Do self-employed people need to file income tax returns? What does the law say?

Knowing whether self-employed people need to declare income tax is very important for those who work on their own.

This is because there is a popular myth that says that self-employed people do not need to file a declaration, but is it true?

After all, what does the law say about this? Is MEI self-employed? How can I make the declaration more easily? 

All of these questions will be described throughout the content below.

That said, to answer this main question and many others, don't miss the content we have prepared for you! 

After all, what is self-employed?

Just come the time of IR statement to raise doubts about who should fill it out.

It is known that workers who have a formal employment contract and have taxable income must file a tax return.

The same goes for business owners, retirees and even owners of taxable assets.

But little is said about the self-employed, so many doubts arise about this "category".

However, before we answer whether or not this group should make the declaration, it is important to understand what a self-employed person is.

As the name suggests, self-employed is the name given to a professional who works on their own.

This means that the person is not registered to work for any company, and does not necessarily need to have an open company, therefore, they are not always classified as an entrepreneur.

In this category, it is very common to find service providers such as electricians, manicurists, independent designers, tattoo artists and many other professions.

As a result, the self-employed person usually earns their income by receiving payment for services performed.

Therefore, there is no defined control over the activity, which includes taxes.

But what about IR? Does the self-employed need to declare income tax on their monthly income?

We will see the answer soon! 

Is MEI self-employed or an entrepreneur? Self-employed person needs to declare income tax

When we talk about being self-employed, one of the first things to remember is the MEI.

In general, the association of subjects occurs because many have doubts as to whether the MEI is classified as self-employed or an entrepreneur.

And, we advance that the MEI fits into both categories.

This is because the MEI (Individual Microentrepreneur) program was created precisely to formalize some autonomous activities.

In this way, these activities become recognized, and an invoice can be issued and taxes paid for the services performed.

It is worth mentioning that with the opening of the MEI, a CNPJ is issued, so that the self-employed person starts to have an open company.

Therefore, for those who work independently, opening a MEI is an excellent way to professionalize the activity.

This is because the MEI has a legal obligation to make declarations, pay taxes and also has the opportunity to issue invoices to customers.

Below we will see whether the self-employed person needs to declare income tax, given that this is very similar to the MEI's activities.

Do self-employed people need to declare income tax? 

At this point you already understand what a self-employed professional is, and what their relationship is with the MEI.

With this, we can finally move on to the answer that defines whether self-employed workers need to declare income tax.

The first thing we must understand is that the income tax return is not restricted to some categories.

Therefore, it is not restricted to people who have formal employment records or who have proof of income.

This is because the declaration aims to regularize the situation of all citizens who have income and assets subject to income tax.

This is not restricted to salaries, much less to a company's income.

Therefore, the declaration must be made even by those who receive amounts without any professional ties.

Therefore, if you receive amounts in your account that are considered taxable, even informally, you will need to make a declaration.

The same goes for those who own taxable assets, such as cars, real estate and many others.

Therefore, if the self-employed person receives amounts considered taxable, or has taxable assets, he/she will have to make an annual declaration.

This declaration will serve to clarify the citizen's income, as well as regularize the tax payment situation.

Therefore, if you are self-employed, it is worth keeping an eye on the amounts considered taxable.

Furthermore, it is always worth checking whether you need to declare, based on your annual income.

Below we will see how this declaration should be made for informal self-employed workers and MEIs.

Informal freelancers 

When we talk about informal self-employed, we refer to professionals who work on their own and do not have an open company.

Therefore, monthly payments go directly into the account.

As we have already seen, this situation does not exempt the citizen from filing an IR declaration.

This is because self-employed people need to declare income tax if they have taxable income and assets.

In this case, you will have to make your declaration in person, through your Gov.br account, using your CPF.

When accessing the Federal Revenue Service's tax declaration platform, simply send all the evidence and provide information about your income.

This way, you will be able to update your declaration and also see if you have any taxes to pay.

It is worth mentioning that informal self-employed professionals must make the declaration as an ordinary citizen, using their CPF as identification.

MEI self-employed 

The second case is for self-employed MEIs, who work on their own, but have their activity formalized by opening a company.

The fact that the self-employed person is an MEI does not change much in the IR declaration, since this is done by CPF.

In this case, what changes is that the MEI includes the company's annual revenue in its declaration.

Furthermore, everything follows the same rules, as the amounts of taxable income and assets are the same.

So, it is clear that whether the self-employed MEI or not, he/she will only need to make the declaration if he/she meets the requirement criteria.

Finally, now that you understand whether self-employed people need to declare income tax, it is easier to regularize your situation with the Federal Revenue Service.

So, check if you meet the income criteria, and don't miss the dates to avoid many!