Tax Credit Compensation in Brazil: 5-Year Deadline Set by STJ

If your company won a tax refund lawsuit in Brazil, be aware: the STJ ruled that the full tax credit compensation must be completed within five years. Missing the deadline can result in the loss of your judicial tax credit.

What the STJ says about tax credit compensation

Brazil’s Superior Court of Justice (STJ) has revised its interpretation: tax credit compensation in Brazil must be both started and fully executed within five years after the final court ruling (transit in judgment).

This means that even if you began the process, you can lose tax credits if you don’t finish it within this 5-year deadline.

Why Brazilian tax planning matters

If your company has large amounts of PIS or COFINS refunds or any judicially recognized tax credits in Brazil, it’s vital to have proper Brazilian tax planning. Delaying compensation can lead to expiration and financial loss.

Losing tax credits due to expired deadlines

The tax refund deadline in Brazil is real — and now enforced. The STJ tax decision makes it clear: failing to act on time can result in lost tax credits.

What you should do

✅ Talk to a Brazilian tax attorney.

✅ Check the status of your tax refund requests.

✅ Make sure all your tax credit compensations are filed on time.