The Internal Revenue Service of Brazil has new instructions about the Voluntary Disclosure and Amnesty Program.

In September, the Internal Revenue Service of Brazil (RFB) issued new instructions about the Voluntary Disclosure and Amnesty Program ("RERCT"), by publishing RFB Instruction ("IN/RFB") 1,832/20181.

In this article, we will address the novelties brought about by RFB IN 1,832/2017:

  1. Causes of exclusion from RERCT
  2. Consequences to providing false statements
  3. Annulment of RERCT Membership
  4. Review procedure of reported amounts

1. The Internal Revenue Service of Brazil has established the understanding that if the following declarations by taxpayers are proved false2, it will cause exclusion from RERCT:

  • that the taxpayer has not been convicted in a criminal action, even if the judgment has not become final, whose object is one of the crimes in paragraph 1 of art. 5 of Law 13,254/2016;
  • that the taxpayer was resident or domiciled in Brazil on December 31, 2014, according to the tax legislation; and
  • that on January 14, 2016, the taxpayer did not have a position, job or public management or elective function and that he or she did not have a spouse or blood relative similar, to the second degree, or by adoption, under those conditions.

2. Before, submission of false information on the issues above, made joining the amnesty program null and void, i.e., adhesion was deemed as if it had not taken place. Consequently, the provisions of "RERCT Law" (Law 13,254 / 2016) should not apply.

Now, if those false statements are deemed to have been made:

  • the amounts of taxes, fines and interest will be collected, deducting the amount previously paid, without prejudice to the applicable civil, criminal and administrative penalties; and
  • the initiation or continuation of investigative procedures regarding the origin of the assets may only happen as to the origin of the assets in the scheme if there is documentary evidence not related to that taxpayer's reported information.

3. Joining RERCT will also be void if:

  • the Exchange and Tax Regularization Report ("DERCAT") has not been presented; and;
  • if the income tax at a 15% rate and the fine stipulated under that amnesty program have not been paid in full.

4. Lastly, the Internal Revenue Service of Brazil included a new section to the chapter on the procedures applicable to3 RERCT, dealing with the procedures to review amounts reported:

  • The tax authority will issue a tax deficiency notice when the amounts reported by the taxpayer are incorrect, requiring payment of taxes and legal charges on amounts incorrectly reported under the terms of the income tax legislation.
  • After the tax deficiency notice is drawn up, full payment of taxes and legal adjustments, within 30 days, will extinguish the punishment of crimes committed by the taxpayer and provided in paragraph 1 of art. 5 of Law 13,254 /2016, related to assets whose value was incorrectly reported.
  • The taxpayer will have up to 30 days, from the date on which he or she receives the subpoena, to challenge the assessment.


[1] RFB IN 1,832/2018, published on September 24, 2018, in the Federal Register, amends provisions in RFB IN 1,627/2016 and RFB 1,704/2017.

[2] Items V, VI and VII of the head of art. 7 of RFB IN 1,627/2016.

[3] Included by article 30-A of RFB IN 1,832/2018.

Originally published October 02 2018

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.