Did you know that, in Portugal, the members of statutory bodies of companies - MSB, who carry out unremunerated duties - automatically fall under the general scheme of employees?
Therefore, both the company and the MSB have a contributory obligation, in exchange for the right to protection for the MSB, in the event of unemployment.
Does this theme draw your attention?! Then analyse Lúcio’s case, managing partner of the company "Candeeiros, Lda." and check, in detail, the existent monthly obligations.
The company of Lúcio delivered, after its establishment, to the Social Security, the social pact of the company. In this document, it is stated that the managing partner is not remunerated for his managing duties.
Regardless of whether Lúcio obtains a remuneration or not, as long as he is the company manager he will be subject to Social Security contributions.
If no income is obtained, the monthly obligations must comply with the following guidelines:
- The company will be charged a fee of 23.75% of the value of the SSI (Social Support Index), that is, "Candeeiros, Lda." will have to pay a monthy contribution of €103,50;
- The manager will be charged a fee of 11% of the value of the SSI, that is, Lúcio will have to pay a monthly contribution of €47,90.
In total, due to the functions of Lúcio and similar to what happens with other employees, the company will have to deliver monthly to the Social Security a rate of 34.75% on the reserve base that, in case there is no remuneration, will correspond to the value of the SSI.
This means that each year the company will have a cost of €1.242,00 for the Social Security of its unremunerated manager. As a result, the value of the contribution paid by "Candeeiros, Lda." to Social Security (23.75%) corresponds to a charge on remuneration, which will therefore be accepted as cost.
Lúcio, despite of delivering a compulsory Social Security contribution of €574,80/year, for his position as manager in the company, will not have income from category A in his tax return, since he did not actually receive remuneration.
Having said this, Lúcio wondered about the differences between obtaining or not obtaining a minimum remuneration, as manager. Let's see:
If the company "Candeeiros, Lda." pays its manager the minimum wage value, in 2019:
- The company will be charged a rate of 23.75% on the amount due, that is, "Candeeiros, Lda." will have to pay a monthly contribution of €142,50;
- The manager will be charged a fee of 11% on the amount of his salary, that is, Lúcio will have to pay a monthly contribution of €66,00.
- Lúcio's income, at its minimum, will not be subject to IRS.
In comparison with the previous situation, so that Lúcio obtains a minimum income, for his manager duties:
- The company will have to deliver to the Social Security the annual contributions due in an amount higher than €753,00 per year;
- Lúcio will have to deliver to the Social Security its annual contribution in an amount higher than €349,20;
Note that, with a total increase in annual contributions of €1.102,20, Lúcio, managing partner of the company, will be able to obtain €8.400,00 per year for his managing duties. That is, while in the "without remuneration" scenario (contributions calculated from the SSI) Lúcio does not receive any income, in the second scenario (with remuneration) it is possible for Lúcio to receive a monthly income from his company, in the form of salary of manager.
Do you have a situation similar to the one of Lúcio and do you still have doubts about your obligations? Well then, do not hesitate to contact us!