To start a business in your small business, you need to choose between two modalities: MEI and Simples Nacional.
Estimated reading time: 3 minutes
A survey carried out by the Brazilian Institute of Quality and Productivity (IBQP) and by Sebrae, showed that Brazil recorded long-term growth in entrepreneurship.
To start a small business, it is necessary to choose between two modalities: Individual Microentrepreneur (MEI) and Simples Nacional. To do this, you need to know how each of them works.
Simples Nacional is a tax regime, where micro and small companies can be classified, as long as they respect certain conditions.
The main condition is the revenue limit: the gross revenue to qualify for the regime is R$ 4.8 million per year for small companies, which corresponds to an average monthly revenue of R$ 400 thousand. Micro-enterprises can earn up to R$360,000 annually.
Through Simples Nacional, the company pays a single rate, which covers all taxes it must collect (both federal, state and municipal), which facilitates and reduces bureaucracy. To know the amount of the tax, it is necessary to use the Simples Nacional table and consult the gross revenue range of the last 12 months in which the company falls.
In this modality, the company has the obligation to show the government its bookkeeping, where all its financial transactions are presented over the established period.
The Individual Microentrepreneur (MEI) is an individual entrepreneur, who performs economic activity in his own name. Thus, it does not have a social contract and cannot have a partner either. To be a MEI, you must meet the following requirements:
- Have revenue limited to R$ 81 thousand per year;
- Not to participate as a partner, administrator or owner of another company;
- Hire a maximum of one employee;
- Exercise one of the economic activities allowed to MEI.
The MEI does not need to do bookkeeping, however, according to its activity, every MEI needs to pay a monthly contribution. Through this single monthly payment, the microentrepreneur contributes to Social Security, collects ICMS and ISS.
The MEI has access to social security benefits, such as retirement by age, maternity leave, sick pay, among others, in compliance with the grace periods. The contribution to the INSS is readjusted whenever there is an increase in the minimum wage.
MEI has the obligation to make the Annual Declaration of Invoicing of Simples Nacional (DASN – SIMEI), which takes place until May 31 and corresponds to the year of the previous year.
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