The filing period for the Accounting-Tax Bookkeeping (ECF), for 2017 calendar year, is coming up (July 31, 2018), and companies need to be aware of the instructions in the Guidance Book available in Cofis Declaratory Act 84/2017, which deals with the special situations of 2018.
Attentions to the innovations brought by the most current versions of the ECF guidance book and keeping up to date the Validator and Subscription Program (PVA), which exchange data to SPED (Public Digital Bookkeeping System), are essential attitudes for work with no pending.
Over the past few months, updates to correct system errors and changes in filing information rules have been made. Recently, ECF Version 4.04 introduced the Block “V”- “Declaração Derex” (Declaração sobre a Utilização dos Recursos em Moeda Estrangeira Decorrentes do Recebimento de Exportações - “Derex”, Statement on the Use of Foreign Currency Resources Due to Export Receipts, in a free English translation), as a novelty, to report investments and the exporter's own obligations payments, with funds held in a financial institution overseas and specifying the amounts destined to the acquisition of goods and services, including interest and the remuneration of rights, in the case of payments of obligations abroad.
The Guidance Book indicates that the turnovers should be accumulated month by month, by country, currency, and financial institution. The data concerning the financial institution should include the identification of the bank accounts and its respective attorneys, representatives or agents abroad, the account signatories.
Note that companies should keep at Treasury disposal all appropriate documentation to prove the carried out operations recorded at the ECF.
Important: the data on foreign exchange contracts are informed in Block "V", and it is possible to check, from the settlement of the accounts, if the records comply with the limits and deadlines established by the National Monetary Council (CMN).
The Tax-Accounting Bookkeeping (ECF), besides being a new way to file data on Corporate Income Tax and Social Contribution determination, allows the tax authorities cross-check the accounting and tax audits connected information and electronic audits, increasing its inspection power.
It is important to always consider that ECF collects various data, and, therefore, in addition to complying with deadlines to the file and correct filling, companies should be careful to the crosschecking of information recorded in other accessory obligations to eliminate the risk of inconsistencies in transmitted data.
In addition, the delivery of ECF after the deadline and/or sending with errors or omissions leave the companies exposed to penalties, according to the tax regime:
The basis for penalties is provided for in Article 57 of the Provisional Measure 2158-35, of 2001 (with wording given by Law 12873, of 2013). Taxpayers whom determine the IRPJ, for any system other than real profit, do not file ECF, subject the violator to the following penalties:
a) BRL 500.00, per calendar month or fraction, applicable to legal entities in the beginning of activity or that are immune or exempt or that, in the last presented statement, have determined presumed profit or Simples Nacional;
b) BRL 1,500.00, per calendar month or fraction, applicable to other legal entities.
The profit calculation form is stated in the DCTF filed at the beginning of each calendar year. Legal entities that have used in the last ECF more than one calculation form or have performed a corporate reorganization event are subject to a penalty amounting to BRL 1,500.00 per calendar month or fraction.
The ECF penalty to taxpayers not taxed by the real profit will be reduced by 50% when the accessory obligation is fulfilled before any ex officio procedure.
If the ECF is filed with inaccurate, incomplete, or omitted information, a penalty equivalent to 3%, not less than BRL 100.00, will be applied to the commercial transactions or financial operations value subject to corrections.
The penalty will also be limited to:
a) BRL 100,000.00, for legal entities that have received total gross revenue, equal to or less than BRL 3,600,000.00 in the previous calendar year;
b) BRL 5,000,000.00 for legal entities that are not in the above hypothesis.
When the legal entity does not record net income before IRPJ and CSLL during the determination period the bookkeeping refers to, it must use net income before IRPJ and CSLL for the last reporting period, updated by the SELIC reference rate, by the end of the period to which the bookkeeping refers.
It is expected that the ECF of legal entity taxed by the real profit will have the penalty reduced in:
a) 90%, when filed within 30 days after the deadline;
b) 75%, when filed within 60 days after the deadline;
c) 50%, when filed after the deadline, but before any ex officio procedure; and
d) 25%, if filed within the period set forth in subpoena.
In addition, the penalty of 3%, not less than BRL 100.00, of the value omitted, inaccurate or incorrect will be applied to the legal entity taxed by the real profit that presents the ECF with inaccuracies or omissions. The fine will not be due if the taxable person corrects the inaccuracies, inaccuracies or omissions before any legal procedure starts.
The penalty will be reduced by 50% if the inaccuracies, incorrections or omissions were corrected within the deadline set in the subpoena.
See also:ECF - General issues
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