Brazil Sets New Rules for the Simplified Tax Regime (Simples Nacional) and IBS/CBS Options for 2027.

Brazil’s CGSN Resolution No. 186/2026 sets new deadlines for opting into Simples Nacional for 2027 and introduces flexibility for companies to choose the regular IBS/CBS tax regime, allowing separate tax payments and input tax credits. The changes, part of Brazil’s broader tax reform, require businesses to reassess their tax strategy and prepare systems for a transitional period in 2027, especially to remain competitive in B2B transactions.

A new regulation (CGSN Resolution No. 186/2026) introduces important deadlines and options for companies under Brazil’s simplified tax regime (Simples Nacional), especially in light of the upcoming tax reform.

Deadlines:

-       Opting for Simples Nacional (2027):

·         Period: September 1–30, 2026,

·         Effective from: January 1, 2027,

-       Fixing rejected applications:

·         Companies have 30 days to resolve issues (e.g., tax debts).

-       Cancelling the option:

·         Possible until November 30, 2026 (after that, final)

From 2027, companies in Simples Nacional can choose to calculate IBS and CBS taxes under the regular regime instead of the simplified system.

What this means:

-       Taxes (IBS/CBS) are paid separately, not within Simples.

-       Companies can generate tax credits on purchases,

-       Makes businesses more competitive in B2B transactions.

When is this beneficial:

-       Useful for companies selling to other businesses,

-       Allows issuing invoices with full tax credits, unlike Simples.

Special rule for 2027:

-       The IBS/CBS regular regime option is valid only for:

·         January–June 2027 (transition period).

Start-ups (Late 2026):

-       Companies opened between October–December 2026:

·         Choose regime at registration,

·         Simples applies for full 2027,

·         IBS/CBS option applies only for first half of 2027.

Exceptions:

-       Individual entrepreneurs (MEIs) are not affected by these rules.

Brazil is aligning tax regimes with its broader reform:

-       Earlier deadlines,

-       More flexibility in choosing tax treatment,

-       Strong focus on transition to IBS and CBS, which will replace current taxes.

Businesses should prepare early, review their tax strategy, and ensure systems can handle the new requirements.