The instrument of the ‘split payment’ planned for 2027, to combat tax evasion and ensure more efficient collection, is one of the pillars of the tax reform, regulated this year. This mechanism will directly impact the cash flow of companies, requiring preparation to deal with the new reality.
In a simplified way, the ‘split payment’ is a system where taxes are segregated at the time of payment, going directly to the public coffers without passing through the company’s account. It means the end of delays in collection and the complexity of tax forms. It is a dream for the government and a logistical nightmare for those managing cash flow,” says tax lawyer Lucas Ribeiro, founder and CEO of ROIT, a leading company in solutions for Tax Reform.
In Ribeiro’s assessment, the ‘split payment’ puts the Treasury ‘in a position of co-owner of the companies’ cash flow’. He compares the change represented by the new instrument to that caused by the emergence of ‘Sped’ (Public Digital Bookkeeping System). ‘It is a change as drastic as that one. The difference is that now the impact is direct and daily.’
Impacts on Cash Flow
According to Ribeiro, companies that already face challenges balancing inflows and outflows, ‘split payment’ can raise a warning sign. The automatic segregation of taxes reduces the net amount available in the company’s account. And this is not just a technical change – it is a strategic change.
‘Imagine that, before, the tax remained ‘parked’ in the cash for a few weeks until the due date of the form. Now, it will be deducted instantly. The result? Less working capital and greater dependence on credit,’ details Ribeiro.
A crucial question: how to survive?
Companies that are already operating with tight margins need to rethink strategies now, recommends the tax lawyer. Renegotiating terms with suppliers, increasing operational efficiency, and optimizing costs will be essential to address this new reality. Moreover, the use of advanced technologies for financial and tax management will become mandatory.
“If a company does not master the data of its operation, ‘split payment’ can become an unsustainable burden. Tools like Invoice-To-Pay and cash flow simulators integrated with the ‘split’ are solutions that will help companies see the future before it becomes a problem,” advises Lucas Ribeiro.
Benefits and challenges
Although the promise of ending tax evasion is attractive – and positive for the country’s economic balance -, the challenges cannot be ignored. Ribeiro lists some of them:
Benefits
- Reduction of tax evasion and unfair competition.
- Simplification of tax collection.
- Greater tax predictability for governments and companies.
Challenges
- Reduction of immediate liquidity.
- Dependency on robust systems for real-time management.
- Need for higher working capital for companies with high tax volumes.
- Complex reconciliation between operations on a competency basis versus cash.
If ‘split payment’ is inevitable, preparation will be the game-changer. Companies that master the numbers, adjust their processes, and invest in advanced technology will take the lead, emphasizes the CEO of ROIT. ‘In the management war to come, those who have the data at hand will dictate the rules of the game. ‘Split payment’ is not the end, but the beginning of a new era in business management.’
Ribeiro adds: ‘So, the ultimate question remains: will your company have cash for ‘split payment’ or will it be dependent on loans and interest? The time to act is now. Those who wait for the storm are not prepared to sail.’
