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How to dissolve a company in Brazil

The Brazil Business

Updated

10 September 2012

We are always teaching how to start doing business in Brazil, but just as important as opening a company, it is important to know how to dissolve one. This article will provide you with seven steps to close a company in Brazil.

1 - Elaborate the dissolution

All partners must sign the closure minute and name a liquidator, that can be one of the partners. This liquidator will be in charge of eliminating debts. Then the Distrato Social is elaborated. Distrato Social is a document that establishes that the company has been dissolved and the assets have been divided among the partners.

This document must contain how much each partner has received and mention the person who will be in charge of the assets and statutory books.

Once the Distrato Social is signed, all partners must agree with the company dissolution. In case the partners do not agree with it, than it will be necessary to get a negotiator, which can be a lawyer or the company's accountant.

If still there is no agreement regarding the dissolution of the company, then the situation must be taken to court, making the company dissolution even slower and expensive.

2 - Social Security

Regardless on having employees or not, the company must check its situation with INSS, which is the Brazilian Social Security organization.

If the company has paid all social security contributions, then it is time to obtain the Certidão Negativa de Débito, which is a certificate stating that the company has paid all its debts with INSS. This certificate is obtained for free at the Social Security and is valid for 180 days.

If the company still has got debts to be regularized with INSS, then its representative must access Receita Federal website and schedule an appointment at one of the Receita Federal do Brasil offices to solve the situation.

3 - FGTS Certificate of Regularity

CRF - Certificado de Regularidade do FGTS – is a document issued by Caixa Econômica Federal in which the regularity of the employer before Fundo de Garantia do Tempo de Serviço is certified.

This document is mandatory and can be issued at Caixa Econômica website . In case the situation is not regularized, then the representative must regularize it at one of the units of Caixa Econômica Federal.

4 - Cancel the company's registration

Companies paying municipal taxes, such as ISS, will need to cancel their registration on the municipality database. Each municipality establishes a list of required documents and all the taxes the company has to pay. To have access to these information, the company representative must get in touch with the Secretary of Taxation and Revenue of the municipality where the company is located.

Companies paying ICMS must have a representative going to Secretaria da Fazenda to cancel their registration.

5 - Acquire certificates from Ministério da Fazenda

The Receita Federal do Brasil checks if the company has collected all federal taxes, such as IRPJ, PIS, COFINS and CSLL.

In order to testify its regularity with the federal government, the company must issue a Certidão Negativa Conjunta, which corresponds to the Certidão Negativa de Inscrição de Dívida Ativa da União, issued by Procuradoria da Fazenda Nacional, and the Certidão de Quitação de Tributos e Contribuições Federais, issued by the Receita Federal do Brasil.

All these documents have the purpose of proving that the company is not in debt with Receita Federal do Brasil and can be issued online at the Procuradoria Geral da Fazenda Nacional website and the Receita Federal do Brasil website

6 -File documents at the board of trade

File requests must be reported to the board of trade and the following documents must be presented:

Certidão Conjunta Negativa de Débitos and Certidão Negativa de Débito (Non-debt certificates), issued by INSS
Certidão de Quitação de Tributos e Contribuições Federais (a certificate stating that all federal taxes have been paid) issued by Secretaria da Receita Federal.
Certificado de Regularidade do FGTS (CRF – already mentioned on step 3), issued by Caixa Econômica Federal.

7 - Cancel the registration on CNPJ

The last step to dissolve a company is to cancel its registration on CNPJ, which is the company's federal taxes ID. For this, the company's representative must go the Receita Federal do Brasil website and download an application called PGD-CNPJ. This application initializes the cancellation request and another document named Documento Básico de Entrada (DBE). This last document must be signed at a notary office.

Then the company's representative must present the DBE at a Receita Federal do Brasil office in two copies, issued by the PGD CNPJ application. If no debt is detected, the registration on CNPJ will be canceled within three days.