Simplified Individual Tax Settlement (Transação Tributária): Efficiency, Legal Certainty, and Strategy in Managing Tax Liabilities

From tax contingency to business decision Tax settlement (transação tributária, a negotiated settlement mechanism between taxpayers and the Brazilian tax authorities) has established itself as one of the most relevant instruments for companies that need to manage tax liabilities without treating regularization as a mere collection issue. In the Brazilian business environment, where tax disputes can drag on for years and compromise tax clearance certificates, credit access, investments, and corporate transactions, the possibility of building a consensual solution with the Tax Administration has come to have a direct impact on cash flow, governance, and financial planning. The logic is no longer simply to pay or to litigate. In certain situations, it has become possible to negotiate within legal parameters, with reciprocal concessions, preservation of economic activity, and reduced litigation.

A regime that has matured and become more segmented The legal basis lies in Article 171 of the National Tax Code (Código Tributário Nacional) and in Law No. 13,988/2020, later expanded by Law No. 14,375/2022. This set of rules authorized the federal government to enter into settlements to resolve disputes and collect tax credits under conditions defined by law and regulation. Subsequent developments created a more sophisticated system, in which the applicable modality depends on the stage the credit is in, the amount involved, the debtor's payment capacity, the degree of recoverability, and the existence of administrative or judicial litigation. For this reason, discussing tax settlement today requires distinguishing between what is under the management of the Federal Revenue Service (Receita Federal) and what has already been registered as active debt (dívida ativa) and transferred to the jurisdiction of the Attorney General's Office for the National Treasury (Procuradoria Geral da Fazenda Nacional, PGFN).

Federal Revenue Service: simplification reaches administrative litigation Within the Federal Revenue Service, Ordinance RFB No. 555/2025 reformulated the rules governing settlement of credits under administrative tax litigation. One of the most relevant points for companies was the reduction of the minimum amount for the ordinary individual settlement, which, as a rule, now applies to credits exceeding R$ 5 million, while the simplified individual settlement became intended for credits equal to or greater than R$ 1 million and less than R$ 5 million. This change expanded the room for individual negotiation for liabilities that previously might have fallen outside a customized solution or depended exclusively on public settlement notices (editais de adesão).

The simplified modality does not mean automatic approval. The company submits a proposal with a payment plan, down payment, term, installment conditions, requested discount based on its payment capacity, indication of assets and rights that may serve as collateral, and supporting documentation. The Revenue Service reviews the requirements and may accept the proposal, make a counterproposal, or reject it. In business terms, this brings the settlement close to a structured liability reorganization process, in which the quality of financial information and the consistency between the proposal, projected cash flow, and actual net worth can be as important as the legal argument being discussed in the administrative proceeding.

PGFN: active debt, payment capacity, and recoverability When the debt has been registered as federal active debt (dívida ativa), negotiation is conducted by the PGFN, under Law No. 13,988/2020 and Ordinance PGFN No. 6,757/2022, as well as specific notices and acts. The simplified individual settlement remains available as a negotiation channel through the Regularize platform in the regulated scenarios, while settlement-by-adhesion programs offer standardized conditions for groups of taxpayers and credits. In August 2026, for example, Public Notice PGDAU No. 6/2026 includes modalities linked to payment capacity, hard-to-recover credits, small-value debts, and secured registrations, with adhesion available until September 30, 2026, and specific limits for each scenario.

The practical difference matters. In active debt cases, the Administration considers the degree of recoverability of the credit and the debtor's payment capacity to calibrate benefits and structure conditions. The legal objective is not to grant a generic discount, but to increase recovery of public credit in a manner compatible with the taxpayer's economic situation. For companies, this requires understanding how tax, accounting, asset, and financial data influence the classification adopted by the tax authorities. A payment capacity estimated in a manner incompatible with the actual situation can significantly change the available proposal and, where applicable, justify a duly substantiated request for review.

Reciprocal concessions do not mean automatic benefits Tax settlement should be understood as a public-law legal transaction, conditioned on legality and public interest. Law No. 13,988/2020 allows for concessions, including discounts on fines, interest, and charges in certain modalities, differentiated deadlines, and the use of collateral instruments, but it also imposes limits and prohibitions. Taxpayers do not have an unrestricted right to the largest discount or the longest term. Negotiation depends on the criteria of the modality, the nature of the credit, and the information presented. For this reason, business decisions based solely on maximum percentages disclosed in public notices may create mistaken expectations and unreliable cash flow projections.

The use of tax loss carryforward credits (prejuízo fiscal) and negative CSLL calculation base credits also deserves attention. The legislation allows their use in specific scenarios, but acceptance is conditioned on the rules of the modality and verification by the Tax Administration. At the Federal Revenue Service, Ordinance RFB No. 555/2025 reinforced the exceptional nature of this mechanism within individual settlements. In governance terms, companies should treat these credits as assets subject to legal and accounting validation, not as automatically available settlement currency. The documentation of origin, the regularity of the calculation, and adherence to the terms of the agreement must be assessed before incorporating the benefit into the financial model of the transaction.

Governance, waivers, and the risk of rescission The economic benefit must be analyzed together with the obligations assumed. The settlement may require acknowledgment of the debts, withdrawal of objections and appeals, waiver of legal claims related to the included credits, maintenance of tax compliance, and fulfillment of future obligations. In certain modalities, debts that become due after formalization must be regularized within the regulatory deadline. For corporate groups, this means that the decision to settle does not belong solely to the tax department. It may require the involvement of the finance department, controllership, litigation counsel, internal audit, and, depending on materiality, governance bodies responsible for approving material impacts.

Rescission of the agreement is another risk that should not be underestimated. Failure to pay installments, violation of assumed obligations, provision of incorrect information, asset-stripping acts, or other legal and regulatory grounds may unravel the settlement and reinstate collection under the conditions set forth by law. For this reason, companies should stress-test the sustainability of the agreement under cash-flow pressure scenarios, taking into account seasonality, bank debt, planned investments, and parallel contingencies. A settlement that is formally advantageous may become economically inadequate if the payment structure is not compatible with actual cash generation.

Case law: legal certainty also limits the tax authorities' demands Recent case law from the Superior Court of Justice (Superior Tribunal de Justiça, STJ) reinforced an important point regarding the predictability of these agreements. In Special Appeal (REsp) 2,032,814/RS, judged by the First Panel in June 2025, the STJ held that the Public Treasury could not demand attorney's fees based on Article 90 of the Code of Civil Procedure when such a charge was not provided for in the legislation establishing the terms of the settlement. The Court emphasized legal certainty, the good faith of the taxpayer, and the protection of legitimate trust, recognizing that the terms of a tax settlement must derive from the specific legal framework governing it.

This precedent does not turn the settlement into a contract freely negotiated between parties in an equivalent position. On the contrary, it confirms that the institute remains subject to public-law rules and conditions previously authorized by law. Its business relevance lies in another dimension: the Administration must also respect the regulatory limits of the program it offers. This increases the importance of carefully reviewing the public notice, the ordinance, the settlement instrument, and any ancillary requirements before adhering, especially where there are implications for judicial proceedings, collateral, attorney's fees, deposits, or the accounting recognition of contingencies.

Regulatory trend: more negotiation, more data, and more responsibility The trend observed between 2020 and 2026 is one of expanding tax consensuality, with greater segmentation of modalities and growing use of data to assess payment capacity and recoverability. The public notices issued in 2026 by the Federal Revenue Service and the PGFN confirm that settlement has become a permanent policy for managing litigation and credits, rather than merely an emergency measure. For companies, this evolution creates opportunities but also raises the standard of preparation required. Sustainable proposals depend on reliable information, consistent documentation, and integration between tax strategy and financial planning.

This movement also changes the way litigation is managed. A tax dispute should not be monitored solely based on the likelihood of legal success. Management needs to compare the expected economic value of the dispute with the financial cost of maintaining the liability, the probable duration of the proceeding, the impact on collateral, the possibility of settlement, and the effects on tax clearance certificates and corporate transactions. In certain situations, continuing to litigate may be rational. In others, settlement may reduce uncertainty and free up managerial and financial capacity. The key point is that the choice should result from comparative, documented analysis aligned with business objectives.

Settling requires strategy, not just discount calculations The simplified individual tax settlement represents a significant advance in the relationship between the tax authorities and taxpayers, as it creates a solution better suited to the reality of certain liabilities without eliminating the legal rigor involved in the use of public resources. For business owners and managers, its greatest contribution may be enabling tax regularization to be treated as a capital allocation and risk management decision, with simultaneous assessment of cash flow, collateral, contingencies, governance, and operational continuity.

Before adhering to a program or submitting a proposal, it is advisable to map the stage of each credit, identify the competent authority, review payment capacity, estimate the total cost of the agreement, and compare this scenario against defense and financing alternatives. Preventive legal advice, integrated with accounting and financial analysis, can help the company understand the commitments being assumed and choose a structure compatible with its strategy, always within the legal limits applicable to the specific case.