The Administrative Council of Tax Appeals (Carf) upheld, by a casting vote, the application of the 30% limitation for the offset of tax losses and negative CSLL (Social Contribution on Net Profit) basis in a company that was dissolved due to a merger.
The 30% limitation rule prevents companies from fully deducting their tax losses and negative CSLL bases when calculating Actual Profit, limiting the offset to 30% of net profit. The National Treasury appealed a decision that had exempted this limitation for the dissolved company by merger.
In Carf’s Superior Chamber, the prevailing understanding was that there is no legal basis to exclude the application of the 30% limitation in the last assessment period of the company to be merged, citing Supreme Federal Court (STF) decisions that considered the limitation constitutional in Extraordinary Appeals 344.994 and 545.308.
As a result, the case was referred back to the judging panel to decide on the legitimacy of applying fines, late payment interest, and monetary correction, which still needed to be discussed.
The dissenting vote argued that the STF’s decision did not directly apply to cases of company dissolution by merger. The councilors highlighted that the application of the limitation could, in some situations, lead to the taxation of the company’s assets.
Additionally, it was decided that the automatic fine would be excluded from the assessment, considering that the decision was made by a casting vote, as stipulated by Law 14.689/23.