REINF is a new component under Brazil’s SPED e-accounting mandate that requires digital bookkeeping and monthly reporting of withholdings and information on Social Security contributions. REINF complements eSocial, and will largely affect service-oriented companies like agribusiness, civil construction, cleaning services, maintenance, security, telemarketing, hotel and services, promotional sales and sporting events. Under REINF, companies will be required to report all taxpayer withholdings as well as information on gross revenue to substantiate social security contributions.
REINF integrates several ancillary obligations, such as the EFD-Contributions module, which calculates the Social Security Contribution on Gross Revenue (CPRB) and reports on deductions from the taxpayer that are not related to work (PIS, Cofins, Income Tax, CSLL, INSS), as well as:
- Withholding Income Tax Return (DIRF)
- Statement of Federal Tax Credits (DCTF)
- FGTS Company Collection System
- Information Social Security (SEFIP)
- Guide to Collection of the FGTS
- Information to Social Security (Gfip)
Companies with revenues greater than R$78M (~USD$24M) are required to implement REINF by January 1, 2018. The deadline for all other companies operating in Brazil is July 1, 2018.
REINF presents major changes when businesses must report Social Security withholdings, accelerating from yearly reporting to monthly reports due by the 20th day of the following month. Special event producers have an even more aggressive compliance timeline. They are required to produce filings within two business days of an event.
REINF, along with eSocial, carries a heavier penalty than many other SPED components, in that its transmission is responsible for the generation of tax credits. REINF requires real-time validations from the tax authority, and if a filing is neglected or an error is made, tax refunds and credits will be delayed or missed, disrupting cash flow.
REINF also presents several implementation challenges, particularly surrounding data extraction and the ability to generate and submit the required information to the tax authority. Other SPED reports require .txt files; the move to XML will require new processes and web services connectivity.
With REINF deadlines fast approaching, do not wait to implement your REINF compliance solution. Learn more about REINF by watching our recent webinar, Lessons Learned from Complemento de Pagos & CFDI 3.3.