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Payroll taxes in Brazil

Last verified: 2026-10-25

Employers pay 20% social security (INSS) on total payroll, plus a 1% to 3% occupational risk contribution (RAT) and an 8% FGTS deposit for each employee, before third party contributions. Sectors that used the revenue based payroll relief regime are moving back to the payroll base between 2025 and 2027.

The rule

1. The employer contribution is 20% of total remuneration paid, due or credited during the month to employees and casual workers.Law 8,212/1991, art. 22, item I, 1991-07-24 official text
2. The occupational risk contribution (RAT) is 1%, 2% or 3% of payroll depending on whether the company's main activity has light, medium or serious accident risk.Law 8,212/1991, as amended by Law 9,732/1998, art. 22, item II, 1991-07-24 official text
3. Employers must deposit 8% of each employee's prior month remuneration into an FGTS account by the 20th of each month.Law 8,036/1990, art. 15, 1990-05-11 official text
4. For companies in the revenue based regime (CPRB), the transition is: in 2025, 80% of the CPRB rates plus 25% of the 20% payroll rate; in 2026, 60% plus 50%; in 2027, 40% plus 75%. During 2025 to 2027 the payroll portion does not apply to the 13th salary.Law 12,546/2011, inserted by Law 14,973/2024, art. 9-A, 2024-09-16 official text
5. LC 224/2025 includes employer social security contributions among the federal tax benefits cut by 10%.Complementary Law 224/2025, art. 4, para. 1, item VI, 2025-12-26 official text

Worked example

Monthly payroll of BRL 100,000 (about USD 19,850) in a company with a 2% RAT. Employer INSS 20%: BRL 20,000. RAT 2%: BRL 2,000. FGTS 8%: BRL 8,000. Total BRL 30,000 (about USD 5,955), or 30% of payroll, before third party contributions and employee withholdings. USD at the BCB PTAX selling rate of 23 October 2026, BRL 5.0377 per USD.

Step by step

  1. Register the company and employees in eSocial before the first payroll.
  2. Determine the RAT rate from the main activity code.
  3. Check whether the company is in the CPRB transition and apply the 2026 split.
  4. Pay INSS through DCTFWeb and FGTS through FGTS Digital monthly.

Common traps

  • Budgeting only salary: employer charges and the 13th salary and vacation bonus add significantly.
  • Misclassifying workers as contractors, which creates INSS and FGTS exposure.
  • Assuming payroll relief continues past 2027.

Sources

Related pages

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