Brazil CLT vs PJ Calculator (2026)
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Brazil has two very different ways to pay a professional: CLT, the formal employment regime, and PJ, where the worker invoices through their own company. This calculator converts both into a comparable monthly figure — the full CLT package on one side, the real take-home of a Simples Nacional company on the other — and tells you what invoicing level makes the contractor offer equivalent.
CLT and PJ are not the same number
Under CLT, a gross salary is reduced by INSS social security (7.5% to 14%, capped at R$8,475.55 in 2026) and by withheld income tax of up to 27.5%. But the employee also receives a 13th salary, 30 days of paid vacation plus a one-third bonus, an FGTS severance deposit of 8% of all remuneration, and typically meal and health benefits. In cash terms, a CLT year is worth 13.33 salaries, not 12.
Under PJ, the professional invoices a gross amount through a company. From it come the DAS — the single monthly Simples Nacional tax — social security and income tax on the pró-labore (the owner’s salary), and accounting fees. Whatever is left can be distributed as profit, which is generally income-tax free. There is no 13th salary, no paid vacation, no FGTS and no unemployment insurance.
This calculator builds both sides and reports the difference, plus the break-even invoicing amount.
The fator R rule: 6% or 15.5%?
The single most important variable — and the one most comparisons get wrong — is the fator R. Service companies under Simples Nacional fall into Annex III, starting at a 6% effective rate, or Annex V, starting at 15.5%. The test is the ratio between the payroll of the last 12 months (including the owner’s pró-labore) and gross revenue over the same period. At 28% or above, Annex III applies; below it, Annex V.
For a one-person company the payroll is essentially the pró-labore, so the owner effectively chooses the annex. A contractor invoicing R$7,000 who pays themselves the legal minimum of R$1,621 has a fator R of 23.2% and pays 15.5% — R$1,085 per month. Raising the pró-labore to R$1,960 (28% of revenue) drops the tax to 6%, or R$420 per month, at a cost of roughly R$37 in extra social security. That is more than R$7,000 saved per year.
Above R$180,000 of revenue in 12 months, the effective rate follows the formula [(RBT12 × nominal rate) − deduction] ÷ RBT12. For R$18,000 invoiced monthly (RBT12 of R$216,000), Annex V gives (216,000 × 18% − 4,500) ÷ 216,000 = 15.92%, and Annex III gives 6.87%.
| 12-month revenue (RBT12) | Annex III nominal | Annex V nominal | Deduction III / V |
|---|---|---|---|
| Up to R$180,000 | 6.00% | 15.50% | — / — |
| R$180,000.01 – R$360,000 | 11.20% | 18.00% | R$9,360 / R$4,500 |
| R$360,000.01 – R$720,000 | 13.50% | 19.50% | R$17,640 / R$9,900 |
| R$720,000.01 – R$1,800,000 | 16.00% | 20.50% | R$35,640 / R$17,100 |
| R$1,800,000.01 – R$3,600,000 | 21.00% | 23.00% | R$125,640 / R$62,100 |
| R$3,600,000.01 – R$4,800,000 | 33.00% | 30.50% | R$648,000 / R$540,000 |
What a PJ offer has to be worth
A common rule of thumb in the Brazilian market is that a PJ offer should be 1.3 to 1.4 times the CLT salary. The numbers below, produced by this calculator for a professional with no dependents, R$800 of monthly benefits and R$300 of accounting fees, show that the multiplier is not constant — it is far higher for lower salaries, because progressive income tax eats more of a high CLT salary while Simples Nacional stays proportional.
This matters for companies hiring Brazilian talent as contractors. Offering 1.4× a mid-level local salary can genuinely leave the professional worse off than formal employment, while at senior levels the same multiplier is well above equivalence.
| CLT gross salary | Equivalent CLT package | PJ break-even (minimum pró-labore, Annex V) | PJ break-even (optimised fator R, Annex III) |
|---|---|---|---|
| R$5,000.00 | R$6,298.49 | R$8,019.88 (1.60×) | R$7,257.46 (1.45×) |
| R$8,000.00 | R$8,440.64 | R$10,554.97 (1.32×) | R$9,613.54 (1.20×) |
| R$10,000.00 | R$10,242.36 | R$12,687.18 (1.27×) | R$11,595.20 (1.16×) |
| R$15,000.00 | R$14,867.36 | R$18,256.91 (1.22×) | R$16,784.13 (1.12×) |
What the calculation deliberately leaves out
The comparison prices only what can be priced monthly. Several CLT protections have no simple market value and are excluded: unemployment insurance, the 40% FGTS penalty on dismissal without cause, job stability during sick leave and pregnancy, paid parental leave and indemnified notice periods.
Two contractor-side costs are also excluded. First, retirement: contributing 11% on a minimum-wage pró-labore builds a pension near the floor, and topping it up costs real money. Second, unpaid time off — a month not invoiced is roughly 8% of annual revenue. A realistic contractor should set aside part of each invoice to replicate the 13th salary, vacation and an emergency fund.
Finally, be aware of misclassification risk: a contractor relationship with personal, habitual, subordinated and paid work can be reclassified as employment by Brazilian labor courts, with retroactive liability for the hiring company.
Frequently asked questions
How much more should a PJ contractor be paid than a CLT employee in Brazil?
It depends on the salary level and on the fator R. This calculator puts the break-even multiplier at 1.60× for a R$5,000 salary with a minimum pró-labore, falling to 1.12× for a R$15,000 salary with an optimised fator R. The widely quoted 1.3–1.4× rule of thumb only holds for a narrow middle band.
What is the pró-labore and why does it matter so much?
The pró-labore is the salary a company owner pays themselves. Its legal minimum equals the national minimum wage (R$1,621 in 2026). It carries 11% social security and income tax withholding, but it also counts as payroll for the fator R test — which can move the company from a 15.5% tax rate to 6%.
Are profits distributed by a Simples Nacional company tax free?
Generally yes, under article 14 of Complementary Law 123/2006, provided the company keeps regular accounting records. Since 2026, Law 15,270/2025 withholds 10% on distributions above R$50,000 per month from the same company to the same individual; its application to Simples Nacional companies is legally contested. The calculator treats distributions as exempt, which fits the typical amounts involved here.
Can a foreign company hire a Brazilian professional as PJ?
Yes, and it is common — the professional invoices from their own Brazilian company. The tax modeled here still applies to them. Note that habitual, subordinated work can be reclassified as employment by Brazilian labor courts, so the contract terms and the way the work is managed matter.
Does the calculator work for MEI?
No. MEI is a separate micro-entrepreneur regime with a fixed monthly tax and an annual revenue cap far below the levels typically compared against a CLT salary. This calculator models a regular Simples Nacional service company subject to the fator R.
Sources
Comparative estimate based on Brazil’s 2026 INSS and income-tax tables (including Law 15,270/2025) and the 2026 Simples Nacional Annex III and V tables, checked on August 23, 2026. It assumes a single-owner service company with no employees, subject to the fator R, with RBT12 estimated as monthly revenue × 12 and distributed profits treated as exempt. The 13th-salary and vacation-bonus provisions are added at gross value. It does not price unemployment insurance, the 40% FGTS penalty, job stability, paid leave, indemnified notice, or voluntary top-up pension contributions, and it is not a substitute for advice from a Brazilian accountant.
Related calculators
Also available in Portuguese: Calculadora CLT ou PJ 2026