The three steps to Set Up a Company in Brazil
Owner of the largest economy in Latin America in terms of GDP and the second in all of America, the sixth worldwide according to the IMF and the World Bank.
According to estimates by the IMF, the Bank of the South, and the World Bank, the Brazilian economy in the coming decades should be among the five largest powers in the world, along with China, the United States, India, and Mexico, being an ideal field for business.
This economy is highly diversified and has become one of the main in the world, as of 2003, highlighting the following sectors: agriculture -world leader in coffee production-, mining -precious stones-, manufacturing -military equipment, electronics, cars, planes- and services -tourist power-.
Its GDP is the ninth highest in the world and the country has the sixth-largest population. At the individual level, Brazil has one of the largest middle classes in the world and tends to continue its expansion based on solid democracy and regulatory institutions. Thus, the possibilities of consumption, and with it, the possibilities of sales, increase every year.
Concerning to the tax system, the Brazilian tax regulations allow independent fiscal powers to the federal, state, and municipal governments to impose, regulate and collect taxes, constituting another advantage for those entrepreneurs who decide to undertake in this country.
In the case of deciding to set up a company, the three general steps are detailed below, it should be noted that depending on the type of business, some questions may vary:
1 Select the business entity model: you can choose between several types of companies such as Limited Liability (Limitada / Ltda), Public Limited Company (S.A.), Sole Proprietary Entities (EIRELI), Sole Entrepreneur (MEI), and some others.
So once you've selected the right one for your business, it's time to move on to the next step.
2 Register / Present Bylaws: Your company's bylaws must be filed with the state trade board in one of the 27 Brazilian states (each has its trade board). This registration will activate another required in the Department of Internal Revenue Services of Brazil (RFB - Receita Federal Brasileira). After that, you will get a federal tax identification number, which will allow you to open a bank account and receive foreign investment.
Also, if a foreign company is one of the shareholders of the Brazilian company, the registration of the foreign company with the Central Bank of Brazil and the Department of Internal Revenue Services is required.
3 Definitive registrations and permits: Depending on the sector in which your company will operate and your type of business (services, industry, retail, etc.), it will be necessary to register your company with the State Finance Secretariat (Secretarías de Fazenda - SEFAZ) or municipal department (Municipalities) to obtain your state, and / or municipal tax identification numbers. After that, some permits will be needed depending on the goods or services your company will provide (food, health, education, finance, etc.). Normally, that you need 4 different permits to operate, such as the municipal firefighter, the health regulation department, the state environment department, etc.
Finally, after your company is constituted, you must comply with local tax, accounting, and payroll regulations, so you will need a team to control it, a task where Creimerman Law applies its personalized control service to obtain the best results.
We can accompany you at each stage, starting with the evaluation of your idea of creating a company, indicating in detail what type of business suits you and the requirements, while we will try to apply the tax regulations that do not stop your business.