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CSLL Surcharge for Multinational Companies in Brazil: Alignment with OECD Pillar 2 Rules

The special secretary of the Federal Revenue, Robinson Barreirinhas
Photo: Edu Andrade/MPO Source: https://www.folhape.com.br/economia/adicional-da-csll-sobre-multinacionais-e-medida-defensiva-ao-erario/364681/

Pillar 2 of the OECD’s global taxation project, known as Global Anti-Base Erosion (GloBE), aims to establish a minimum income tax rate on the profits of large multinational corporations , preventing them from shifting their profits to low-tax countries. As part of this global effort to promote greater tax equity, Brazil implemented Normative Instruction RFB No. 2,228/2024 , which introduces the Additional Social Contribution on Net Profits (CSLL), with a minimum rate of 15%. This measure aims to align the taxation of multinationals operating in Brazil with the new rules established by Pillar 2 of the OECD, which come into force in 2025.


Is your company prepared for the new tax regulations that will impact multinationals in Brazil?


The Federal Revenue Service published Normative Instruction RFB No. 2,228/2024 , based on Provisional Measure 1,262/24 , which establishes the Additional Social Contribution on Net Income (CSLL). This additional tax aims to ensure that companies belonging to multinational groups with annual revenues exceeding 750 million euros are subject to a minimum effective tax rate of 15% on profits obtained in Brazil.


Is your company part of a multinational group?


This new regulation impacts all “Constituent Entities” whose results are included in the consolidated financial statements of multinational groups with operations in more than one jurisdiction. Companies that have reported global revenues exceeding 750 million euros in at least two of the last four fiscal years will be subject to the CSLL Surcharge, effective January 2025.


How to calculate the CSLL Additional?


The calculation of the effective tax rate of 15% takes into account the excess profits and taxes already paid by all group entities in Brazil. The difference between the minimum tax rate of 15% and the effective tax rate will determine the additional amount to be paid.


Who will be responsible for payment?


The CSLL Surcharge will be distributed proportionally among all group entities in Brazil, based on surplus profits or, alternatively, on net equity, if another form of allocation is not possible. However, groups may choose to designate a single entity to make the payment, assuming joint and several liability among all group entities.


How does MP 1,262/24 impact entities with tax losses?


The rule also provides specific treatment for Deferred Tax Assets (DTA), allowing companies with negative results to adopt alternative methods to offset future positive results. This adjustment may be essential for companies in recovery or seeking to strategically plan their future taxation.


What are the main dates and obligations for companies?


Companies must be ready to calculate and pay the CSLL surtax by the seventh month after the end of the fiscal year. In addition, it is crucial to provide all information required by the IRS to ensure compliance with the rules. Failure to comply may result in significant fines, which can range from 0.2% of total annual revenue per month of delay, with a maximum limit of R$10 million.


How can Brinta help?


If your company is part of a multinational group or suspects that it may be impacted by this new legislation, Brinta can assist you with tax planning solutions, reviewing the impact of the CSLL Surcharge on your total tax burden.


With these new rules coming into effect in 2025, it is essential to prepare to meet the requirements and optimize your tax strategy. Contact us and find out how we can help you navigate these complex tax rules, ensuring compliance and minimizing the tax impact.


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