Understand the zero litigation program!

Having outstanding debts with the Federal Government can be a major problem for the Government and for the taxpayer — whether an individual or a legal entity. To deal with the situation, the Zero Litigation program was created, which offers special conditions for paying off debts.

This avoids the need for legal disputes, benefiting both the government and debtors. It is therefore worth learning more about the initiative, the conditions for participating and the ways in which debts can be settled.

In this article, you will see the main information about the Government’s Zero Litigation program. Keep reading to find out!

What is Zero Litigation?

Zero Litigation is a program created by the Federal Government to facilitate the resolution of tax disputes between taxpayers and the tax authorities. It was launched with the aim of reducing the number of lawsuits related to tax issues .

Thus, the program offers the opportunity to negotiate more favorable terms for individuals and legal entities with debts in administrative proceedings with the Federal Revenue Service. Taxpayers avoid lengthy legal disputes and have more flexibility to regularize their tax situation.

Some of the benefits that can be offered in the negotiation are the reduction of interest, fines and legal charges. This possibility is granted to credits classified as irrecoverable or difficult to recover.

Who can participate?

Now that you know what the Zero Litigation program is, you should be aware of the rules for participation, since not all debts are eligible for renegotiation. In 2023, the proposal covered debts of up to 60 minimum wages.

In the 2024 edition, the Government has set a ceiling for the debt — R$50 million. Therefore, check the State’s definition before registering. Registrations for this phase took place between April 1st and July 31st and required express authorization for the application of the Electronic Tax Domicile (DTE).

Debts covered by the Zero Litigation program are classified according to the chance of payment. Check out how they can be considered:

  • irrecoverable;
  • difficult to recover;
  • with average recovery prospects;
  • with a high prospect of recovery.

The procedure could be done through the e-CAC Portal, accessed with the Gov.br account. There, the taxpayer checks active debts and payment conditions. In the 2024 edition, the Federal Government allowed debt installments in 12, 24, 36, 55 and 115 months.

Furthermore, cases classified as having a high and medium chance of settlement had the possibility of paying a deposit to reduce the number of installments. It is worth noting that the minimum installment depended on the taxpayer’s profile.

In 2024, the distribution was as follows:

  • individual: R$ 100;
  • micro and small businesses: R$300;
  • large company: R$500.

What are the advantages of participating in the Zero Litigation program?

As you have seen, the Zero Litigation program aims to make taxpayers’ lives easier by offering more flexible conditions for paying off debts. In this way, participation is advantageous because it avoids legal costs — which tend to be high for everyone involved.

Disputes in this area are also often time-consuming and exhausting. Furthermore, the program allows for the rapid resolution of tax disputes through a virtual process. As a result, individuals and companies have greater legal certainty and financial predictability.

Additionally, it is worth highlighting, among the benefits of joining Zero Litigation, the possibility of reducing or even eliminating fines, interest and other costs linked to debts. The advantage is associated with installment payments, with extended terms.

Payment is tailored to each taxpayer profile, respecting their ability to pay the installments. This feature makes tax regularization more accessible and less costly.

What are the benefits for the Government?

You have learned that Zero Litigation is advantageous for taxpayers who renegotiate their debts with the Federal Revenue Service. But the Government can also count on some benefits.

The first is the reduction of ongoing legal proceedings by reducing the burden on the Judiciary, favoring more efficient management of public resources. Just as for taxpayers, legal proceedings are costly and time-consuming for the Government.

Therefore, it is not in the best interest of either party to keep the outstanding debts. Regularizing debts also represents an increase in revenue, helping to balance public accounts.

Finally, the reduction in the number of disputes driven by the program contributes to administrative efficiency. In this way, the tax administration can focus on other relevant areas, improving tax management.

How does dispute resolution in business encourage investment?

So far, you have understood what the Zero Litigation program is and what its rules are. So it is worth checking out how dispute resolution improves the business environment and encourages investment, since tax regularization plays an important role for companies.

Many commercial transactions, especially those involving the public sector, require the presentation of certificates of no outstanding debts. Pending issues with the IRS may prevent the documents from being obtained, making it impossible to participate in public tenders and sign contracts with the Government.

Furthermore, tax debts can lead to legal proceedings, which result in the seizure of assets and rights, including those of company partners. This situation creates an environment of insecurity and instability, affecting investor confidence.

Thus, by joining the Zero Litigation Program, companies have the chance to avoid these consequences and reduce liabilities related to fines and interest. As a result, they benefit business continuity and growth.

Furthermore, the reduced need for resources to settle outstanding debts due to the discounts offered provides companies with greater financial margin to invest in other activities.

As you can see, the Zero Litigation program offers the possibility of paying off debts with the Federal Revenue Service easily and at a reduced cost. In this sense, it is important to understand how it works and the requirements for joining.

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