Venezuela

Employer of Record (EOR) in Venezuela

Only 399 EUR per employee per month

Rivermate's Employer of Record (EOR) solution helps companies hire remote employees in Venezuela . We take care of global payroll, taxes, benefits, compliance and HR activities. So you can focus on growing your business. Our Employer of Record (EOR) solution is beneficial to companies that want to hire remote employees in a breeze. On this page you will find employment information for Venezuela.

Employer of Record people
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Currency
Venezuelan Bolivar Fuerte
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Capital
Caracas
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Region
Americas
Megaphone
Language
Spanish
Hire remote employees
Population
28435940
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GDP
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GDP growth
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Ease of doing business
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World GDP share

1. Grow your team in Venezuela with Rivermate as your Employer of Record (EOR) / PEO

Payroll, benefits, taxes, and compliance can be difficult to manage in Venezuela , particularly if you don't have established local relationships. You can hire employees in Venezuela effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global Employer of Record (EOR) solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

2. Summary

Venezuela, formally the Bolivarian Republic of Venezuela (Spanish: Repblica Bolivariana de Venezuela), is a South American nation with a continental mainland and several Caribbean islands and islets. It has a land area of 916,445 km2 (353,841 sq mi) and a population of 28 million people in 2019. Caracas is the capital and biggest urban agglomeration.

The Caribbean Sea and the Atlantic Ocean border the country on the north, Colombia on the west, Brazil on the south, Trinidad and Tobago on the north-east, and Guyana on the east. Venezuela has a claim against Guyana for Guayana Esequiba. Venezuela is a federal presidential republic made up of 23 states, the Capital District, and federal dependencies that include the country's outlying islands. Venezuela is one of the most urbanized nations in Latin America, with the great majority of Venezuelans residing in northern and capital cities.

The land of Venezuela was conquered by Spain in 1522, despite indigenous peoples' resistance. It was one among the first Spanish-American areas to proclaim independence from the Spanish and became a department of Colombia's first federal republic in 1811. (historiographically known as Gran Colombia). It became a fully independent nation in 1830. Venezuela experienced political turbulence and despotism throughout the nineteenth century, and was governed by regional military dictators until the mid-twentieth century. Since 1958, the nation has enjoyed a succession of democratic administrations, with the exception of the majority of the area being controlled by military dictatorships, and the time has been marked by economic prosperity. Economic shocks in the 1980s and 1990s triggered significant political crises and widespread social unrest, including the fatal Caracazo riots in 1989, two failed coups in 1992, and the impeachment of a President on allegations of misuse of public money in 1993. The 1998 Venezuelan presidential election served as the trigger for the Bolivarian Revolution, which started with a 1999 Constituent Assembly in which a new Venezuelan Constitution was enforced. Soaring oil prices aided the government's populist social welfare measures, temporarily raising social expenditure and lowering economic inequality and poverty in the early years of the dictatorship. Poverty, on the other hand, started to rise in the 2010s. The 2013 Venezuelan presidential election was extensively contested, resulting in major protests and a new statewide crisis that continues to this day.

Venezuela is a developing nation with a Human Development Index ranking of 113th. It contains the world's biggest known oil reserves and has historically been one of the world's main oil exporters. Previously, the nation was a developing exporter of agricultural commodities such as coffee and cocoa, but oil swiftly overtook exports and government earnings. The incumbent government's excesses and bad policies led to the collapse of Venezuela's entire economy. The nation is dealing with record hyperinflation, food shortages, unemployment, poverty, sickness, high child mortality, malnutrition, terrible crime, and corruption. These reasons have contributed to the Venezuelan migration crisis, in which over three million people have left the nation. Credit rating firms declared Venezuela to be in default on debt payments by 2017. Venezuela's crisis has exacerbated a fast worsening human rights situation, including intensified violations such as torture, arbitrary detention, extrajudicial murders, and assaults on human rights activists. Venezuela is a founding member of the United Nations (UN), the Organization of American States (OAS), the Union of South American Nations (UNASUR), ALBA, Mercosur, the Latin American Integration Association (LAIA), and the Organization of Ibero-American States (OEI).

Hiring talented employees in a short span is not an easy task. Partnering with an Employer of Record (EOR) like Rivermate in Venezuela is your best option, giving your organization enough time to focus on other aspects of international expansions like project management and inventory management. The EOR takes care of all the compliance and legal issues while helping you speed up hiring using their knowledge of domestic employment practices and virtual onboarding tools. Top EORs also have provisions for the e-signing of documents to enable faster onboarding.

3. Public holidays

4. Types of leave

There is no information about the types of leave for this country.

Paid time off

Employees in Venezuela are entitled to 15 working days of paid vacation after one year of continuous employment, plus one extra working day for each successive year of service, up to a maximum of 30 working days per year.

Public holidays

The Bolivarian Republic of Venezuela recognizes 14 national public holidays.

Sick days

Employees are entitled to three days of paid sick leave, and from the fourth day onwards, they will get 66.7 percent of their wage from social security for up to 52 weeks.

Maternity leave

For the birth of a child, female employees are entitled to 26 weeks of maternity leave. Maternity leave can be taken up to six weeks before the baby is born, with the remainder taken after the baby is delivered.

Paternity leave

After the birth of a child, fathers can take up to 14 days off work. This leave can be extended if the mother becomes unwell or dies, if the kid becomes unwell, or if twins or multiples are born.

Parental leave

Apart from the already mentioned terms regarding maternity and paternity leave, there are no other provisions in the law of Venezuela regarding parental leave.

Other leave

5. Employment termination

There is no information about employment information for this country.

Termination process

Employees in Venezuela have a right to employment security. Dismissals of employees must be referred to the proper labor court for determination of the termination's legality. Without cause dismissal needed between one week and one month's notice, depending on the employee's length of service. Additionally, special requirements apply to redundancy dismissals.

Notice period

In Venezuela, there is no statutory notice period; this is typically agreed upon in the employment contract.

Probation period

Probationary periods are not specified in Venezuelan labor laws. However, an employee may be terminated without cause during the first 30 days of employment.

Severance pay

Employees are entitled to a "seniority benefit" equal to 30 days' pay for each year worked.

6. Working hours

There is no information about the working hours for this country.

General working schedule

A typical workweek is 40 hours, or eight hours per day. Workers are required to take two consecutive days off per week, and Sunday is a rest day for the majority of businesses. Night shifts should not exceed seven hours in duration, and workdays should not exceed eleven hours in duration, day or night.

Overtime

With permission, overtime is permitted but cannot exceed two hours per day, ten hours per week, or one hundred hours per year. Employees are entitled to overtime pay if they work more than 40 hours per week.

7. Minimum wage

There is no information about the minimum wage for this country.

The minimum wage in Venezuela is set at 10 million bolivars per month.

8. Employee benefits

There is no information about the employee benefits for this country.

The government mandates health and safety regulations in the workplace to avoid sickness and harm. Employers are not required by law to offer health insurance in the case of public health care. Nonetheless, the Venezuelan public health care system needs resources, particularly equipment and personnel training. Employers may choose to include private insurance choices among their workers' perks.

Employees get vacation incentives in addition to regular pay for vacation days. The company gives employees 15 days of salary for the first year and an extra day for each year of service after that. Employees may get up to 30 days of pay as an annual bonus.

A necessary benefit is described in the Workers' Food Law. Employers must offer one balanced lunch to their workers every day under this jurisdiction. This practice may include an in-house chef or an amount of money for purchasing lunch.

9. Taxes

There is no information about the taxes for this country.

Corporate tax

Firms based in Venezuela pay corporate income tax (CIT) on both Venezuelan and foreign-source revenue, while corporations based elsewhere with a permanent presence (PE) in Venezuela pay CIT solely on the Venezuelan and foreign-source income due to the PE. Corporations may claim as a tax credit any comparable taxes paid overseas on foreign-source revenue. Non-resident companies that do not have a PE are solely liable to CIT on Venezuela-sourced revenue.

Corporate income is taxed at the progressive rates depending on tax units as follows:

For a tax unit count of up to 2,000 tax units, the tax rate is 15 percent.

For a tax unit count between 2,000 tax units and 3,000 tax units, the tax rate is 22 percent.

For a tax unit count over 3,000 tax units, the tax rate is 34 percent.

The idea of a taxable unit was introduced in the 1994 Income Tax Law revision as an element that minimizes the negative impacts of inflation on the calculation of tax rates. The tax law set the starting TU at VEF 1, with yearly increases based on changes in the Consumer Price Index (CPI) from the preceding year. This adjustment parameter has been repealed in the new Master Tax Code. The TU value for 2020 was VES 1,500. The TU stated figure for 2021 is VES 20,000.

Individual income tax

Individuals who are residents are taxed on their global income. Foreign residents having a fixed basis in Venezuela must pay taxes on their income, whether from a domestic or foreign source, that is traceable to that base. Non-residents must pay taxes on their earnings when the source or origin of the earnings is in Venezuela.

Individuals who are residents are taxed at graded rates. The following tax rate table is used to compute the yearly income tax, before credits:

0 to 1,000 tax units: 6 percent.

1,000 to 1,500 tax units: 9 percent.

1,500 to 2,000 tax units: 12 percent.

2,000 to 2,500 tax units: 16 percent.

2,500 to 3,000 tax units: 20 percent.

3,000 to 4,000 tax units: 24 percent.

4,000 to 6,000 tax units: 29 percent.

Over 6,000 tax units: 34 percent.

Non-resident persons' income from non-business professional activity is taxed at a rate of 34% on 90% of gross payments. Non-residents' salaries and other income earned in Venezuela are subject to a flat 34 percent withholding tax, which is deducted at the source.

VAT, GST and sales tax

Federal VAT (Impuesto al Valor Agregado, or IVA) is a one-time tax paid by the final consumer of all goods and services. However, each business entity involved in the process, from the sale of raw materials to the production and distribution of finished products to the final consumer, is required to include the tax on its products to customers (output tax) and to pay the tax on its purchases or imports of goods and services (input tax), with the amounts paid credited against the amounts due on its own activities. The net amount payable by each business is regarded as a tax on value added.

In general, VAT does not represent an additional cost to business enterprises because even though all types of business enterprises, including government departments and agencies (with some exceptions), are required to accept charges of the tax by suppliers on their purchases of goods and services, such amounts are normally deductible from the liability of the business enterprises for the tax on their bills to customers.

There are certain exceptions, most notably where a business's sales are VAT free, in which case the enterprise is regarded as the ultimate consumer and must absorb all VAT costs on its purchases except when its operations are subject to the zero rate. Input tax paid on products or services used to create VAT-exempt items, on the other hand, may be deducted for CIT purposes.

10. VISA and work permits

There is no information about VISA and work permits for this country.

Employers of foreign nationals in Venezuela have various alternatives under the country's immigration system. The requirements, processing dates, work eligibility, and perks for accompanying family members differ depending on the kind of permission.

Before entering Venezuela, all foreign citizens must get a business visa – TR-N Visa – which is normally valid for one year and enables stays of up to 180 days, continuous or cumulative, during the term of the visa.

Short-term employees on home payroll utilize the 90-Day TR-L Visa, which allows them to work for 90 days.

The TR-L Visa is the most common kind of work authorization, valid for one year with infinite renewals. While there is no necessity for labor market testing, there is a minimum pay requirement that varies yearly. A TR-L Visa application needs the Ministry of Labour to first approve a Work Permit. All foreign individuals, regardless of nationality, must get a TR-L visa from a Venezuelan consular office following SAIME (Servicio Administrativo de Identificación, Migración y Extranjera) clearance. After five years of continuous residence in Venezuela, holders with TR-L visas are eligible for permanent residency.

11. Employer Of Record service terms

There is no information about the Employer of Record (EoR) service terms for this country.

Employment contracts

Employment contracts may be verbal or written, with a set or indeterminate period. It is best if all contracts are in writing. The following specifications will be included in a signed contract:

Identification of the participants

The start date of the employee's employment.

Position Description and Timeline (if for a fixed-term)

Working hours and specifics

The employee's base pay and any other allowances

Workplace

Any other employment terms or conditions

In Venezuela, there is no formal probation term. However, an employer may fire an employee without cause within the first 30 days of employment, which is typically regarded as the appropriate probationary term.

With Rivermate being your Employer of Record (EoR) in Venezuela, you do not have to worry about the employment contracts, as we take care of that.

Minimum assignment length

There is no set length for assignments. This is usually indicated in the employment contract for fixed-term employments.

Payment currency

Venezuelan Bolivar Fuerte

13.Opening a subsidiary in Venezuela

There is no information about the working hours for this country.

How to set up a subsidiary

Before you begin the subsidiary procedure, you should analyze the various business kinds and which one is appropriate for you. There are two sorts of businesses in Venezuela: limited liability and public limited.

In the region, a limited liability corporation is not as frequent. It requires a minimum share capital of between USD 4 and USD 400, as well as at least one director and shareholder. A director and a shareholder are still required for public limited businesses, but no share capital is required.

Once you've decided on the sort of business you want, you must go through the legal formation procedure. You are required to:

1. Approve the name of your firm with the Company Registrar.

2. Publicize your articles of incorporation in a local newspaper.

3. Keep track of company books.

4. Obtain a tax ID from the National Integrated Service for Customs, Duties, and Taxes.

Subsidiary laws

Regardless of the kind of business, you must designate at least one director and shareholder when establishing your subsidiary. Because your director does not have to be a citizen of the nation, you might pick one of your parent company's present workers.

Your articles of association are also required for registration. This document describes how your company will be operated, such as how you will pick directors and how you will handle financial records.

The Code of Commerce in Venezuela mandates all enterprises to register their financial records and books with the Company Registrar. You must also provide any relevant audit and public accountant reports. Before submitting these papers, they should be in Spanish and approved by your shareholders.

13. Why choose Rivermate as your Employer of Record / PEO in Venezuela

Establishing an entity in Venezuela to hire a team takes time, money, and effort. The labor law in Venezuela has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into Venezuela simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record (EOR) solutions in Venezuela give you peace of mind so you can focus on running your business. Please contact us if you'd like to learn more about how Rivermate can help you hire employees in Venezuela via our Employer of Record (EOR) / PEO solution.

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