Brazil Social Contributions Guide

INSS — Employee Contribution (7.5% to 14% Progressive)

• Progressive brackets for 2026: The INSS employee contribution follows a progressive bracket system. For 2026, the monthly salary brackets and rates are approximately: (a) up to R$ 1,xxx — 7.5%, (b) R$ 1,xxx to R$ 2,xxx — 9%, (c) R$ 2,xxx to R$ 4,xxx — 12%, (d) R$ 4,xxx up to the INSS ceiling of R$ 14,xxx — 14%. Each bracket applies only to the portion of salary within that range.
• INSS ceiling (teto do INSS): The maximum salary subject to INSS employee contributions is approximately R$ 14,xxx per month for 2026 (adjusted annually by the National Consumer Price Index — INPC). Any salary above this ceiling is not subject to INSS deductions.
• Employer deduction at source: The employer deducts the INSS employee contribution directly from the monthly salary and remits it to the Receita Federal do Brasil (RFB) together with the employer's own INSS contribution. The contribution is reported on the eSocial system.
• Self-employed contribution: The self-employed individual (contribuinte individual) must contribute to INSS at the rate of 20% of the monthly income (or 11% under the simplified plan — the "plano simplificado" — on the minimum wage). The self-employed contribution is deductible as an operating expense.

For example: an employee earning R$ 10,000/month in 2026 would pay INSS at 7.5% on the first bracket, 9% on the second, 12% on the third, and 14% on the portion up to the ceiling. The total INSS employee contribution is approximately R$ 900 to R$ 950 per month.

Employer INSS — 20% on Payroll

• Standard rate — 20%: The employer must contribute 20% of the total gross payroll to INSS. This includes all employees, domestic workers, and rural workers. The 20% rate applies to the total salary amount without a ceiling — unlike the employee contribution which is capped at the INSS ceiling.
• Additional contributions: Certain sectors have additional employer INSS contributions: (a) the financial institutions — additional 2.5% to 3.5%, (b) the construction companies — additional 2% for the accident prevention fund, (c) the rural employers — reduced rates under the "Funrural" regime.
• No ceiling for employer INSS: The employer INSS contribution of 20% applies to the full salary amount with no maximum limit. For example, an employee earning R$ 30,000/month costs the employer R$ 6,000/month in employer INSS alone.

FGTS — 8% Employer Contribution

• Rate — 8%: The employer must deposit 8% of the employee's gross monthly salary into the FGTS account (a blocked savings account in the employee's name at Caixa Econômica Federal). The FGTS is the "Fundo de Garantia do Tempo de Serviço" — the "Length of Service Guarantee Fund".
• Additional 10% on termination without cause: When the employer terminates the employment without just cause (dispensa sem justa causa), the employer must pay an additional 40% penalty on the total FGTS balance accumulated during the employment period. From 2026, the penalty may be adjusted under the new labor reform rules.
• FGTS withdrawal conditions: The employee may withdraw the FGTS balance in specific circumstances: (a) the termination without just cause, (b) the retirement, (c) the purchase of a first home, (d) the serious illness (cancer or HIV), (e) the annual birthday withdrawal option (saque-aniversário).

RAT — Risk Rating for Workplace Accidents (1% to 3%)

• Rate based on risk level: The RAT (Risco Ambiental do Trabalho) — formerly known as the SAT (Seguro de Acidente do Trabalho) — is the employer contribution for the workplace accident insurance. The rate is based on the economic activity's risk classification: (a) 1% for low-risk activities (e.g., administrative offices, technology), (b) 2% for medium-risk activities (e.g., commerce, manufacturing), (c) 3% for high-risk activities (e.g., construction, mining, transportation).
• RAT adjustment by FAP: The RAT rate is adjusted by the FAP (Fator Acidentário de Prevenção) — a multiplier between 0.5 and 2.0 based on the company's accident history. For example, a company with a low accident rate may have a FAP of 0.5 (reducing the effective RAT to 0.5% to 1.5%), while a company with a high accident rate may have a FAP of 2.0 (increasing the effective RAT to 2% to 6%).
• Combined employer cost: The total employer social contribution is: Employer INSS (20%) + FGTS (8%) + RAT adjusted by FAP (1% to 6% effective). For a low-risk company with FAP 0.5, the total employer cost is approximately 20% + 8% + 1% × 0.5 = 28.5% of payroll. For a high-risk company with FAP 2.0, the total is approximately 20% + 8% + 3% × 2.0 = 34% of payroll.

FAQs

Are INSS contributions tax-deductible?

The employee INSS contribution is deductible from the personal income tax (IRPF) as a compulsory deduction. The employer INSS and FGTS are deductible as operating expenses for the corporate income tax (IRPJ/CSLL). The self-employed INSS contribution (20%) is deductible as an operating expense.

Do foreign workers pay INSS?

Yes. The foreign workers employed in Brazil under a valid work visa (visto de trabalho) are subject to the same INSS, FGTS, and RAT rules as the Brazilian employees. The foreign workers on assignment may be exempt under the social security totalisation agreements that Brazil has with certain countries (e.g., the Mercosur countries, the Portugal, the Spain, the Italy, the Japan).

What is the INSS ceiling for 2026?

The INSS ceiling for 2026 is approximately R$ 14,xxx per month (the exact value is adjusted annually by the INPC index in January). The salary above this amount is not subject to the employee INSS contribution but remains subject to the employer INSS contribution.