In a previous article (which you can find here) I covered the essentials of eInvoicing in Mexico and the recent changes in government requirements. Today, the focus is going to be Brazil (part 3 will cover Argentina), which is largely considered the leader and pace setter for eInvoicing in Latin America.
Just to provide some background information. Around 2000 Brazil began an initiative to modernize tax and customs administration. It was called SPED – Sistema Público de Escrituração Digital (literally translates to digital system for public bookkeeping). It was created to standardize and computerize the relationship between the tax authorities and the tax payers. One of the initiatives that fell under SPED was electronic invoicing.
Electronic invoicing in Brazil is managed by the tax authority known as SEFAZ (Secretaria de Fazenda). Nota Fiscal Eletrônica” (NF-e) is the document that is submitted and stored electronically with the purpose of documenting a commercial transaction between buyers and sellers (i.e., the eInvoice). It is obligatory for nearly all enterprises in Brazil. The Nota Fiscal legislation covers not only physical goods (NF-e), but the law also covers service invoices (NFS-e) and logistic invoices (CTe).
Here is a quick overview of the process for sending a NF-e.
- The supplier generates an XML document that contains all the required information required for a NF-e. This document must have a digital signature and certificate in order to guarantee the integrity of the data and the identity of the sender. It is then sent to SEFAZ for registration and approval.
- SEFAZ reviews the NF-e and authorizes its use. Only after authorization is received can the goods be transported. The electronic file is the legal invoice.
- In order to transport the goods, a printed DANFE must accompany goods in transit for validation en route. DANFE stands for Document Auxiliary NF-e.
- eInvoice must be archived for 5 years by sender.
- eInvoice must be validated with SEFAZ by the buying organization.
Electronic Invoice for Services (NFS-e)
- Tax is assessed at the city level as opposed to the State level for the NF-e
- Service invoices can have multiple line items, but only one type of service per NFS.
- NFS number and Return Code provided by the City
- The appropriate city calculates the tax for you and does the validation
- Services can be delivered first and then invoiced later
- Invoices are archive for 5 years by city
Lastly, just like NF-e, CT-e is a digital document issued and stored electronically. Its purpose is to document the rendering of logistics/transportation services. The validity of this document is guaranteed by the digital signature of the issuer and the authorization of the appropriate state’s tax authority.
Coming shortly, Part3: Argentina
