Electronic invoicing in Brazil
Brazil is widely regarded as a major player in the world of electronic invoicing, largely due to the sheer number of electronic tax documents and e-invoicing models it has in place. If you’re a taxpayer in Brazil, you will have to issue electronic invoices.
From electronic transport invoices to standard e-invoices for tax, there is a lot to consider when operating in Brazil. This page has all the electronic invoicing information you need to be aware of your obligations and will be updated when necessary, so bookmark the overview to add it to your compliance toolkit.
Table of contents
1. How does e-invoicing work in Brazil?
2. Characteristics of electronic invoicing in Brazil
3. Format of electronic invoices and documents in Brazil
6. What is the CT-e | Electronic Transportation Invoice?
7. E-signature requirements in Brazil
8. Timeline of e-invoicing adoption in Brazil
9. Penalties: What happens if I don’t comply with e-invoicing in Brazil?
10. What else do I need for VAT compliance in Brazil?
While there are several e-invoice types in Brazil, there is a general process that taxpayers need to follow when issuing invoices electronically. While some steps may vary per invoice type, the process often includes:
- Applying for a digital signature
- Generating an electronic invoice in XML format
- Submitting the invoice via web service to SEFAZ (Secretaria da Fazenda Estadual)
- Sending the invoice to the customer
Characteristics of electronic invoicing in Brazil
Brazil B2B e-invoicing
In Brazil, issuing electronic invoices – of which there are several types – is mandatory for all taxpayers. If a business is established in Brazil and supplies goods or services, it must participate in the country’s e-invoicing initiatives.
There are numerous electronic invoicing systems in Brazil, and the product category of goods supplied dictates which system will be used.
Brazil B2G e-invoicing
E-invoicing is mandatory for all established businesses in Brazil, including when issuing invoices to governmental and public administration entities.
Format of electronic invoices and documents in Brazil
Brazil has a complex, somewhat fragmented e-invoicing system that requires taxpayers to use specific systems – depending on the category of the goods or services they supply. To ensure compliance, organisations and persons alike must be aware of what’s required of them when issuing an electronic invoice.
While there are several e-invoice types in the country, there are specific characteristics of electronic invoices. Electronic signatures are required no matter the invoice type, and the documents need to be securely archived for five years. Each invoice type is in a structured XML format, and they need to be validated by the Brazilian tax authorities before being issued to the buyer.
NF-e invoices
The NF-e electronic invoice is Brazil’s standard electronic invoice for documenting the transaction of goods and services.
It is issued electronically to the buyer and the Brazilian government. To be deemed legitimate, NF-e e-invoices must be validated by the tax authority.
NFS-e invoices
Unlike Brazil’s standard electronic invoice, NFS-e e-invoices document the transaction of services. Like NF-e e-invoices, NSF-e documents must be transmitted electronically and validated by the Brazilian government.
What is the CT-e | Electronic Transportation Invoice?
CT-e documents are also known as electronic transportation invoices. These e-invoices document the transportation of goods in Brazil via:
- Air
- Pipeline
- Rail
- Road
- Water
When using a transport service that is external to the company fulfilling the transaction, the buyer must validate the CT-e e-invoice and list it in its monthly report to the government.
E-signature requirements in Brazil
Brazil requires e-invoices to be protected by an electronic signature. This technology irrefutably proves the signing parties’ identity and the document’s integrity.
Once signed by the seller and the buyer, the e-invoice is considered valid from both a legal and fiscal standpoint – especially considering that invoices are also validated by the tax authorities.
Timeline of e-invoicing in Brazil
Brazil was an early adopter of electronic invoicing, though the implementation took time. Here are the key dates of the country’s e-invoicing implementation:
- 2005: Brazil publishes its first e-invoicing legislation, introducing a clearance model
- 2008: Taxpayers became obligated to issue electronic invoices
- 19 April 2023: Electric energy e-invoices (NF3-e) are introduced, with staggered implementation of mandated use
- 1 September 2023: Individual micro-entrepreneurs (MEI) that are not subject to Interstate Sales Tax (ICMS) are obligated to issue e-invoices
Penalties: What happens if I don’t comply with e-invoicing in Brazil?
There is a price to pay for failing to comply with Brazil’s e-invoicing regulations. Drastic cases of non-compliance may be considered a criminal offence, such as tax evasion.
Taxpayers can be charged a financial penalty of up to 100% of an invoice’s value or transaction price should they fail to issue an e-invoice. This same penalty may apply if electronic invoices do not meet legal and technical requirements.
What else do I need for VAT compliance in Brazil?
While you must stay on top of your e-invoicing regulations in Brazil, additional tax compliance considerations exist.
We have a dedicated page for Brazil VAT Compliance that is a companion tool to this e-invoicing overview, carefully detailing other tax-related regulations that may apply to you.
FAQ
Is e-invoicing mandatory in Brazil?
E-invoicing is mandatory for all established taxpayers in Brazil.
Who needs electronic invoicing in Brazil?
All established taxpayers in Brazil are required to issue electronic invoices.
Can an electronic invoice be cancelled?
Electronic invoices can be cancelled in Brazil, but the time required may differ depending on the taxpayer’s state of operation.
How much time is there to cancel electronic invoices in Brazil?
Generally, an electronic invoice for goods can be cancelled within the first 24 hours of its validation by the Brazilian tax authorities. That said, this may differ state-by-state, so verifying the deadline with the SEFAZ is important.
What information should be included in an electronic invoice in Brazil?
As a rule, the NF-e must contain registration data such as CNPJ (National Register of Legal Entities), address and other data of both the issuer and recipient, as well as information such as product code, description, quantity, unit value and details about taxes such as ICMS, IPI, PIS, COFINS, among others, and a valid digital signature. Electronic invoices must be in XML format.
Setting up e-invoicing in Brazil with Sovos
With electronic invoicing becoming more common globally, following the lead of Latin American countries like Brazil, it is important to prioritise compliance.
The global – yet fragmented – adoption of e-invoicing solidifies the need to choose a single vendor for complete compliance wherever you do business. Sovos is a tax compliance partner you can trust.
Focus on what truly matters: speak with Sovos today to reclaim your time.
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