2021 Dirf: the report must be filed by February 26

The Withholding Income Tax Statement (Declaração do Imposto de Renda Retido na Fonte - “Dirf”) is an obligation that must be reported by legal entities and individuals who had income tax withheld on paying source (Imposto sobre a Renda Retido na Fonte - “IRRF”) in the last year, even if in just a single month. In addition, there are the contributions related to employee payroll, among some other cases listed in the RFB Normative Instruction 1990/2020.

In this year, the statement should be reported by February 26. The 2021 Dirf generator program can be downloaded from the Federal Revenue of Brazil's website.

What should be reported?

• Income paid to individuals domiciled in Brazil, including those exempt and non-taxable under the conditions specified in the legislation;
• Value of tax on withheld income and/or contributions, from income paid or credited to beneficiaries;
• Payment, credit, delivery, employment or remittance to an individual or legal entity residing or domiciled abroad, even if the tax has not been withheld, including cases of exemption or 0% rate;
• Payments to health care assistance in the collective business modality;
• Amounts related to deductions, in the case of employment agreement.

Taxpayer who does not meet the deadline is subject to a penalty

Taxpayers who fail to report 2021 Dirf within the deadline will be subject to a 2% fine per calendar month, which falls on the amount of taxes and contributions indicated in the statement.

The minimum amount of the penalty is BRL 200.00 for individuals, inactive legal entities, and those opting for the Simples Nacional. In other cases, the minimum amount is BRL 500.00.

It is noteworthy that, cases of statements with errors or omissions there are also applicable penalties.

Highlights for legal entities

One of the highlights is the case of companies extinct due to liquidation, incorporation, merger or total demerger. In these situations, the legal entity must present the Dirf for the calendar-year of the extinction until the last business day of the month following the event, except if it occurs in January, in which case Dirf may be presented by the last business day of March of the same calendar-year.