By Tax Area

On April 11th, 2022, the Office of the National Treasury General Attorney's Office (PGFN) published PGFN Order No. 167, which waives the collection of taxes on real estate exchange involving legal entities opting for the assumed profit regime.

The Superior Court of Justice had already consolidated the jurisprudence in the sense that real estate exchange cannot be equated with the purchase and sale for tax purposes, waiving the characterization of revenue, billing or profit, and subject to the incidences of IRPJ (Corporate Income Tax), CSLL (Social Contribution on Net Income), PIS (Social Integration Program) and COFINS (Contribution to the Financing of Social Security) when the company opts for the assumed profit regime.   

Based on the consolidated understanding of the Superior Court and Law 10.522/2002, the PGFN exempted the national treasury's attorneys from presenting: (i) defense, (ii) offering briefs, and, (iii) filing appeals and, in addition, they shall request the withdrawal of those that have already been filed, in the cases of lawsuits dealing with the matter in question.

It is important to highlight that the PGFN guideline only covers exchange agreements without a supplementary installment. Thus, we warn the Taxpayer that, in cases where there is a cash supplement, which is understood as it becomes, the taxation will be levied on this installment.

The PGFN's new position, pursuant to Article 19-A of Law 10.522/2002, also results in the obligation of the Tax Auditors of the Federal Revenue Service not to constitute tax credits on the same subject matter, under penalty of annulment.

Finally, if the Taxpayer has already paid taxes on the real estate exchange under the conditions described herein, there is the possibility of requesting the refund, provided that the payment has taken place in the last five (05) years.