The complex web of tax obligations in the Brazilian business context poses significant challenges to many entrepreneurs. Under the country's legal guidelines, the provision of accounts by companies and legal entities is a strict requirement. Evasion of fines and penalties becomes imperative, therefore demanding strict compliance of operations such as Corporate Income Tax (IRPJ) and ancillary obligations with the regulations of the Federal Revenue Service.
In the challenging scenario of these tax demands, Digital Accounting Records (ECD) emerges as an essential component. This tool plays a crucial role, integrating itself in a vital way into the complex puzzle of Brazilian tax requirements. Its adoption is essential to ensure not only legal compliance, but also to enable effective management and transparency in the accounting practices of entities.
What is ECD?
Digital Accounting Records, or ECD, represents an advancement in the management of accounting documents. Established by Decree No. 6,022/2007 as part of the Public Digital Records System (SPED), ECD replaces paper records with a digital file sent online to the Federal Revenue Service. This transition provides agility, precision and greater control in accounting management.
The ECD covers accounting books such as the Journal, General Ledger, Daily Trial Balances, Balance Sheets and accounting entry forms. All of these records, which were previously physical and signed by an accountant, have been replaced by digital versions, including digital signatures. In short, the ECD is the file that taxpayers send to the tax authorities, containing all of the company's accounting records.
Mandatory ECD
All companies and legal entities, including those that are immune and exempt, classified under the taxation regimes of real profit, presumed profit or arbitrated profit, are required to carry out the ECD.
Who needs to submit the ECD in 2024
According to the legislation, the following are required to submit the ECD in 2024:
Legal entities taxed by Income Tax based on real profit.
Companies taxed on presumed profits, distributing profits or dividends above the permitted amount.
Immune and exempt legal entities subject to the presentation of the ECD of Contributions.
Limited Partnerships (SCP), as auxiliary books of the ostensive partner.
Who is exempt from filing in 2024?
On the other hand, some companies and legal entities are exempt from submitting the ECD in 2024, including those opting for the Simples Nacional, companies opting for the Presumed Profit adopting a cash book, public bodies, autarchies, public foundations, SCPs, inactive and immune legal entities without revenues exceeding R$4,800,000.00 from donations or incentives.
What needs to be included in the ECD in 2024
When preparing the ECD 2024, it is crucial to include mandatory accounting information and documents to avoid fines and penalties. Main elements to consider:
Diary and Ledger Books.
Daily balance sheets and other supporting documents.
Accounting Statements, such as Balance Sheet, Income Statement and Cash Flow Statement.
Tax Declarations and Additional Information.
Record of Accounting Events, detailing mergers, incorporations, spin-offs and relevant transactions.
Entity identification, with registration information for contextualization.
Deadlines for submitting the ECD in 2024
The ECD must be submitted by the last business day of June of the year following the accounting calendar. If the company undergoes special events, such as a spin-off, merger or incorporation, the Federal Revenue Service establishes specific deadlines.
Recent changes in ECD
Until 2023, the ECD was due on the last business day of May. However, the mobilization of the accounting profession resulted in an extension, which was maintained for 2024, making the deadline the last business day of June. This measure balanced the distribution of ancillary obligations throughout the year.
How to prepare and submit the ECD in 2024
To start the ECD 2024 process, follow these steps:
Download the ECD validator program from the official Federal Revenue website.
Consult the SPED portal to obtain the latest ECD manual and clarify doubts in the frequently asked questions section.
In the SPED ECD module, indicate the period, select the company, and advance to the generation and configuration steps.
Perform pre-validation, correcting possible errors to ensure file validation.
Once completed, access the chosen folder to save the file.
Source: Accounting Portal / Fenacon
