Brazil: Tax incentives for research and development | KPMG | GLOBAL

Brazil: Tax incentives for research and development in information technology

Brazil: Tax incentives for research and development

There is guidance concerning the compliance rules for companies benefiting from tax incentives relating to research and development in information technology.

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Ordinance No. 4,561 / 2017 (Portaria nº 4.561/2017) was published in August 2017 to provide guidance for companies claiming tax incentives with respect to taxpayer project evaluations by the Ministry of Science, Technology, Innovation and Communications (Ministério da Ciência, Tecnologia, Inovações e Comunicações – MCTI). The preliminary results of analysis of annual reports (Relatórios Demonstrativos Anuais - RDAs) are intended to demonstrate compliance of specific activities and of their classification as eligible expenditures.

If a company receives “negative results” on analysis of the RDAs, the company may counter these findings by filing an objection within 30 days from the date of the opinion (with an additional 30 days being allowed on request). If the analysis refers to more than one tax year, it is possible to extend the deadline for submitting the response by another 15 days for each contested year.

The company’s challenge of negative findings must include findings of fact and of law, and must be accompanied by supporting documentation. If the challenge is rejected, the company has 30 days in which to file an administrative appeal.

 

Read an August 2017 report (Portuguese) prepared by the KPMG member firm in Brazil

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