Understand MEI And How To Do It

Those who work on their own can formalize their activity as MEI – Individual Microentrepreneur. This is an option that has been in place since 2009, so entrepreneurs have a simple and quick choice to have their small business legally.

Today, from A to Z, more than 400 activities are allowed. Next, understand how the MEI works and how to open the MEI quickly.

 

What is MEI?

The MEI – Individual Microentrepreneur is a way for self-employed to formalize and was created to reduce the informality of workers.

Who becomes MEI becomes legally recognized as a small business owner. The formalization gives access to labor benefits and beneficiaries, but it is necessary to pay taxes on time. These taxes are reduced compared to those charged in small businesses.

According to the Entrepreneur Portal, the small business owner must meet the following conditions:

  • Not being a partner, administrator or holder of another company;
  • Be 18 years old or be legally emancipated (aged between 16 and 18 years);
  • Billing a maximum of R $ 81,000.00 per year and R $ 6,750 per month (up to December 31 of the same year);
  • Exercise allowed occupation of MEI. You can register for a main occupation and up to 15 secondary ones;
  • Hire only one employee, if you want, and pay him at least one minimum wage or category floor.

 

How to open a MEI?

How to open a MEI?

 

In addition to the conditions described above, if you want to be formalized and have doubts as to whether or not you can become an MEI, know what is allowed or not allowed:

  • Retired people on disability can open MEI;
  • Retired public servant (except for invalidity) can open MEI;
  • Who is receiving sickness benefit, loses the benefit from the month of opening of the MEI;
  • Those who are receiving unemployment insurance can open MEI, but run the risk of losing the benefit. In case of suspension, contact the Ministry of Labor. Note: in case of dismissal without just cause, the MEI is not entitled to unemployment insurance;
  • Work registered in the CLT scheme: the small entrepreneur may have an employment relationship and exercise the occupation allowed to the MEI in the vacant hours;
  • Beneficiary LOAS (Organic Law of Social Assistance) and beneficiary of the Bolsa Família program can open MEI. When there is an increase in family income above the limit, LOAS or Bolsa Família beneficiaries may lose their benefits.

 

Can I open MEI with the “dirty name”?

Yes. According to the Entrepreneur Portal, anyone who has a cadastral restriction with credit protection institutions (DCC Credit, NNA Credit and uHappy Finance) can be formalized as MEI.

If that is your case, negotiating your debts with the lenders is the best solution. With finances up-to-date , you’re more likely to get credit to invest in your small business.

 

Who can not open MEI

  • Foreigner with provisional visa;
  • Public servant (while carrying out his activities);
  • Owner, partner or administrator of another company.

 

Advantages of becoming an MEI

Who can not open MEI

 

When it is formalized, the MEI – Individual Microentrepreneur now has the National Register of Legal Entities (CNPJ) and, as a result, is more likely to attract clients, since it can issue invoices and have a card machine.

Regarding the benefits of formalization, the MEI can count on:

  • Maternity pay. Minimum contribution time: 10 months (counting from the first payment due);
  • Sickness and retirement benefits due to disability. Minimum contribution time: 12 months (counting from the first payment on the day);
  • For dependents: death pension and confinement assistance (these benefits vary in duration according to age and type of beneficiary);
  • Retirement by age: 60 years for women and 65 years for men. Minimum contribution time: 180 months (15 years, counting from the first payment due).

 

How to be an MEI?

The application formalization is free and can be done over the internet. If you prefer, you can look for an accounting office to open the MEI.

To open an MEI, simply go to the Entrepreneur Portal and click on “Formalize” on the home page. First, have the following information available:

  • CPF;
  • Date of birth;
  • Number of voter’s title;
  • Number of the last delivery receipt of the Annual Personal Income Tax Return (DIRPF), if you are a declarant.

It is not necessary to send documents, copies or signatures.

In the Portal of the Entrepreneur, upon opening the MEI, a Certificate of Condition of Microentrepreneur – CCMEI is generated, containing the following data:

  • CNPJ;
  • Registration with the Board of Trade and INSS.
  • Provisional working permit.

 

What taxes should be paid by MEI?

micro finance loan

 

Despite the exemption from federal taxes, such as Corporate Income Tax (IRPJ), PIS and Cofins, after formalization, the MEI must make the monthly payment of R $ 47.70 referring to the INSS, plus R $ 5.00 (for Service Providers) or R $ 1.00 (for Trade and Industry).

The card is issued exclusively through the DAS (National Simples Collection Document), in the Entrepreneur Portal, that is, it is not sent by the Post Office. The amounts are updated annually, according to the minimum wage.

In case of default, the MEI loses the right to the benefit of retirement and may also not have access to sickness benefits, death pension or maternity wages.

When the DAS payment is not made on the due date, the document is generated with interest and late payment penalty.

 

Annual billing statement

The MEI Microentrepreneur is obliged to deliver the Annual Statement of Simple National Billing (DASN-SIMEI), which should be delivered by May 31, showing the previous year’s billing.

For example, by 31st of 2018, MEI will deliver the DASN-SIMEI for the 2017 invoicing. According to the Entrepreneur Portal, the delay in delivery can result in a fine, in the amount of R $ 50.00.

 

Cancellation due to delinquency

Cancellation due to delinquency

 

In case of default, the MEI loses the right to the benefit of retirement and may also not have access to sickness benefits, death pension or maternity wages.

When the DAS payment is not made on the due date, the document is generated with interest and late payment penalty.

The cancellation of MEI occurs when:

  • The annual income statement (DASN-SIMEI) has not been delivered in the last two years;
  • MEI is in default on all monthly contributions (DAS-MEI).

At the beginning of February 2018, the Internal Revenue Service reported that 1.37 million MEIs had their CNPJ canceled for default.

The cancellation of the MEI does not allow the small business owner to work in a legal manner, ie he returns to informality, and can not, for example, issue invoices to customers.

In order to open a new MEI, it is necessary to make late payments of the canceled MEI and to deliver the late annual declarations.

 

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