Introduction to DCTF
In this article, we will learn everything about the DCTF, a Statement that needs to be submitted monthly to the Secretaria da Receita Federal, which is Portuguese for Federal Revenue Service.
The DCTF is one of the most important obligations imposed by the Receita Federal on legal entities. Its objective is to report the taxes and contributions of an entity to the Receita Federal.
What is it
Through the DCTF, Declaração de Débitos e Créditos Tributários Federais which is Portuguese for Federal Debits and Credits Tax Statement, the Receita Federal is to be advised of the value of tax liabilities assessed by taxpayers as well as if those liabilities were paid or not. The statement is also required to state whether taxes and contributions were paid, if there was a payment plan and whether there are any credits or compensations to be made.
By cross-referencing information electronically with other accessory obligations to which taxpayers are subject, the Receita Federal can go even further and check for various types of inconsistencies, including evidence of omission of income. With this information, the Receita Federal can determine which taxpayers have unresolved tax liabilities.
Taxes and contributions that must be declared to the DCTF:
- Corporate Income Tax Statement, the IRPJ
- Income Tax Withheld at the Source, the IRRF
- Tax on Industrialized Products, the IPI
- Social Contribution on Net Profits, the CSLL
- Tax on Financial Operations, the IOF
- Contribution for Social Integration Program and Program of Formation of the Patrimony of the Public Servants, the PIS/PASEP
- Contribution for Social Security Financing, the COFINS
- Contribution of Intervention in the Economic Domain, the CIDE
From 2010, all legal entities are required to submit the DACON, Statement of Verification for Social Contributions, which unites the Contribution to the PIS/PASEP with the Contribution to the COFINS. This can be found on the Receita Federal’s website.
Delivering the DCTF
The following legal entities are required to submit the DCTF:
- Companies not included in the program Simples Nacional
- The legal entity that is immune or exempt from the Corporate Income Tax Statement whose:
- Monthly contributions to be informed in DACON is equal or superior than BRL 10.000. The obligation begins in the quarter that the entity reaches this amount
- Immunity or exemption that has been suspended or withdrawn
- The legal entity which loses its “inactive” condition, starting in the quarter that the activity begins.
Submission of the DCTF is mandatory and must be provided monthly for all cases above, regardless of whether or not a debt is to be declared. The application that generates the DCTF is found on the Receita Federal’s website. Once the DCTF is complete, it is to be forwarded to the Receita Federal via the ReceitaNet application, downloadable here.
The monthly transmission of the DCTF must be made by means of a valid digital certificate like e-CPF or e-CNPJ.
Not Obliged to Deliver the DCTF
According to the Receita Federal, the following entities are not obliged to submit the DCTF:
- Legal entities immune or exempt from income tax, whose monthly contributions to be informed in DACON are less than BRL 10.000
- Small companies included in the program Simples Nacional
- Legal entities that remain inactive since the beginning of the calendar year or start date of activities
- Public organizations and local authorities
In the event of a merge, split or incorporation, the DCTF should be submitted on behalf of the:
- Part before the event: all information on taxes and contributions that have happened from the beginning of activities until the event
- Part after the event: all information on taxes and contributions happening after the event
The entities which fail to submit their DCTF within the alloted time frame or present it with mistakes or omissions will be subpoenaed to:
- Present the original document, in case of failure of submission
- Provide explanations, in all other cases
The entities that fit in the cases above need to respond to the Receita Federal by the deadlines set by the organization. They will also be subjected to these fines:
- Of 2% per month over the amount of taxes and contributions informed to the DCTF, even if fully paid, limited to 20% of the amount of taxes, in the event of failure of submission, or submission after the deadline imposed the Receita Federal.
- BRL 20,00 for every 10 incorrect or omitted informations
The fines will be reduced:
- By 50%, when the Statement is submitted after the deadline, but before any legal procedure is taken by the Receita Federal
- By 25%, if the Statement is submitted within the period specified in the subpoena
The minimum fine is:
- BRL 200,00 in the case of inactive legal entity
- BRL 500,00 in all the other cases