What is EFD-REINF?
A complement to eSocial (which covers tax withholdings on wages), EFD-REINF reports withholdings made to individuals and corporations resulting from the application of the income tax and social security taxes (CSLL, INSS COFINS, PIS/PASEP). It also applies to payments received by sport associations and revenues generated by sport events.
EFD-REINF replaces reporting obligations that the Brazilian taxpayers have to comply with under the EFD-Contribucoes.
Who must comply?
- Legal entities:
- That provide and contract outsourcing services in accordance with art. 31 of Law No. 8,212 of July 24, 1991
- Who are responsible for withholding the social security taxes PIS/Pasep, the Cofins and the CSLL
- Opting for payment of social security contribution on gross revenue (CPRB)
- Entities considered rural producers and agro-industries when subject to substitutive social security contribution on the gross revenue from the commercialization of rural production
- Sports associations that have professional soccer teams receiving revenues related to sponsorship, licensing of use of brands and symbols, marketing, advertising and broadcasting of sports shows
- Sponsors that provide resources to those sports association
- Entities marketing any sport event held in Brazil, involving at least one sport association that owns a professional soccer team
- Entities and individuals that have paid or credited income on which the federal income tax has been withheld by themselves or as representatives of third parties
How is the EFD-REINF structured?
There are three groups of reports, or “events,” that must be submitted to the tax administration:
- Table Events (Eventos de Tabela): Intended to optimize and validate the information that identifies the taxpayer and some administrative and legal processes that may affect them (if they exist).
- Non-Periodic Events (Eventos Não Periódicos): Information related to transactions that do not occur on a regular basis and therefore should only be reported when they occur.
- Periodic Reports (Eventos Periodicos): Events related to periodic information that should be reported on a regular basis by the taxpayer. These include:
- Withholdings for Social Security tax for services received
- Withholdings for Social Security tax for services provided
- Revenues received by sport associations
- Revenues Transferred by sport associations
- Social Security tax on gross receipts
- Withholding taxes (IR, CSLL, Cofins, PIS/PASEP)
When does it go into effect?
The EFD- REINF is being rolled out in three stages.
- May 1, 2018: Companies with revenues greater than 78 million Real annually
- November 1: Companies with revenue less than 78 million Real
- May 1, 2019: All public entities
What are the penalties for non-compliance?
Events that are incomplete, or reported with errors, will a face fines totaling 3% of the amount involved, with a minimum of $100 Real in the case of legal entities, and half of the above amounts when the taxpayer is an individual. Fines for late reports will range between from $500 Real to $1,500 Real per month or fraction of month.
To learn more about other changes impacting companies operating in Brazil and throughout Latin America, download the Definitive Guide to Error-Free Compliance in Latin America.