Deadline for joining debt negotiation program has been extended to May 31

“Zero Litigation” program provides for the renegotiation of debts under administrative litigation and small claims

In an extra edition of the Official Federal Gazette on March 31, the Office of the General Counsel for the Federal Treasury (PGFN) and the Federal Revenue Service of Brazil (RFB) published the PGFN/RFB Joint Ordinance No. 3/2023 , extending the deadline for joining the Program for Reduction of Tax Litigation (PRLF), also known as "Zero Litigation".

The application period, which has been open since February 1, was originally scheduled to end on March 31. With the new ordinance, however, applications may now be submitted until 7 p.m. on May 31, 2023.

Launched on January 12, the Zero Litigation Program sets special conditions for the renegotiation of federal tax debts under discussion with the Federal Revenue Judgment Office (DRJ) or with the Administrative Council of Tax Appeals (CARF) and of small claims under administrative litigation or registered as overdue federal tax liabilities.

Read more: Zero Litigation: Q&A about tax compliance program

The program was established as part of the government’s efforts to tackle the federal budget deficit and offers several options to encourage debt settlement. Taxes subject to renegotiation include the income tax (IRPF), social contributions (CSLL, PIS, Cofins) and the tax on manufactured goods (IPI).

Taxpayers who join the program may enjoy numerous benefits, such as being able to pay their debts in up to 12 monthly installments with up to a 100% reduction on interest and fines, and may also offset unused tax losses and carryforwards against 70% of the total amount owed.

Applications must be made through the Virtual Services Portal (Portal e-CAC) . Taxpayers must submit proof of initial payment to be eligible for joining the program.