Deadline for micro-entrepreneurs to settle debts ends tomorrow

The deadline for individual microentrepreneurs (MEIs) to regularize the payment of taxes due since 2016 ends tomorrow (31) or longer. Starting in September, the Federal Revenue will send these debts for registration in Active Debt of the Union to avoid prescription.

According to the agency, MEIs that have only recent debts, due to the difficulties brought by the covid-19 pandemic, will not be affected. The debts of those who paid in installments this year will also not be registered, even if there is some installment in arrears or the installment payment has been terminated.

The micro-entrepreneur who has outstanding debts with the Federal Revenue can make the payment or installments by accessing the e-CAC Portal. The step-by-step information on installment payment is also available on Portal

According to the Revenue, there are 4.3 million defaulting micro-entrepreneurs, who owe R$ 5.5 billion to the government. This is equivalent to almost a third of the 12.4 million MEIs registered in the country. However, enrollment in the active debt is only valid for unpaid debts in excess of R$1,000, including the principal amount, fine, interest and other charges. Currently, Brazil has 1.8 million micro-entrepreneurs in this situation, who owe R$ 4.5 billion.

To help with regularization, the Federal Revenue Service provides the Accounting and Fiscal Support (NAF) centers, a partnership with higher education institutions that offers accounting and tax services to low-income individuals, MEI and civil society organizations.

During the pandemic, there are also nuclei operating remotely. The service locations and the respective contacts are available on the Internal Revenue Service page.

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Active debt

With a simplified taxation regime, MEIs only collect the contribution to Social Security and pay, depending on the field of activity, the Tax on the Circulation of Goods and Services (ICMS) or the Tax on Services (ISS). ICMS is paid to states and ISS to city halls.

In case of non-payment, the registration of the social security debt will be sent to the Attorney General of the National Treasury (PGFN) with an increase of 20% as charges for the process. In this case, the debts may be paid or paid in installments through the PGFN service portal, Regularize.

The debt related to ISS and/or ICMS will be transferred to the municipality or the state, as the case may be, for registration in municipal and/or state Overdue Debt, with additional charges in accordance with the legislation of each entity of the federation.

With the registration in active debt, the micro-entrepreneur is no longer insured by the National Institute of Social Security (INSS) and loses benefits such as sick pay and retirement; has the National Register of Legal Entities (CNPJ) canceled; is excluded from the Simples Nacional by the Federal Revenue, states and municipalities; and may have difficulties in obtaining financing and loans.