1. Localizations for Brazil Implementation Guide
  2. Example of Withholding by Payment Due Date for Withholding Method 1

Example of Withholding by Payment Due Date for Withholding Method 1

Suppose that you have set up the following criteria for calculating PIS, COFINS, and CSLL withholdings:

  • The company is set up to calculate the withholding amounts based on the month of the payment in the Withholding Taxes on Services - Calculation Method program (P76B220).

  • The company is set up to use Withholding Method 1 in the PIS-COFINS-CSLL Minimum Withholding Setup program (P76B410), and the minimum amount is 10.00 BRL (Brazilian reais).

  • The rate for PIS withholding is set up as .65%.

  • The rate for COFINS withholding is set up as 3%

  • The rate for CSLL withholding is set up as 1%.

If your company is set up using the criteria listed above, the system writes the withholding lines for PIS, COFINS, and CSLL withholdings when the total of the withholdings per payment exceeds the minimum amount for withholdings that is set up in the PIS-COFINS-CSLL Minimum Withholding Setup program.

For example, suppose that you have different due dates for two lines on an invoice. If each payment is 200 BRL, then neither payment would have withholding amounts written to the nota fiscal because the total of the withholding amounts for PIS (1.3), COFINS (6) and CSLL (2) would equal 9.3, and would be below the minimum of 10 that is set up for the company.

However, if the payment due date for both lines is the same date, then the system would calculate the withholding amounts and write lines to the nota fiscal for each withholding type because the total of the withholding exceeds the minimum amount established in the PIS-COFINS-CSLL Minimum Withholding Setup program.