Tax & Compliance
Brazilian severance fund where the employer deposits 8% of CLT salary monthly.
FGTS (Fundo de Garantia do Tempo de Serviço) is the Brazilian severance fund into which the employer deposits 8% of a CLT employee's salary in a Caixa account. Properly documented mileage reimbursement is not salary and triggers no FGTS. Disguised payments (no receipt, no real trip) can be reclassified as wages by the Labor Court, generating retroactive FGTS plus penalty.