How it works, advantages and disadvantages

One of the essential points for a company to be able to make and execute good financial planning is the correct choice of the tax regime. In this sense, the Presumed profit It emerges as a simpler calculation alternative that can be used to depend on the size of the organization and sector of activity.

Basically, the tax regime is the set of laws that determines how the company will pay its taxes. Inhabilizing this aspect is important to reduce tax costs and at the same time ensure compliance with the obligations with the tax authorities.

In the case of presumed profit, the investigation of tax obligations is based on the company’s revenues and its main activity. Next, we will show the main points about this form of taxation – how it works, to those who apply, advantages and disadvantages and other important information for the company. Keep reading and check it out.

What is and how does the presumed profit work?

Presumed profit is a simplified form of calculation of and social contribution on net income (CSLL).

In this type of taxation, it is not necessary to determine net income to calculate taxes, as the calculation base is the company’s revenue. Regarding sales, the tax authorities applies percentages ranging from 1.6% to 32% to find the amount of taxes due – hence the expression “presumed”, as the taxable base is an estimated sales, not the exact value of the result of the exercise.

What are the taxes of presumed profit and how do they work?

The presumed profit covers taxes that can be calculated monthly and quarterly.

See how the calculation works in each case.

Monthly calculation

The taxes that must be calculated monthly by the presumed profit and their respective rates on the company’s revenues are:

• ISS (Service Tax): 2.5% to 5%, according to the municipality and service provided by the company;
• PIS (Social Integration Program): 0.65%;
• COFINS (Contribution to Social Security Financing): 3%.

Quarterly

The quarterly investigation falls on:

• Legal Entities Income Tax (IRPJ): 15%
• Social Contribution on Net Income (CSLL): 9%

In the case of the IRPJ, the 15% tax rate focuses on a presumption of profit by the tax authorities of 1.6% to 32%, according to the company’s sector, as follows:

If the presumed profit is over R $ 60,000 per quarter, there will be an additional 10% tax rate on income tax.

For the calculation of CSLL, the rates and sectors are:

Which companies can opt for presumed profit?

The system of presumed profit can meet various legal nature, such as, or limited company (LTDA), for example.

One of the requirements for the system is the value of annual revenues, which can not exceed R $ 78 million. In addition, the law determines other prohibitions to presumed profit, which are as follows:

• The company cannot have tax benefits;
• The company cannot receive resources or income from abroad;
• The regime does not apply to public companies, banks, financial, brokerages and other financial system organizations.

Also read:

Presumed profit, real profit, arbitrated and national profit: what is the difference?

So far, we have seen how presumed profit – concept, rates, tax scope and to those intended. Now we will show the main characteristics of the three other tax regimes that exist in Brazil. Check it out.

Real profit

In the real profit system, IRPJ and CSLL are calculated from the company’s adjusted net profit.

This means that the higher the profit of the year, the higher the amounts of taxes to be collected for the period. On the other hand, when the company prevails, there is no taxation in this tax regime – unlike presumed profit, which considers revenue (not the result) as a basis of calculation.

In real profit, rates are 15% for IRPJ and 9% for CSLL. As with presumed profit, IR will have an additional 10% rate on the value of profit that exceeds R $ 60,000 per quarter.

Arbitrated profit

In the arbitrated profit, the calculation of taxes is similar to that of the presumed profit – that is, the basis of calculation is a percentage of the company’s revenues. The difference is that the rates are 20% larger, and this type of taxation usually occurs due to extravision of documents or failures in accounting bookkeeping.

It is as if it were a sanction that the tax authorities impose on the company for breach of accounting rules. Regularized the pending issues, it can return to its original tax regime, and no longer has the additional 20% in the rates.

Simple national

Simples Nacional was created to serve companies with annual revenues of up to R $ 4.8 million. The purpose of this tax regime is precisely to reduce and simplify the tax burden of small enterprises.

In all, the simple covers eight taxes, from the federal, state and municipal spheres, and brings together the payment of all of them in a single guide – the Simple National Collection Document (DAS). The rates of this tax are in five tables (or annexes) and vary according to the company’s activity and revenue.

In addition to the revenue limit of R $ 4.8 million per year, other criteria for a company to be part of Simples Nacional are:

• It cannot be a corporation (s/a);
• The corporate framework must have only individuals;
• Partners must live in Brazil;
• There can be no delay tax obligations;
• Business activity should be included in one of Simples Nacional’s annexes.

How to calculate taxes on presumed profit?

As we have seen, IRPJ and CSLL rates in presumed profit depend on the company’s activity sector.

Suppose a commercial company has revenues of R $ 800 thousand in a given quarter. For trade, the IRPJ presumption percentage is 8%, and CSLL, 12%.

With this information, we can calculate the calculation bases and their values ​​of the two taxes:

1 – IRPJ Calculation

Calculation Base = R $ 800,000 (Billing) x 8% (presumption percentage) = R $ 64,000

IRPJ = R$ 64.000 x 15% = R$ 9.600

Additional rate = $ 4,000 (value over $ 60,000) x 10% = $ 400

IRPJ to collect = R$ 9.600 + R$ 400 = R$ 10.000

2 – Calculation of CSLL

Calculation Base = R $ 800,000 (Billing) x 12% (presumption percentage) = R $ 96,000

CSLL to collect = R$ 96.000 x 9% = R$ 8.640

3 – Calculation of ISS, PIS and COFINS

For a monthly revenue of R $ 250 thousand, consider that the ISS rate is 5% in the municipality. That way we have:

• ISS: R$ 250.000 x 5% = 12.500
• PIS: R$ 250.000 x 0,65% = R$ 1.625
• COFINS: R$ 250.000 X 3% = R$ 7.500

Advantages and disadvantages of presumed profit

One of the advantages of presumed profit is the simplification of tax writing.

Although it is important to maintain accounting and organized, it is not indispensable for the calculation of taxes in this system. As we have seen, it is the tax authorities who determine the calculation base, according to each percentage of profit presumption.

Companies with high profit margins can benefit from presumed profit. For example, if a retail trade company has a 20% profit margin, its taxable base becomes 8% with this regime.

Finally, the presumed profit allows companies to use the cash regime to investigate taxes. That is, the tax authorities considers as revenue the money that the company has actually received for sales.

This can be advantageous in certain situations, such as sales of high values ​​with longer deadlines. If the company uses the cash regime in this case, you can expect to receive the sale to pay the tax and earn breath to the.

On the other hand, those who opt for presumed profit have no right to tax incentives, such as slaughter of certain credits from the tax base. In addition, the system can result in a higher tax burden in certain cases, especially when the company has losses or operates with low profit margins.

Can you change the tax regime?

Yes, it is possible to change the tax regime within the deadlines determined by the IRS. Normally, this happens in January, but it is important to make tax planning before any change, considering the prospects for companies’ income and expenses.