The Accounting Tax Bookkeeping, or ECF in the Portuguese acronym, is the annual document that must be used to report the calculation of income tax and social contribution on the net income of companies. This year’s delivery deadline, exceptionally, will extend to the last business day of September.

In order to fully enable all the data required to complete the ECF, and thus ensure the compliance of the business organization, good accounting performance is essential, with reliable data, in order to not have any questions from the Tax Authorities due to incorrect or incomplete data.

To learn more about how the annual delivery of the income tax return of companies in Brazil is carried out, continue reading this article.

Main aspects of the ECF

As a complex ancillary obligation, there are specific points in the ECF that deserve more attention. Each record, or data block, has its peculiarities at the time of filling.

It is extremely important to pay attention to filling out the ECD (Digital Accounting Bookkeeping) in advance, as this will be the basis for filling out the ECF, especially in the Corporate Period versus Calculation Period, change in the chart of accounts, during the calendar year, and reference chart of accounts. 

A detailed examination of the operations carried out must also be carried out, offering and proving values in their total veracity, even more, recognizing and aligning the crossing of data in the ECF with those declared in the DCTF (Declaration of Federal Tax Debts and Credits), since This is one of the IRS’s standard procedures. This type of verification will provide you with security at the time of delivery, and, with all compliance up to date, this accuracy will only be a consequence of all the good audit work already carried out.

Risks involved

One of the major risks involved in the delivery of the ECF is the comparison of its calculation data with the calculations carried out in the previous year for the purpose of calculating the amounts collected monthly by way of anticipation of Income Tax and Social Contribution on Net Income.

Any discrepancies, whether caused by an error in filling out or by an error in the calculation made previously, can cause questions and assessments by the Federal Revenue Service of Brazil. As with any federal debt, amounts that may not have been collected, or differences generated by errors in filling out the ECF, will generate fines and monetary restatement.

To ensure assertiveness in filling out the ECF, and thus mitigate risks of assessment, it is essential to have specialists who have real experience in filling out this accessory declaration. This is in fact the most important delivery of the year for the relationship with the federal tax authority, so be careful.

Gescon

Gescon is an accounting, tax and social security outsourcing company with more than ten years in the market in Brazil. Our experts have extensive experience with ECF, and are prepared to advise your company in all stages of the process.

To learn more about how we can help your team, contact our team of executives through our website at www.gescon.com.br.