- Brazil will implement a VAT system starting January 1, 2026.
- The system uses an “intelligent split payment” method to reduce VAT fraud and improve compliance.
- Payment service providers will split payments and verify if suppliers have VAT credits.
- If suppliers have enough credits, payment service providers will transfer the full amount.
- This aims to reduce cash flow issues and minimize VAT refund claims.
Source: vatcalc.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
