Most common business entity in Brazil
The Sociedade Limitada (Ltda) is the standard choice for most small- to mid-size businesses in Brazil. Like a US LLC, it provides limited liability protection separated from the owners' personal assets. Resident director typically needed; Simples available below BRL 4.8M revenue.
The full menu of Brazil business structures
| Structure | Liability | Tax | Best for |
|---|---|---|---|
| Sociedade Limitada (Ltda) | Limited | 34% corporate | Most operating businesses |
| Sole proprietor / self-employed | Unlimited personal | Personal income tax rates | Freelancers, one-person services |
| Partnership | Joint and several | Pass-through to partners | Professional services (law, accounting) |
| Branch of foreign company | Parent company liability | 34% on Brazil-source profits | Foreign companies entering Brazil market |
| Public limited company | Limited | Same as Sociedade Limitada (Ltda) but stricter | Companies preparing for listing |
Which one should you pick?
- Freelance or one-person service in Brazil? Self-employed structure if simple, Sociedade Limitada (Ltda) if you want liability protection.
- Software / e-commerce / agency? Sociedade Limitada (Ltda) — standard, scalable.
- Operating an existing foreign company in Brazil? Branch (simpler) or subsidiary Sociedade Limitada (Ltda) (more substance).
- Planning to raise venture capital? Confirm investors accept Brazil entities. Many require a US Delaware C-Corp flip — see US company formation.
- Holding company for IP or other companies? Sociedade Limitada (Ltda) with minimal substance requirements.
The Sociedade Limitada (Ltda) in one paragraph
Sociedade Limitada (Ltda) is Brazil's primary limited liability vehicle. Minimum paid-up capital: nominal. Headline corporate tax: 34%. IRPJ 15% + 10% surcharge + CSLL 9% = 34%. Simples Nacional from 6% for SMEs.. Banking accessibility: 7/10. Privacy: 4/10 (UBO public). Remote formation: in-person typical. Processing time: 30 business days.
For US comparison, see Brazil vs USA. For non-resident formation specifics, see forming a Brazil company as a non-resident.