THE IMPORTANCE OF TAX SIMULATION TO DEFINE THE PROPER FRAMEWORK DURING COMPANY INCORPORATION

Abstract

This study discusses how important it is to carry out the tax analysis to define which means of taxation is the most appropriate means of taxation during the constitution of the company, in order to reduce high tax burdens. The methodology used was through bibliographic survey, preparation of spreadsheets of calculations, set of information of a company with fictitious data for the demonstration of how each regime acts, where the method used was qualitative. Further more, adjustments were made between tax regimes with emphasis on federal taxes (Corporate Income Tax and Social Contribution on Profit), in order to demonstrate which form of taxation would be the most advantageous. Such analyses demonstrated that the most beneficial tax regime with lower tax burdens would be the Annual Real Profit.