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May 5, 2022
Brazil allows taxpayers to settle certain debts from the tax regime preceding Law No. 12,973/2014
Taxpayers may enter into a settlement agreement for outstanding debts resulting from the amortization of goodwill under the tax regime preceding Law 12,973/2014. Before entering into a settlement agreement, taxpayers should consider the tax, accounting and financial implications.
The Brazilian Office of the General Counsel for the National Treasury (PGFN) published, on 3 May 2022, Public Notice 9/2022, which allows taxpayers to settle debts arising from the amortization of goodwill under the tax regime preceding Law No. 12,973/2014.
According to the Public Notice, taxpayers may settle debts (regardless of whether they are registered as overdue federal tax liabilities, including suspended liabilities) that are pending in administrative adjudication or judicial litigation as of 3 May 2022. The Public Notice also applies to cases involving the addition of goodwill amortization expenses to the calculation of the social contribution on net profit. The settlement agreement must cover all the debts that the taxpayer has outstanding as a result of the amortization of goodwill.
Taxpayers have until 29 July 2022, to enter into a settlement agreement. As part of the settlement, the taxpayers agree to have their cases withdrawn from administrative or judicial proceedings.
Under the settlement agreement, taxpayers may choose one of the three methods to pay off their tax liability:
When determining whether to enter into a tax settlement, taxpayers must take tax, accounting and financial aspects into consideration.
For additional information with respect to this Alert, please contact the following:
EY Assessoria Empresarial Ltda, São Paulo
Ernst & Young LLP (United States), Latin American Business Center, New York
Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific