PIS as a Tax
The PIS/PASEP were established to promote the participation of the employees in the development of the companies. In practice, consists of a cash transfer program, aiming the better distribution of national income. This article will provide information about how those contributions are charged, what entities must pay them and at what rates.
The Programa de Integração Social (Social Integration Program) and the Programa de Formação do Patrimônio do Servidor Público (Program of Formation of the Patrimony of the Public Servants), better known by the acronyms PIS/PASEP are social contributions, payable by legal entities, in order to finance the payment of insurance unemployment allowance and participation in revenues from agencies and entities for public and private workers.
The employer is responsible for registering the employees on the program. Currently, the allowance and registration process for PASEP (public servants) is made by the Banco do Brasil, while the allowance and registration for PIS (employees of private companies) is done through the Caixa Econômica Federal bank.
Aliquots
The aliquots used to calculate the PIS/PASEP value will vary according to the company's segment of operations and its taxation arrangement (Lucro Real, Lucro Presumido or Simples Nacional). The calculation basis is the company's monthly income.
Simples Nacional
- Commerce and Industry: from 0.00% to 0.38%
- Movable property lease and Services : 0.00% to 0.57%
The Simples Nacional arrangement has an unique aliquot for all the taxes. But that does not mean that the companies are not paying the PIS contribution. The aliquots vary accordingly to the company's annual income. Consult all the taxes' aliquots for Simples Federal arrangement 2012 here
Lucro Real
Commerce, Industry and Services: 1.65%
Lucro Presumido
Commerce, Industry and Services: 0.65%
Discounting PIS from payroll
For the following non profit institutions, the calculation basis for the PIS/PASEP contribution is the total monthly payroll of wages of their employees and not the entity's income.
- Temples of any cult
- Political parties
- Some institutions of education and social assistance
- Philanthropic, recreational and cultural institutions as well as some scientific associations
- Unions, Federations and Confederations
- Autonomous social services, created or authorized by law
- Supervisory boards of regulated professions
- Foundations of private law
- Condominium homeowners or commercial
- Organization of Brazilian Cooperatives (OCB) and the Cooperative State Organizations
The monthly payroll includes amounts of income from employment of any kind, such as salaries, bonuses, commissions, additional function, allowance, working notice, additional vacation, five-year periods, night shift, overtime, 13th wages, paid weekly rest day and more than fifty percent of their salary.
The calculation basis do not include values related to: the family wage, the meal and transport tickets, the indemnified notice, vacations and sabbatical compensated, incentive pay as a result of adherence to Voluntary Dismissal Plan - the FGTS paid directly to the employee due to contract termination and other claims for exemption.
In these cases, the PIS aliquot to be calculated is at a rate of 1% over the payroll of the employees.
Exemptions
The following revenues are exempted from contributing to PIS/PASEP:
- Resources received as transfers, from the general budget of the Union, states, Federal District and municipalities to companies and public joint stock companies
- Exporting of goods abroad
- Services provided to individuals or legal entities resident or domiciled abroad, whose payment represents inflow of foreign exchange
- The supply of goods or services for use or consumption on board ships and aircraft in international traffic, when the payment is made in convertible currency
- The international carriage of goods or passengers
- Earned by Brazilian shipyards in construction activities, maintenance, modernization, conversion and repair of boats registered at the Special Brazilian Registry (REB)
- The freight of goods transported by ship from Brazil to countries abroad registered in the REB
- Sales from producer-seller to trading companies, provided for the specific purpose of exporting abroad
- Sales with the specific purpose of exporting to abroad by companies registered with the Secretariat of Foreign Trade, Ministry of Development, Industry and Foreign Trade.
- Revenues generated from the sale of electricity by the Itaipu Hydroelectric Power Plant.