What is Block K: Everything you need to know about this tax obligation
If there's one thing that causes doubt among entrepreneurs, it's block K. This is one of the parts of the Sped Fiscal ICMS/IPI and its purpose is to record production and stock control. Although it was put into practice in 2016, its implementation is still ongoing.
That's why it's essential to understand better what it is and how it works. That's what we're going to present in this post. In addition, we'll show you the positive impacts on management and how an accounting service, such as CLM's, can help you. Follow along!
[Article]: Delighting the customer: the key to business success
What is Block K anyway?
Block K is designed to control production and stock. Its purpose is to provide the tax authorities with monthly information on the production and consumption of inputs, and the booked stock of industries or similar establishments and wholesalers. The aim, therefore, was to oblige companies to establish this control of items purchased and not sold.
[Article]: Delighting the customer: the key to business success
The information provided consists of
- stock balance;
- losses in the production process;
- information on the finished product;
- products manufactured by the establishment or by third parties.
The aim is to reduce tax evasion and prevent companies, even reputable ones, from showing variations and differences in inventories, as this attracts inspection. The result, in this case, is the generation of fines and penalties.
[Article]: The role of accounting in multinationals' compliance with tax regulations
Three Essential Facts that Shape Consumer Policies:
In addition, the government uses this information to understand variations in consumption across the country. For this reason, it is compulsory to submit three main pieces of information:
- record 0200: this is the table identifying the items from the register of products and services offered;
- K200 record: is responsible for recording stock;
- K280 record: corrects production booking.
This data is required because the purpose of block K is to correct the differences between the values in the K200 record. Therefore, it does not record the divergence between the stock reported and block H, which refers to inventory.
What are its positive impacts on management?
Companies obliged to work with block K need to have greater control of production and stock. As a result, it improves its management processes with the help of technology and specialized professionals.
For smaller companies, this work becomes a competitive differentiator, because large companies will prefer to do business with companies that provide the data correctly.
With this, there is more agility and professionalism in the operational routine. Other benefits include:
[Article]: Tax compliance, you must comply to grow!
Increased integration
Companies that meet this requirement need to organize their product registry according to the Mercosur Common Nomenclature (NCM) and their production activity. This leads to the elimination of duplicate codes and the sanitization of descriptions, which makes the records standard.
[Article]: Foreign businessmen see price, not value, in accounting services
Improved stock control and management
The production and inventory management process in the company is improved with the information required by Block K. This is because more data needs to be available and specific tools such as the Product Configurator and business management systems need to be used.
[Article]: Learn why fiscal management is important
Increased company credibility
A business that meets its obligations on time conveys an image of trust to partners and suppliers. This shows that management is more efficient and the organizational culture values compliance, i.e. good practices.
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.
Upgrade your finances:
Talk to us!
