Understand how the Internal Revenue Service's data cross-checks identify inconsistencies and find out how to prepare your company to avoid tax risks.
The Federal Revenue Service's data cross-checking is one of the main tools used by the Brazilian tax authorities to combating fraud, evasion and inconsistencies in tax returns.
It is worth noting that this process has become increasingly sophisticated, integrating information from different sources - electronic invoices, bank transactions, tax returns and even data from state and municipal agencies.
For companies that deal with a high volume of operations and accounting records, the issue is especially relevant. Small errors or integration failures can draw the attention of the tax authorities and result in fines and loss of credibility in the market.
In this article, we'll show you how cross-referencing works in practice, what risks it brings to companies of different sizes and what preparation measures strategic accounting can adopt to reduce vulnerabilities. Have a good read!
What is Receita Federal's data cross-checking and how does it work?
Cross-referencing data from Internal Revenue Service consists of the automatic comparison of information provided by taxpayers in different tax obligations. In practice, the system checks that the data sent by companies and their business partners is consistent.
This process is possible because the IRS maintains integrated databases, which receive data in real time from documents such as:
- NF-e (Electronic Invoice): information on sales and purchases made;
- EFD-Contributions and EFD-ICMS/IPI: records of federal and state taxes;
- DIRF and eSocialpayroll data, withholdings and contributions;
- Financial statementstransactions sent by banks and credit institutions.
When there is a discrepancy, for example, if the company declares a different revenue figure to the one reported by the supplier in its invoiceThe system flags the inconsistency, which can lead to inspection and collection.
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Why has the cross-checking of information become more rigorous in recent years?
The advance of digitalization and the integration of tax systems has made cross-checking information a central part of the Revenue Department's work.
Previously, data was analyzed manually and fragmented; today, the use of artificial intelligence and algorithms allows errors to be detected in seconds.
Some factors that have intensified this process are:
- SPED (Public Digital Bookkeeping System)The new tax law: unified various tax obligations in an electronic environment;
- Integration of electronic invoicesThis has made it almost impossible to omit commercial transactions;
- Sharing banking and financial dataThe new system: it gives the tax authorities visibility of transactions that are incompatible with the declarations;
- Tax automationpreventive analysis systems cross-check millions of records every day, reducing the need for face-to-face inspections.
This scenario increases the need for more robust internal controls, since simple inconsistencies, such as invoices not posted correctly, can generate immediate questions.
What are the main risks for companies of the Internal Revenue Service's data cross-checking?
Ignoring the seriousness of cross-checking information can have serious consequences. The most common risks involve both financial and reputational issues. Let's get to know them!
Penalties and fines
When the system identifies discrepancies, the Revenue can assess the company, charging unpaid taxes with interest and fines that can exceed 75% of the amount owed.
Opening detailed inspections
An inconsistency can serve as a trigger for more extensive audits, requiring the company to present additional documents, contracts and explanations.
Reputation and credit problems
Companies that enter into litigation with the tax authorities are more vulnerable to losing credibility with business partners, investors and financial institutions.
Criminal risk in fraud cases
When the error is interpreted as intentional fraud, those responsible can be prosecuted for crimes against the tax order, with severe penalties.
These risks show why it is not enough to deliver obligations on time: it is essential to ensure that data is consistent and aligned across all systems.
How can inconsistencies be identified before the IRS cross-checks information?
The first step to reducing risks is to adopt strict control over the information you send. Small flaws, if left uncorrected, can turn into major problems in the IRS's automatic cross-checking.
This is why it is essential to establish routines and checking tools. Some practices make the process safer and more efficient. Get to know the main ones!
Perform detailed accounting and tax reconciliations
Checking must go beyond simply checking invoices. Tax documents must be compared with accounting entries, bank statements and stock reports. This internal cross-checking prevents duplication, omissions and incorrectly collected taxes.
Integrate internal systems and use tax automation
Disconnected platforms increase the chances of errors. By integrating ERP, purchasing, sales and accounting, data flows uniformly. Tax automation solutions even apply rules that block inconsistent entries at source.
Periodically review statements and management reports
Before sending obligations such as EFD-Contribuições or DCTF, validate the figures in internal reports. This step acts as a test of the cross-checking carried out by the IRS, allowing divergences to be detected in a preventive manner.
Conduct preventive audits and inspection simulations
Internal and external audits help identify hidden risks. Simulating the Internal Revenue Service's data cross-checking allows the company to anticipate failures and correct inconsistencies before being notified.
Monitor data in real time
Tax compliance software issues immediate alerts for invoices posted with the wrong tax rate or discrepancies between purchases and sales. This continuous monitoring prevents errors from accumulating over time.
How does strategic accounting help to reduce the risks of cross-checking data with the IRS?
Strategic accounting is not limited to recording operations; it acts as a partner for management to anticipate problems and organize processes.
In the context of the Internal Revenue Service's data cross-checking, this means adopting practices that reinforce compliance and prevent inconsistencies from generating fines. Among the main initiatives, we can highlight the following:
- structuring compliance processesThe main goal is to: create continuous monitoring routines, with checklists and reports that monitor the compliance of tax information and alert managers to potential risks;
- real-time monitoring of obligationsThe use of modern software that monitors tax data on a daily basis, identifying faults before the accounting period is closed;
- guidance on appropriate tax regimes: periodically analyzing the company's tax framework, ensuring that the chosen regime is the safest and most advantageous, avoiding errors resulting from inappropriate classifications;
- preparing for inspectionsThe main goal is to: organize reports and keep documentation up to date, reducing the impact of audits and making it easier to respond to tax authorities' demands;
- implementation of periodic internal auditsThe most important thing is to proactively review processes, simulating data cross-checks and anticipating inconsistencies that could lead to notifications;
- training administrative and financial teamsTraining professionals to deal correctly with invoices, entries and declarations, reducing operational failures that lead to discrepancies in tax systems.
When properly applied, strategic accounting transforms the cross-referencing of information from a risk into a competitive advantage, as it guarantees greater transparency, strengthens governance and conveys security to partners, investors and supervisory bodies.
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How can you prepare your company for the Internal Revenue Service's data cross-checking?
Rather than reacting to inspections, it is important to adopt a preventive stance. A few measures can transform cross-referencing information in a safe process for the company.
The first step is to invest in tax technologyby adopting automation solutions that reduce manual errors, integrate different systems and issue inconsistency alerts before the obligations are sent.
At the same time, it is essential to guarantee team trainingEmployees working in areas such as billing, purchasing and accounting need to be in line with tax regulations and understand the impact of their records on the returns sent to the tax authorities.
Another key point is to strengthen culture of compliance. Companies that see the compliance with tax obligations not only as legal obligation, but as part of the business strategyThey become more resilient and less exposed to risks.
Finally, counting on expert support makes all the difference. Strategic accounting advice correctly interprets legislation and guides the adoption of best compliance practicesensuring that the company is prepared for any type of inspection.
How CLM Controller helps your company prepare for data cross-checking
Relying on the support of those who understand the subject is decisive in avoiding risks in the field. data cross-checking by the Federal Revenue Service.
CLM Controller acts as a strategic partner for companies, offering not only the execution of accounting routines, but also a consultative vision that strengthens management and tax compliance.
Our services include detailed analysis of ancillary obligations, periodic reconciliations, preventive audits and advice on appropriate tax regimes.
In addition, we work with modern automation tools and intelligent reports that help detect inconsistencies before they are identified by the tax authorities.
With an experienced team that is up to date with the constant changes in legislation, CLM Controller ensures that your company is prepared for inspections, reduces the risk of fines and maintains credibility with partners, investors and public bodies.
More than avoiding problems, we offer security and predictability for the growth of your business.
O cross-checking of information, carried out by the Federal Revenue Service, does not should only be seen as a threat. It is also a mechanism that strengthens transparency and tax justice, reducing unfair competition and encouraging more ethical practices in the market.
Companies that are properly prepared not only avoid risks, but also demonstrate solidity and responsibility to clients, partners and investors. When viewed strategically, cross-referencing data from the Internal Revenue Service also becomes an opportunity to consolidate credibility and keep the company in compliance with the law.
Do you need to prepare your company for Receita Federal's data cross-checking? Contact CLM Controller and talk to our experts!
