Income Tax Transfer From Legal Entity

Objective

Companies that contract advertising agencies do not withhold IRRF on services contracted to promote its products. This value is paid by the agency, transferred to the contracting party and stated at DIRF.

DIRF - Withholding by tax authorities on services rendered by Advertising Agencies

Business Rule

The composition of the scenario described by the law above involves three roles:

• Contracting Company;
• Advertising Agency;
• Mass Media (Radio broadcasters, TV, Newspapers);

As analyzed by legal consulting, the services rendered by an advertising agency are subject to withholding when they are: market surveys, advertisement production, etc. The values paid to mass media are tax exempt, that is, the advertising agency receives them and transfers them to the media contracted.

Source: http://tdn.totvs.com/pages/releaseview.action?pageId=263783907

Example:

Organizations involved:

• Company X (contractor of advertising agency)
• Agency P (contracted)
• Broadcaster Z (channel contracted by Agency P to promote the brand of Company X)

Operations:

1. Company X contracted Agency P to promote its brand. 
2. Agency P has surveyed the market and produced adds for Broadcaster Z to run.
3. Broadcaster Z Actions
   1. Generate an invoice (outgoing document) to bill the value charged for running the adds of the Company X brand, listing Agency P as a customer. Value of promotion: 600,000.00
   2. Invoicing is tax exempt.

4. Agency P Actions

a.Post the incoming invoice from Broadcaster Z to pay the promotion of Company X, without withholding taxes and making the payment in accordance with the business contract they have mutually signed.

b. Issue the invoice (outgoing document) to bill Agency P, as shown below:Services Rendered: 100,000.00 Broadcaster Z transfer value: 600,000.00Invoice Total: 700,000.00

5. Upon issuing the invoice, Agency P becomes responsible for withholding the tax:IRF calculation basis: 100,000.00Income Tax Value: 1,500.00 – At this point a payment obligation must be generated to issue the DARF for the federal revenue service. This value will be declared in DCTF of Agency P. 

6. From the start of the year up to Jan 31, Agency P has to send Company X a document in the format below, with all IRF withholdings made during the previous Calendar Year:

7. Company X Actions

1. 1. Post the incoming invoice from Agency P to pay for services rendered and transfer the value charged by Broadcaster Z, without withholding taxes and making the payment in accordance with the business contract they have mutually signed.
   2. At the start of the year, upon receiving the YEARLY CERTIFICATE OF WITHHELD INCOME TAX, it will state it in the DIRF.

Technical Specifications

In the Financials Module, we have implemented an Income Tax Transfer register in which you can enter the CERTIFICATE OF WITHHELD INCOME TAX, sent by an advertising agency.

 
Tables:

FOM – Income Tax Transfer Data;
FON – Income Tax Transfer Details;
SRL - DIRF / Income Report; 
SR4 - DIRF / Income Report

Income Tax Transfer (FINA405)

Create a routine in MVC, based on tables FOM and FON, to p DIRF complementary register in accordance with the layout defined in Prototype 01.

Validations:

• FOM_IDDOC, cannot repeat;
• FOM_FORNEC, will use a standard query of supplier and trigger fields FOM_LOJA, FOM_RAZAO and FOM_CNPJ;
• FOM_CODRET, will use data from table 37 of SX5;
• Fields FON_IDDOC + FON_ ITEM, cannot repeat;
• Fields FOM_CHAVE and FON_CHAVE will be concealed from the user;

This allows deletion only of data not imported to DIRF (FON_DIRF = 2)

Consider the captions: 

• With items sent to DIRF. (at least one item with FON_DIRF = 2)
• Without items sent to DIRF. (all items with FON_DIRF = 1)

DIRF Data Complement Report (FINR405)

This report shows data registered in tables FOM and FON in accordance with the Prototype 2 layout, with the criteria below:

Search/Validation Criteria:

• Search all transactions with FOM_ANO equal to MV_PAR01;
• From Supplier/To Supplier, search supplier standard query; filter field FOM_FORNEC;
• From Store/To Store, filter FOM_LOJA;
• From/To Month: Search FON_MES months in the range entered by the user;
• If Select Branches is equal to 1 - it calls function AdmSelecFil to display the branches selection screen and filter transactions from tables FOM/FON with the branches selected; if equal to 2 - it only brings records from the current branch.
• If MV_PAR09 = 1, it brings records FOG_DIRF = 1, If MV_PAR09 = 2, it brings records FOG_DIRF = 2     

Generate data for DIRF (FINA401 and FINA403)

Create a function that will execute after DIRF generation, that seeks data from tables FOF and FOG in accordance with the parameters set by the user, and complements the recording of tables SRL and SR4.

 Search Criterion (ask FIN401):

•  Run a search only when MV_PAR04 = 2 (legal entity);
• Search all records from tables FOM and FON in which field FON_MES is in range MV_PAR02/MV_PAR03;
• If MV_PAR09 = 1(Yes), consider branches defined by the user; otherwise, only the current branch;
• If there is no recalculation, consider only records with field FON_DIRF = 2; otherwise, consider all.

  Validations:   

• Check whether FOM_CNPJ + FOM_CODRET exists in table SRL. If not, you must add it.
• Check whether FOM_CNPJ + FOM_CODRET + FOM_ANO + FON_MES is in table SR4. It must complement the recording of records; otherwise, you must add it; 
• If MV_PAR07 = 1(YES), after each addition or editing in table SR4, it must update the processing log.

SRL Addition Rule:

• RL_FILIAL = xFilial("SRL")
• RL_MAT= GetSxENum( "SRL" , "RL_MAT")
• RL_CODRET = FOM_CODRET
• RL_TIPOFJ  = A2_TIPO
• RL_CPFCGC  = FOM_CNPJ
• RL_BENEFIC = A2_NOME
• RL_ENDBENE = A2_END + A2_NR_END
• RL_UFBENEF = A2_EST
• RL_COMPLEM = A2_BAIRRO
• RL_CGCFONT = M0_CGC
• RL_NOMFONT = M0_NOMECOM
• RL_ORIGEM = "2"
• RL_CGCEX = A2_CGCEX
• RL_PAIS  = A2_PAISEX
• RL_NIFEX = A2_NIFEX

SR4 Addition Rule:

For each line of table FON, two lines are generated for an SR4, one to record the taxable income and another for the tax value withheld in the month.

Taxable Income Line: 

• R4_FILIAL  = xFilial("SR4")
• R4_MAT    = RL_MAT
• R4_CPFCGC = RL_CPFCGC
• R4_MES  = FON_MES
• R4_TIPOREN = "A"
• R4_CODRET  = FOM_CODRET
• R4_ANO  = FOM_ANO
• R4_VALOR  = FON_BASE
• R4_ORIGEM = "2"
• R4_PAIS = RL_PAIS
• R4_NIFEX  = RL_NIFEX

Withheld Tax Line: 

• R4_FILIAL  = xFilial("SR4")
• R4_MAT    = RL_MAT
• R4_CPFCGC = RL_CPFCGC
• R4_MES  = FON_MES
• R4_TIPOREN = "D"
• R4_CODRET  = FOM_CODRET
• R4_ANO  = FOM_ANO
• R4_VALOR  = FON_IMPREC
• R4_ORIGEM = "2"
• R4_PAIS = RL_PAIS
• R4_NIFEX  = RL_NIFEX

SR4 Complement Rule:

• R4_TIPO = A, field R4_VALOR is complemented with FON_BASE;
• R4_TIPO = D, field R4_VALOR is complemented with FON_IMPREC.

FON Recording Rule:

• The records processed field FON_DIRF = 1.

Screen Prototype

Complement register of DIRF – Prototype 01

Complement report of DIRF – Prototype 02


 
Process Flow

 
Advertising Agency


Contracting Company;