The Withholding Income Tax Return (DIRF) is among the first obligations of the Brazilian tax calendar according to Normative Instruction no. 1.990 issued by the Federal Revenue Service Department in the Official Federal Gazette on November 18, 2020.
It is important to be in the know of all aspects that involve such obligation to avoid headaches with the tax administration. Therefore, we have gathered important information regarding the DIRF to help you understand what this tax return is about and what are the changes that come into effect as of 2021. See below:
What is it?
The DIRF is a tax return that must be submitted by individuals and legal entities subject to Income Tax Withholding (IRRF) last year, even if in a single month of the calendar year of 2021. The Withholding Income Tax Return of 2021 must be submitted by February 28, 2022.
Payments made abroad to individuals and legal entities
The payment, credit, delivery, employment or remittance to individuals or legal entities residing or domiciled abroad must be reported in the DIRF, even if there has been no tax withholding, including in cases of exemption or zero rate.
Points of attention in the 2022 DIRF
Among those who must submit the tax return are:
- head offices of private legal entities domiciled in Brazil, including those that are exempt;
- the branch offices or representations of legal entities with head office abroad;
- sole proprietorships;
- employees’ and employers’ union associations and organizations;
- holders of registration and notary services;
- building condominiums;
- investment fund or club managing or intermediary institutions;
- port labor managing bodies;
- candidates to elected offices.
What are the deadlines?
The deadline for the submission of the DIRF related to the year of 2020 is February 28, 2022.
What are the consequences in case of failure to submit?
The taxpayer who fails to submit the DIRF by February 28 shall be subject to fine, of a minimum between R$ 200 and R$ 500, depending on each case.
Any questions? Contacts us at firstname.lastname@example.org. We will be glad to help you submit your tax return.
Written by Maikon Luiz, Head of Operations BR
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