If you are doing business in Brazil or planning to enter Latin America’s largest market, you may find that payroll outsourcing is a good option for your business. Because when you choose payroll outsourcing in Brazil, you relinquish a considerable administrative burden and enjoy the benefit of guaranteed compliance offered by the provider.
Furthermore, if that provider is a firm offering professional employer organization (PEO) services, rather than just an accounting firm, you will also have the opportunity to call on them for assistance with the recruitment of staff, as well as having the option of having the PEO provider hire staff on your behalf, either while you wait for your locally entity to be incorporated or as an alternative to actually starting a business in Brazil.
Note that a PEO firm can also be known as an employer of record (EOR), and may be referred to as a PEO payroll company, precisely because payroll outsourcing is one of the key services they offer.
If you would like to know more about how we can assist you with payroll outsourcing in Brazil, broader PEO services, or any other back-office support you may need, contact us today.
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Why choose payroll outsourcing in Brazil?
Brazil is a popular destination for foreign direct investment, thanks in part to the sheer size of its internal market, as well as the abundance of resources on offer – both in terms of raw materials and human capital.
As well as being famed for its agricultural output, mineral deposits, and well-developed manufacturing sector, Brazil has a ready supply of labor, as well as a growing middle class and an increasingly well-regarded professional sector.
However, doing business in Brazil is known for the sometimes convoluted red tape and administrative processes that can be time consuming – which can also mean considerable compliance issues.
That is why many investors and corporations choose to partner up with a local provider who knows the system well, is aware of every hoop that needs to be jumped through and can guarantee compliance.
That can be through the provisions of payroll outsourcing in Brazil, or through other back-office services, such as accounting and taxation or legal support. In many cases, investors will choose an integrated package of services to cover multiple such needs.
Payroll outsourcing in Brazil specifically refers to using a service provider to handle the management of the payroll for a group of employees. Often it is chosen for staff based in a different location to the company headquarters.
In many cases, investors opt for payroll outsourcing as part of a PEO services package because it allows for a faster market entry – given that it can be completed in only the time it takes to find the right staff.
It also means that the investor can avoid going through company formation and liquidation – a time-consuming and sometimes costly process that can make PEO a more economical option.
However, even when PEO services work out to be more costly, the convenience of avoiding the even heavier compliance burden of administering an entity and managing in-house staff means it is favored by many investors.
Some of the main tasks a payroll outsourcing company will be in charge of include:
- Clearing payments and tax procedures in a timely manner
- Undertaking calculations related to payroll and budget
- Managing information related to contracts and salaries
- Producing and delivering pay stubs
- Tracking and reporting on all of the abovementioned work
Additional benefits of payroll outsourcing
Beyond eliminating an administrative burden and guaranteeing compliance, some additional benefits of payroll outsourcing in Brazil include:
Local connections: When you hire a PEO firm for payroll outsourcing of employees they will find and hire on your behalf, you tap into a well established recruitment network run by people with knowledge of the likes of the best educational institutions and good local experience relevant to the role you need them for.
Legal support: Your payroll outsourcing provider will have a strong understanding of the regulatory framework within which they operate and have legal experts on staff who will be able to provide you with ongoing advice related to local corporate and employment law.
Productive focus: With your payroll taken care of, and potentially the recruitment and hiring of those staff should you choose a full package of PEO services, you will be freer to focus on more profit-oriented aspects of your business.
Calculate hiring costs with a payroll calculator
To get a general idea of the costs involved in payroll outsourcing in Brazil, you can use a payroll calculator. While it won’t necessarily provide perfectly accurate figures, it will give you a general idea of the tax burden and overall expense you will incur with a hire, as well as offering the opportunity to compare costs to other potential markets.
One example is the Biz Latin Hub payroll calculator, which will give an idea of costs related to employees in every market in Latin America and the Caribbean where the company has offices, allowing calculations based on:
- The country where you plan to hire
- The expected salary for a given employee
- The currency you wish to use (USD or local currency if not one of Latin America’s dollarized economies)
Bear in mind that the payroll calculator can only be taken as a very good indication of the costs you can expect to incur, with actual costs based on more complex calculations.
Biz Latin Hub can help you hire and manage overseas staff
At Biz Latin Hub, we provide market entry and back-office support to foreign corporations and investors throughout Latin America and the Caribbean. We can provide payroll outsourcing in Brazil as a stand alone service or as part of a hiring & PEO package.
Our portfolio of services also includes accounting & taxation, company formation, due diligence, legal services, and visa processing, among others, making us the ideal provider of integrated back-office support.
With offices in 16 markets around the region, we are also ideally placed to assist with multi-jurisdiction market entry and cross-border operations.
Contact us today to find out more about how we can assist you.
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