The term Pro labore refers to "by work", remembering that in several languages, the word work derives from the Latin "labor". In short, it means the salary collected by the managing partners of a company, regardless of the position occupied. In Brazil, you must collect 11% for INSS in National Simples and 31% in Presumed Profit.
What is pro-labore?
Is it mandatory to have a pro-labore?
What are the differences between pro-labore and salary?
What are the differences between pro-labore and profit distribution?
How to calculate the profitability of managers?
Many entrepreneurs look for LIGHT with difficulties in cash flow management. In explaining the difficulties, we usually realize that these entrepreneurs do not have pro-labor policies, distribution of profits e reinvestment in the company.
Okay ... But what does that mean?
It means that the salary of these entrepreneurs is totally variable and depends on the moment of the company, without any financial planning. In other words, if the company goes well three months in a row, the partner-managers end up taking more out of the company's cashier for your personal accounts. And they forget that the company can have a bad period next.
For this problem to be solved, entrepreneurs need to pro-labore monthly fixed. At the end of longer periods (6 months or 1 year), they must also have defined how much of the profit will be distributed and how much will be reinvested in the company.
When we explained this solution, we realized that the doubts had only begun. And the first of them is "What is pro labore?". This question is the main motivation for our article today. So get ready. You're 5 minutes away from having all your questions on the subject healed!
O pro labore nothing is more than the salary for the work of a company administrator, be it partner, owner, director, advisor. At the time of incorporation of the company, some partners are determined as administrators. It could be just one or even all of the partners, actually. While other partners are capitalists, they invest money in the business.
The managing partners are those who enter into society with work. Capitalists come in with money invested. The administrators will be those who will have pro-labore and participate in the distribution of profits. The capitalists will only participate in the distribution of profits.
Think about the following situation. Two friends want to open a bar. One has only $ 10 thousand to invest, but is unemployed and has free time. The second has a fixed job, but has R $ 90 thousand to invest. Together, they invest R $ 100 thousand and define that the first will work in the business.
The natural way would be to define a pro-labore for the first partner. And, at the end of the year distribute the profits of the business, 10% to the managing partner, who invested R $ 10 thousand, and 90% to the capitalist partner, who invested R $ 90 thousand.
And what are the rules of Pro Labore?
There is no law of minimum value for labor. But based on the INSS table, so that a taxpayer is entitled to Retirement, the indicated is that the minimum is equivalent to the minimum wage.
Regarding pro-labore there are no compulsory rules, such as the thirteenth, vacation and FGTS contribution. However, there is incidence of INSS. When the company is opting for Simple National, the administrator should contribute with 11%. Not being opted for the Simple, in addition to the individual contribution of the entrepreneur, there is also the employer contribution, 20%. Totalizing 31%.
You will read in some places that you do not. But, but due to the obligation of social security contribution, it is compulsory to pay pro labore to members of a company who carry on an activity therein. If pro-labore is not cleared, only distribution of profits, the company runs the risk of the entire amount being taxed retroactively.
Typically, companies try to evade the payment of pro labore, to avoid duplicate taxation. Clarifying ... A member who receives by distribution of profits will have his salary paid after the calculation of the profits of the company. Therefore, the values will not have incidence of more taxes. If it receives by pro labore, it will have an incidence of employer INSS, of 20% and in physics of 11%.
In this case, it is recommended that your pro-labore is the smallest possible, leaving most of its compensation due to the distribution of profits at the end of the period.
Even so, this is considered a risk, since a possible inspection will be able to obtain that the pro-labore paid is well below the salaries in the market for the activity carried out by the partner-administrator in question.
The two have more similarities than differences. For example, both are monthly and have fixed values. The first difference is the beneficiary. Wages are paid to workers, while pro-jobs are paid to contract administrators. Usually partners who carry out an activity in the company.
The other and main differences are related to the incidence of benefits and labor charges. These are mandatory for employees and not mandatory for administrators. Below are some examples of the incidents cited:
- 13º Salary
As the member can not be considered an "employee of his own", labor benefits are optional, as long as its rules are explicit in the company's social contract.
Another similarity between wages and pro labore is the incidence of compulsory INSS. As mentioned above, 20% of employer contribution (for companies not registered in the National Simple) and 11% of individual contribution.
The only similarity between pro labore and distribution of profits are the beneficiaries: the members of a company. Being that, only those considered administrators in the contract, will receive pro labore. However, all will receive distribution of profits.
The differences are many. Starting with the monthly frequency and fixed value of pro labore. The distribution of profits occurs at the end of the year, provided the company is profitable and has its regular accounting. In order to realize profit distribution anticipations throughout the year, the company must have the monthly balance sheets in place and the advance forecast must be registered in a social contract.
The value of the distribution of profits must be proportional to the composition of the company's capital stock. That is, if a member owns 10% of the company, he should receive 10% of the profit distribution.
About pro labore, there is the incidence of INSS. Regarding the dividends, from the distribution of profits, there is no incidence of charges or taxation.
The guideline for calculating a fair pro-labor is to ask:
If I were to look for a professional in the market to perform this function, how much would he earn?
The answer to this question is a good reference of how much it would be fair for a managing partner to receive. If the company already has employees, it is common that the workers are equal or higher than the highest salaries. Usually inspections investigate this to determine if there are disagreements in the payment of pro labore.