STJ Limits Taxpayer’s Deadline to Offset Tax Credits to 5 Years

When judging REsp 2.178.201-RJ, the Second Panel of the Superior Court of Justice (STJ) issued a ruling according to which the taxpayer has a prescriptive period of 5 years, counting from the court decision, to use tax credits through offsetting.

This is a new approach to art. 1 of Decree No. 20,910/1932, which establishes a prescriptive period of 5 years from the date of the act or fact that gives rise to debt against the Union, States or Municipalities.

Based on this new interpretation, the Superior Court of Justice (STJ) ruled that the statute of limitations, which begins upon the final judgment of the court decision, must be respected for each PER/DCOMP transfer, which constitutes the act through which the taxpayer materializes the recovery of the undue payment. In other words, after the five-year period, the taxpayer will no longer be able to enforce the recovery of the undue payment.

This can have a significant impact on the use of tax credits obtained by taxpayers through court decisions, especially because compensation depends directly on the existence of tax to be collected through this method.