Inactive companies and their obligations

Inactive companies and their obligations

Many people may have doubts or simply ignore an inactive company and its consequent obligations, so today we're going to deal with the main issues surrounding this topic.

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Inactive company, active legal obligations: Understand

We know that the process of closing down a company is not so simple. Even if the company is not carrying out any activity, it is essential to keep its legal obligations up to date. 

A company is considered inactive as soon as it does not carry out any operational or financial activity.

Therefore, it is worth noting that the tax contribution relating to previous calendar years, such as the fine due to non-compliance with a specific ancillary obligation, does not automatically characterize a company as inactive. 

Entrepreneurs need to understand that an inactive company and a company with no movement are different concepts and practices, since while an inactive company is one that has no activity, a company with no movement carries out transactions from time to time.

However, keep an eye on the processes carried out in inactivity during the calendar year, such as:

• Fusion process
• Acquisition
• Incorporation

However, they are still required to submit the Inactive Federal Tax Debts and Credits Statement (DCTF). 

Collecting taxes is one of the obligations, but all companies need to transmit tax, labor and social security information to the respective supervisory bodies, and much of this must be done through the Public Accounting and Tax Digital Bookkeeping System (Sped), which makes it possible to send all the required information virtually. 

Companies that opt for the Presumed Profit regime operate with a profit margin that is pre-set by law, which serves as the basis for the tax burden in general, especially when it comes to Income Tax (IR) and the Social Contribution on Net Profits (CSLL).

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Until 2014, all companies had to submit the DIPJ to the IRS

The purpose of this obligation was to report the results of all operations carried out by the company between January 1st and December 31st of the calendar year.

After that, the DIPJ was replaced by the Tax Accounting Bookkeeping (ECF), a document that must be transmitted electronically via Sped by the last working day of July. 

The ECF requires the taxpayer company to notify all transactions relating to the IRPJ and CSLL calculation base during the calendar year. If this is not done, the company is subject to penalties imposed by the tax authorities.

With the Declaration of Federal Tax Debts and Credits (DCTF), it consists of presenting all the amounts paid and owed on taxes and other federal contributions such as:

• Corporate Income Tax (IRPJ)
• Contribution to Social Security Financing (Cofins)
• Withholding Income Tax (IRRF)
• Provisional Contribution on Financial Transactions (CPMF)
• Tax on Financial Operations (IOF)
• Rural Property Tax (ITR)
• Social Contribution on Net Profit (CSLL)
• Social Integration Program (PIS)
• Public Servant Equity Formation Program (Pasep)

All directed to the Federal Revenue Service.

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Entrepreneurs who don't formalize closure can ignore ancillary obligations

Inactive companies are exempt from transmitting the Social Contribution Calculation Statement (DACON) and the FGTS Payment Form (GFIP), as long as they have remained in this condition throughout the calendar year. 

In the case of non-moving companies, they must submit all the ancillary obligations that are common to any business.

The DCTF is a compulsory declaration for various companies opting for Presumed Profit, Real Profit - as well as consortia, budget management units, micro-enterprises and small businesses in specific situations. 

And these situations include inactive companies. 

Micro-enterprises (ME) and small companies (EPP) opting for the Simples Nacional system also need to submit the Inactive DCTF.

However, it is important to remember that they must not carry out any activity during the calendar year. 

It's very common to see entrepreneurs with tax problems due to non-payment of their obligations. 

If you need to rely on experienced accounting advice, capable of providing the best strategies for your company to improve its financial performance, get to know CLM Controller's solutions now.