 20% employer's contribution on the payroll separately.

In Annex IV, the situation is different. The CPP is not included in the DAS. In this case, the company must pay the employer's INSS separately, following the rules applicable to other taxpayers.

Practical summary:
Annexes I, II, III and V: PSC normally included in the DAS.
Annex IV: CPP collected separately on payroll and pro-labore.

Companies that do not normally pay separate CPP

Companies included in Annexes I, II, III and V usually have the CPP included in the DAS. This covers, for example, commerce, industry and various types of service provision.

In these cases, the company still needs to take care of the INSS deducted from employees and partners, when there is a payroll, but the employer's share of the payroll is usually already included in the unified Simples document.

Companies that pay CPP separately: Annex IV

Annex IV companies must pay the employer's social security contribution outside of the DAS. This means calculating 20% on the payroll and, depending on the case, also taking into account additional charges such as RAT and contributions to third parties.

Among the most common examples of activities falling under Annex IV are construction, surveillance, cleaning, conservation and legal services.

This list is illustrative. The correct classification depends on the activity actually carried out and the applicable legislation. If in doubt, it is important to validate the annex with accounting support.

INSS on partners' salaries

Pro-labore is the remuneration paid to partners who act in the management or operation of the company. When there is a pro-labore, INSS is levied on this amount.

In Simples Nacional, the partner's contribution on pro-labore remains a relevant obligation, regardless of whether the company has employees or not. What may change is the incidence of the employer's share, especially if the company is in Annex IV.

That's why pro-labore needs to be treated carefully within the company's tax and social security planning.

INSS rates and contribution bands

The INSS rates for employees follow the current social security table and are applied progressively according to the salary range. The employer's contribution follows the logic of the company's classification in Simples Nacional and the corresponding annex.

In the case of partners, the tax is levied on the pro-labore. The percentage applied depends on the method of payment and the legislation in force during the calculation period.

As these ranges and limits can be updated periodically, the recommendation is to always review the table in force for the current year and avoid keeping outdated time mentions in the body of the article.

Differences: employer's INSS, withheld INSS and partner's contribution

• INSS employer: company contribution on the payroll, which can be included in the DAS or paid separately.
• INSS withheld from the employee: amount deducted from the employee's salary and collected by the company.
• INSS of the partner: contribution levied on the pro-labore of the partner who works in the company.

This separation is important because many doubts arise precisely because of the confusion between these three incidences.