The federal government's initiative program called Individual Entrepreneur is a public success. More than 10 million Brazilians have already become individual entrepreneurs, that is, owners of their own recognized and legalized business.
The great merit of the initiative has been to bring to formality a multitude of informal and needy entrepreneurs that exist in the country. The facilities presented to individual entrepreneurs are also inviting, as stated on the official government website, Portal do Empreendedor :
Right to register with the National Registry of portugal phone numbers Legal Entities (CNPJ), which will facilitate opening a bank account, applying for loans and issuing invoices.
Classification in Simples Nacional, being exempt from federal taxes (Income Tax, PIS, Cofins, IPI and CSLL).
Payment of only a small fixed monthly amount, which will be allocated to Social Security and ICMS or ISS. With these contributions, the individual entrepreneur will have access to benefits such as maternity assistance, sickness benefit, retirement, among others.
However, it's not all wonders. There are restrictions for anyone to meet the program's criteria. The main one is the need to not earn more than R$81 thousand per year and to have only one registered employee.
Looking at it in a cold-blooded way, this limitation can inhibit many individual entrepreneurs, leading them to not think big and not want to grow. From the moment your business evolves, you necessarily need to change categories. For many entrepreneurs, this can lead to a loss of competitiveness and make them slow down the growth of their company.
For those looking to structure their informal business and legalize the day-to-day running of the company, there is no doubt that it is worth joining the individual entrepreneurship.
However, for those who are thinking of starting a business that is much larger than R$81,000 in annual revenue, it will not be worth joining if, at some point, the entrepreneur hesitates as to whether it is more interesting to grow the company or leave it at the maximum size that is appropriate to continue meeting the program's criteria.
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