Brazil Launches EFD-REINF for Tax Withholdings

Ramón Frias
July 9, 2018

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.

Take Action

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.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.

Author

Ramón Frias

Ramón is a Tax Counsel on the Regulatory Analysis team at Sovos. He is licensed to practice law in the Dominican Republic and is a member of the Dominican Bar Association. He has a Certificate Degree from Harvard University as well as a J.D. from the Universidad Autonoma de Santo Domingo. Ramon has written a number of essays about tax administration and has won the first prize in the international essays contest sponsored by the Inter American Center of Tax Administrations (CIAT). Prior to joining Sovos, Ramon worked for more than 10 years in the Department of Revenue of the Dominican Republic where he served as Deputy Director. He is proficient in French and Spanish.
Share This Post

EMEA VAT & Fiscal Reporting
September 17, 2019
Why Storage of Electronic Invoices in the EU Gets Complicated Quickly

It’s very possible that US companies are breaking laws governing storage of electronic invoices in the European Union without realizing they’re putting themselves at risk for financial penalties.  The EU is an entity that, as the Brexit debate has shown, can frustrate and baffle its own citizens. In the US, the EU is frequently misunderstood. […]

Tax Information Reporting United States
September 16, 2019
6 Reasons You Should Attend the 2019 GCS Intelligent Reporting Summit

The tax information reporting event of the year is coming in October! Sovos will present the 2019 GCS Intelligent Reporting Summit in San Antonio Oct. 28-30. You can’t afford to miss it! Here’s why:  NEW! Unclaimed Property Regulations: De-mystify unclaimed property reporting and learn how to protect your company from risk you might not even […]

Tax Information Reporting United States
September 13, 2019
California AB5 Gig Economy Bill will Affect Tax Reporting, But How?

California Governor Gavin Newsom is poised to sign into law a bill that would recategorize gig economy workers such as ride-share drivers from being independent workers to full-time employees.  The bill, California AB5, could have a profound impact on tax withholding and information reporting at state levels, with other states closely monitoring California’s activity. It […]

Sales & Use Tax United States
September 12, 2019
New Sales Tax Laws Require Ecommerce Retailers to Step up Cyber Monday 2019 Preparations

5 steps ecommerce retailers should take to prepare for Cyber Monday 2019 Retailers with ecommerce channels have a lot to gain during Cyber Monday or Cyber Week in 2019. According to BlackFriday.com, Cyber Monday spending is anticipated to grow 20% this year, with consumers spending nearly $9.5 billion online. Cyber Monday also falls on December […]

EMEA IPT
September 5, 2019
Location Location Location

EU and local legislation Location of risk is one of the key criteria an insurer must identify and consider before thinking about insurance premium taxes. It’s important to understand the location of risk rules and apply them correctly to be able to settle insurance premium taxes compliantly and to the correct tax authority. Whilst location […]