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RECOVERABLE TAXES
 9 Months Ended
Sep. 30, 2021
Recoverable Taxes  
RECOVERABLE TAXES

9.RECOVERABLE TAXES

 

The rollforward of recoverable taxes are set forth below:

                                     
    Note   12.31.20   Business combination (note 1.2)   Additions   Compensations / Reversals   Transfers (1)   Interest   Exchange variation   09.30.21
ICMS and VAT                                    
Recoverable ICMS and VAT        1,568,975   7,523   425,762   (108,947)    (134,393)   180   (2,621)    1,756,479
(-) Impairment       (154,721)    -    (23,020)   28,557   17,104   -     -    (132,080)
PIS and COFINS   9.1                                
Recoverable PIS and COFINS        3,168,099   35,268   371,314   (888,864)    -     56,881    -     2,742,698
(-) Impairment       (14,228)    -     -    -     -    -     -    (14,228)
IPI   9.2                                
Recoverable IPI       808,528   1,149   5,368    (460)    -     76,526    -    891,111
(-) Impairment       (1,984)    -     -    -     -    -     -    (1,984)
INSS                                    
Recoverable INSS       341,825   12   13,955   (56,356)    -     3,800    -    303,236
(-) Impairment        (102)    -     -    -     -    -     -     (102)
Other                                    
Other recoverable taxes        52,889   3,995   28,768   (1,408)    -    -     (34)    84,210
(-) Impairment       (1,963)    -     -    20    -    -     -    (1,943)
Total        5,767,318   47,947   822,147   (1,027,458)    (117,289)    137,387   (2,655)    5,627,397
                                     
Current       899,120                           883,740
Non-current        4,868,198                            4,743,657
                                     
        12.31.20   Business combination   Additions   Compensations / Reversals   Transfers (1)   Interest   Exchange variation   09.30.21
Income taxes                                    
Recoverable income taxes       107,728   922   69,015   (13,634)    -    135    (337)   163,829
(-) Impairment       (9,029)    -     -    -     -    -     -    (9,029)
Total        98,699   922   69,015   (13,634)    -    135    (337)   154,800
                                     
Current        43,840                            94,936
Non-current        54,859                            59,864

 

(1)The transfers occur from Recoverable Taxes to Other Current Assets and Other Non-Current Assets when sales of credits are made to third parties.

  

 

                                 
                                   
    Note   12.31.19   Additions   Compensations   Transfers (1)   Restatement   Exchange variation   12.31.20
ICMS and VAT   9.1                            
Recoverable ICMS and VAT         1,635,663     570,056   (549,446)   (127,370)     240   39,832     1,568,975
(-) Impairment       (141,193)     (38,033)     3,022   21,483    -    -   (154,721)
PIS and COFINS   9.2                            
Recoverable PIS and COFINS         2,990,313     729,213   (594,483)    -   43,056    -     3,168,099
(-) Impairment         (16,922)    -     2,694    -    -    -     (14,228)
IPI   9.3                            
Recoverable IPI         848,865     2,319    (7,201)     (92,812)   57,357    -     808,528
(-) Impairment        (3,818)    (263)     2,097    -    -    -    (1,984)
INSS                                
Recoverable INSS         255,967   88,621    (7,663)    -     4,893   7     341,825
(-) Impairment        (102)    -    -    -    -    -    (102)
Other taxes                                
Other recoverable taxes       80,145   11,952    (901)     (38,277)    -     (30)   52,889
(-) Impairment        (5,639)    -     3,676    -    -    -    (1,963)
Total         5,643,279     1,363,865   (1,148,205)   (236,976)     105,546   39,809     5,767,318
                                 
Current         473,732                         899,120
Non-current         5,169,547                         4,868,198
                                 
    Note   12.31.19   Additions   Compensations   Transfers (1)   Restatement   Exchange variation   12.31.20
Income taxes   9.4                            
Recoverable income taxes         430,778   58,007   (422,496)    -     4,341   37,098     107,728
(-) Impairment        (9,029)    -    -    -    -    -    (9,029)
Total         421,749   58,007   (422,496)    -     4,341   37,098   98,699
                                 
Current         152,486                       43,840
Non-current         269,263                       54,859

 

(1)The transfers occur from Recoverable Taxes to Other Current Assets and Other Non-Current Assets when sales of credits are made to third parties.

 

9.1.PIS and COFINS –Social Integration Plan and Contribution for Social Security Financing

On December 7, 2020 and July 13, 2021, the processes filed by Batávia S.A. (subsidiary incorporated by BRF S.A.) and UP! Alimentos Ltda. (an entity jointly controlled by BRF S.A., whose operations were closed), respectively, granting the Company the right to exclude ICMS from the PIS and COFINS calculation basis. The Company, supported by its consultants, obtained the fiscal files for the period and reconciled them with the accessory obligations, measuring the credits reliably through the ICMS presented in the invoices. Thus, the amount of R$90,935 was recognized under Recoverable PIS and COFINS, being R$40,501 of principal recorded in Other Operating Income and R$50,434 of interests recorded in Financial Income.

As of September 30, 2021, the updated balance of the processes related to the exclusion of the ICMS from the PIS and COFINS calculation basis recognized by the Company is R$2,396,028 (R$2,818,391 as of December 31, 2020). The amount of R$554,287 related do these credits was offset against other federal taxes in the nine-month period ended on September 30, 2021 (null in the same period of the previous year). 

In the study prepared by the Management, its realization is estimated through offsetting with federal taxes or through reimbursement of the amounts as expected below:

  PIS and COFINS
Current  499,000
Non-current 1,897,028
October to december 2022  327,516
2023  537,000
2024  672,000
2025  360,512
Total 2,396,028

 

9.2.IPI - Industrialized Product Tax

The Company recognized relevant tax assets as result of gains from lawsuits related to IPI, specially “crédito prêmio”. The balance referring to these assets on September 30, 2021 is R$938,824 (R$860,820 on December 31, 2020), of which R$881,527 (R$805,001 on December 31, 2020) is recorded as Recoverable Taxes and the remainder, referring to cases in which the government will reimburse in cash, is recorded as Other Current Assets, in the amount of R$40,370 (the same amount on December 31, 2020) and as Other Non-Current Assets, in the amount of R$16,927 (R$15,449 on December 31, 2020).

 

 

According to projections prepared by the Management, its realization is estimated through the refund of the amounts as expected below:

  IPI
Current  40,370
Non-current  898,454
October to december 2022  16,927
2025  647,252
2026  234,275
Total  938,824

 

9.3.Realization of Brazilian federal tax credits

The Company received in cash, through court orders related to IPI credits, the amount of R$1,368 in the nine-month period ended on September 30, 2021 (R$235,405 in the same period of the previous year).

The Company used PIS, COFINS, IPI, IRPJ, CSLL, INSS and other tax credits to offset federal taxes payable such as INSS and Income Taxes in the amount of R$944,853 in the nine-month period ended September 30, 2021 (R$694,206 in the same period of the previous year), preserving its liquidity and optimizing its capital structure.