By Alessandro Barreto
The coronavirus pandemic has been severely impacting the routine of companies and, as a way of mitigating the effects of Covid-19 on business, public authorities have been postponing the deadline for submitting a series of deliveries.
Digital Bookkeeping (ECD) is another accessory obligation to have the term extended. The declaration for the 2019 calendar year can be submitted, exceptionally, until the last working day of July 2020.
At least for now, the Tax Accounting Bookkeeping (ECF), which is seen as a complementary statement to the ECD, remains with the delivery deadline unchanged.
In any case, it is worth mentioning that the fulfillment and review of these obligations must always be carried out with due attention, in order to minimize the risk of incurring high fines for incorrect, omission or non-delivery.
It is filled annually on the last business day of May.
With the postponement, this year, the declaration must be delivered by July 31st.
It is flled annually on the last business day of July.
Deadline: July 31.
The ECD extension was documented by IN RFB No. 1950, of May 12, 2020.
The measure is timely, given that many reporting companies are still adjusting to remote work and have expressed difficulties for this transmission, which requires caution when relating data and sending by digital certification.
After the extension of ECD, there is an expectation of an extension of ECF term as well. In this case, it is necessary to monitor the publication of standards to verify whether the measure will be confirmed.
The statements are complementary. While ECD consolidates detailed information from several accounting deeds of the legal entity, ECF presents all information related to the composition and due amount of Social Contribution on Net Income (CSLL) and Corporate Income Tax (IRPJ).
The table below shows what should be included in each obligation:
Proof and validation of the following business books:
- Daily Book and its assistants, if any;
- Ledger and its auxiliaries, if any;
- Book Daily Balance Sheets, Balance Sheets and Entry Sheets for auxiliaries.
Important: all events that occurred after January 1, 2019 must be included in this year's ECD.
All transactions that influence the composition of IRPJ and CSLL calculation basis.
Digital bookkeeping of the Real Profit Calculation Book (Lalur) is mandatory.
Important: In this case, there is no longer a need to complete IPI calculation form.
Although exempt and immune, legal entities are required, under the terms of Normative Instruction RFB 1.252 / 2012:
- They are subject to IR taxation based on real profit;
- That were taxed based on the presumed profit without incurring the IRRF, with a portion, of the profits or dividends, higher than the value of the tax calculation base, less the taxes and contributions to which it is subject.
Important: ECD is optional for companies opting for Simples Nacional as well as for other companies not included in this list.
Legal entities, including those equivalents, immune and exempt, through taxation on taxable income, presumed or arbitrated, as the case may be.
- Companies opting for Simples Nacional;
- Public bodies, autarchies and public foundations;
- Immune and exempt not entrusted with the delivery of EFD Contributions.
It is no longer news that the tax authorities have been improving the cross-checking of information between different obligations. The digital presentation of ECF and ECD also enables this type of cross-analysis, which raises any errors and inconsistencies in the data provided.
As ECD is composed of data that will be taken as a basis for filling in ECF, it is essential that these deeds have the information well aligned.
The crossings are still made with information provided by the companies to other modules of the SPED project, which also makes it essential that the accounting and tax areas go hand in hand to present the Tax Authorities with correct and always consistent data.
Talking about the crossings carried out by the Tax Authorities helps to demonstrate the importance and benefits of revising ECD and ECF.
While the preventive review ensures the correct filling of the records of the file, avoiding omission, inaccuracy and divergence of data to be sent. Anticipating eventual problems is valid, since the rectification ends up being laborious.
A review of previous calendar years is also a resource that can be adopted to verify compliance and any problem corrections that could be investigated by the inspection agent later on.
The review of ECD should check the registration information and accounting entries for the reference calendar year, in addition to the inclusion of the Management letter, financial statements and explanatory notes.
ECF is the old corporate income tax return and preserves the complexity of this type of delivery. In this case, the volume of information to be checked is greater and requires an even more technical and elaborated conference. In the review process, it is necessary to understand how each result was achieved: calculation of IRPJ and CSLL, transfer price adopted, if there is tax credit, among other points.
If inconsistencies are observed in ECF verification working papers, and ECD has already been delivered, it will be necessary to rectify the latter. Hence the need for an aligned, preventive action and a specialized look at the elaboration of these deeds.
It is also valid to check if the information present in the ECF is consistent with the other ancillary obligations already delivered: DCTF, DIRF and EFD Contributions.
There is another point to consider: as in ECF tax credit information from IRPJ and CSLL is inserted, the loading of incorrect information related to this tax and contribution in the bookkeeping can prejudice requests for compensation or refund through the PER / DCOMP Web system. When detailing the information about the origin of the credit, the inconsistency may invalidate the administrative process with the IRS.
In general, the revision of ECD and ECF has the following benefits:
• Guarantee of data integrity of each statement;
• Consistency between ECD and ECF records;
• Gains in financial and tax compliance;
• Mitigation of the risk of inspections and assessments.
This verification has as a final product an orientation report with points for improvement. From there, companies have in their hands important information on good practices to be adopted in accounting for records.
Adjustments must be made in the declaration transmission program itself through a rectifying presentation.
Domingues e Pinho Contadores has an advisory and operational team ready to assist companies in completing and delivering ECD and ECF annually, carrying out the due review and prior crossing of information, providing security and peace of mind in fulfilling obligations.
In the case of companies in which the DPC does not perform routine accounting and tax services, it is possible to act by reviewing deliveries due or already made, advising companies on the need for adjustments and rectifications and transmitting these corrective statements when necessary. This service guarantees compliance with the Tax Authorities, eliminating the risk of assessments for failures and differences.
Domingues e Pinho Contadores has specialized team ready to assist your company.
Contact us by the e-mail email@example.com
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