Companies should take care of tax planning for 2018

As previously discussed in our publication "Important aspects in tax area in 2018" (here), this year will bring new issues for companies. Given this scenario, it will be necessary to monitor taxes and other obligations correctly, so that the company does not suffer an increase in the tax burden or do not take the of tax credits advantage to which it would be entitled, for example. In addition, hiring a Taxes Consultancy will be crucial for a smooth crossing through 2018.

How important is the tax planning?

Through this action, the company has the opportunity to assess its taxes payable, following a planning carried out within the legal requirements and avoiding future contingencies.

It is very important to act within the law and to be cautious when applying new practices, if these are necessary, to avoid that the taxes authorities understand as tax evasion (fraud).

An adequate tax planning may also bring greater profitability to the operation carried out by the company, without, of course, causing risks from an erroneous practice.

What are the best practices for adopting in my planning?

1) Review the tax regime adopted by your company

The right choice for tax regime (Real Profit, Assumed Profit or Simples Nacional) allows the company to collect taxes according to its size and/or activity practiced. For more information on choosing the tax regime, see our publication "Choosing the best tax regime for your business in 2018" here.

2) Use tax incentives or benefits

Many activities have development programs. Tax incentives and benefits may be found at the local, state, and federal levels. With them, the company collects less taxes, may have the possibility to differ them for a future moment or operation and, in certain situations, it contributes to the development of a socio-cultural activity or project.

3) Survey your company’s tax credits

The credits with the Tax Authorities may be recovered or used in payment of taxes due. Check with your accountant about how to use credits, paying attention to the recent changes on how the Brazilian Federal Revenue will recognize them in 2018 (find more information in our article "RFB changes rules for refunding, compensation and reimbursement requests" here).

4) Keep your register data up to date

Having the company’s corporate acts duly filed at the Commercial Registry or at the Registry of Legal Entities, in addition to have its information correctly recorded at the public agencies, avoid complications with inspection authorities.

Moreover, it is very important that the corporate purpose described in the articles of incorporations and bylaws are in line with the activities carried out by company and correctly represented by the activity codes at registers. The economic activity codes are directly related to the way the activity is taxed.

5) Avoid labor liabilities

Prepare a control or revision of the procedures practiced in relationship with employees, outsourced and self-employed workers who may be engaged in the company's activities in order to avoid labor problems. It is also important that the responsibilities between clients and suppliers are clear, contractually signed and distributed according to the law.

These relationships must be in line with the changes brought about by the Labor Reform and informed within the new eSocial and EFD-Reinf standards, so that the company is not required to pay more taxes than necessary, in addition to possible penalties.

In order to help our clients, we have already published about eSocial - "Adjustment to eSocial: steps for a secure transition", which may be accessed here; and, dealing with EFD-Reinf - "Prepare your company for the compulsory filing of EFD-Reinf from 2018", which can be read here.

6) Outsource Tax Reviews

Always is positive to periodically adopt an external review your company’s routine, no matter how correct are the internal procedures. With it, internal departments are free for the company's activities, which will have access to an objective survey of possible risks to which it is exposed and where taxation may be adjusted. From there, new procedures may be developed or adjusted for better practices and more organization. In some situations, a conduct change in company's business or even a corporate reorganization may be suggested.