Tax Compliance as Prevention of Abusive Evasion in Simples Nacional

César Augusto Gelli Silva; Elizeu Bandeira De Lima

DOI: 10.22167/2675-6528-202602771

Article derived from a Final Course Work (TCC), with content based on the student’s original work and adapted to the editorial format of the E&S Magazine with the support of the ResumeAI tool, an artificial intelligence solution developed by the Pecege Institute for textual synthesis and organization.

Abstract

The distinction between lawful and abusive tax avoidance represents a challenge for companies and tax administration, especially in the Simples Nacional. The effectiveness of tax compliance as an instrument for mitigating the risk of characterization of abusive avoidance in business splitting structures within the Simples Nacional was analyzed, in light of the jurisprudential criteria of the CARF. The methodology was qualitative and descriptive, based on bibliographic and documentary review, with analysis of decisions from CARF, STJ, and STF. A simulated case study was conducted to apply the jurisprudential criteria. The results indicated that the absence of tax compliance mechanisms in a simulated case of business splitting resulted in a high risk of characterization of abusive avoidance, according to the jurisprudential criteria of the CARF. The application of compliance demonstrated its capacity to reduce tax risks and promote conformity. It was concluded that tax compliance is a central instrument of preventive governance, essential for the sustainability of tax optimization strategies, and not a substitute for planning. A tax risk matrix and a tax compliance checklist were developed as support tools.

Keywords: Tax compliance; Abusive avoidance; Tax avoidance; Corporate governance; Tax planning.

1. Introduction

The high tax burden in Brazil drives companies of various sizes to adopt tax planning strategies as a legitimate means of economic and financial optimization. The Simples Nacional, a simplified tax regime, currently has approximately six million two hundred thousand opting companies throughout the country (Receita Federal do Brasil, 2026). This data highlights the economic magnitude of the regime and the practical relevance of understanding the boundaries between legitimate tax planning and artificial structures aimed at remaining in this favored regime, whose annual revenue ceiling is set at four million eight hundred thousand reais (LC nº 123/2006).

However, the line separating lawful tax avoidance from practices considered abusive is thin, especially in operations involving corporate reorganizations aimed at reducing taxes. One of the most recurring and debated cases in administrative jurisprudence is the artificial fragmentation of companies to remain within the Simples Nacional regime. This practice, when carried out fraudulently, constitutes abuse and can result in tax assessments, retroactive collection of taxes, and exclusion from the simplified regime. This boundary between legitimate tax planning and abusive avoidance constitutes a challenge for both the taxpayer and the tax administration.

In this scenario, tax compliance emerges as a strategic and preventive instrument, aimed at identifying, documenting, and correcting conduct that may violate tax legislation or expose the company to administrative and judicial sanctions. The adoption of governance mechanisms capable of mitigating risks and ensuring legal and ethical compliance is essential. From the perspective of agency theory (Jensen & Meckling, 1976), compliance acts as an alignment mechanism between managers and stakeholders, reducing informational asymmetry and mitigating risks of opportunistic behavior in the fiscal field.

The absence of structured documentation of tax decisions creates an informational asymmetry unfavorable to the taxpayer who, when faced with an audit, does not have sufficient evidence to demonstrate the economic substance of their operations (Healy & Palepu, 2001). By adequately documenting the business purpose and adopting consistent internal controls, the company reduces this asymmetry and decreases the margin of subjectivity in the interpretation of its operations by the Federal Revenue Service and the Administrative Council of Tax Appeals (CARF). The adoption of a structured compliance system allows for the strengthening of corporate governance, the traceability of tax decisions, and transparency in fiscal management, promoting legal certainty and business sustainability (IBGC, 2023). The COSO (2013) framework and the OECD (2020) compliance guidelines provide the structure for operationalizing these principles.

Given this context, the need for mechanisms that ensure compliance and ethics in tax strategies is pressing. The research problem that guides this study can be formulated in the following terms: to what extent does the adoption of structured tax compliance mechanisms, based on criteria of economic substance, governance, and internal control, reduce the risk of characterization of abusive tax avoidance in business splitting structures within Simples Nacional, according to the decision-making parameters of CARF? Thus, the general objective of this work is to analyze the effectiveness of tax compliance as an instrument for mitigating the risk of characterization of abusive tax avoidance in business splitting structures within Simples Nacional, in light of the jurisprudential criteria of CARF.

2. Material and Methods

The research adopted a qualitative and descriptive approach, based on the case study method. The central objective was to understand how the presence or absence of tax compliance mechanisms influences the risk of characterizing abusive tax avoidance, based on the objective criteria consolidated in the jurisprudence of the Administrative Council for Tax Appeals (CARF). A structured practical application was carried out, using a simulated tax planning situation in a fictitious economic group to demonstrate the relevance of compliance.

Data collection was carried out indirectly, through bibliographic and documentary research. Specialized doctrines, scientific articles, pertinent legislation, opinions from the Federal Revenue Service, rulings from CARF, and judgments from the Superior Court of Justice (STJ) and the Supreme Federal Court (STF) were used as sources. These documents were selected for their relevance to the theme of tax avoidance and tax planning, providing the empirical and conceptual support necessary for the study.

The temporal scope of the research covered decisions issued by the CARF, the STJ, and the STF between the years 2011 and 2022. This period was chosen because it encompasses the consolidation of administrative jurisprudence on corporate fragmentation and relevant legislative milestones, such as Complementary Law No. 147/2014 and the judgment of ADI 2.446 by the STF in 2022. The selection of the judgments analyzed followed three criteria: direct thematic relevance to corporate fragmentation in Simples Nacional; express reasoning on elements of simulation, such as partner identity, asset commingling, lack of business purpose, managerial unity, and economic substance; and availability of access to the full text of the decisions in the official databases consulted. It was noted that the CARF’s public jurisprudence consultation platform (SINCON) did not allow for integrated textual search or systematic export, which required a manual review of the rulings.

The qualitative data analysis was conducted using the content analysis technique, as proposed by Bardin (2011). The decision criteria of CARF were categorized into previously defined analytical dimensions, which allowed for the identification of recurring interpretive patterns in the administrative decisions examined. The COSO internal control model (2013) and the OECD compliance guidelines (2020) provided the conceptual framework for evaluating the effectiveness of the compliance mechanisms applied to the simulated case.

The use of a simulated case was justified by the impossibility of accessing sensitive business data, with the fictitious structure being built based on recurring patterns identified in CARF jurisprudence. The simulated case represented a hypothetical business structure, named Grupo Econômico Família Silva, composed of multiple legal entities formally distinct, but with indications of operational integration. This simulated case study allowed for the practical application of jurisprudential criteria and the assessment of the risk of abusive avoidance. As it did not involve sensitive data or the identification of real companies, the research did not require submission to the Ethics Committee.

The analysis protocol followed three sequential steps. Firstly, jurisprudential criteria were identified in CARF decisions related to business fragmentation in Simples Nacional. Subsequently, risk elements were categorized into specific analytical dimensions, which included economic substance, operational autonomy, and corporate identity. Finally, these criteria were applied to the simulated case, with the classification of the risk level through a structured matrix. A self-authored proposal for a tax compliance checklist was also developed to systematize the jurisprudential criteria and assist in the preventive assessment of fiscal risks.

As a methodological limitation, the simulated nature of the case study stands out, which restricts the generalization of results to real situations, although it preserves analytical validity within the scope of the proposed objective. Additionally, the research did not cover judicial decisions in the scope of judicial review of administrative acts, focusing primarily on CARF jurisprudence. Finally, the jurisprudential sample analyzed, although selected by explicit criteria of thematic relevance and reasoning, did not exhaust all CARF decisions on the subject, due to the limitation of systematic access to the public database of administrative jurisprudence.

3. Results and Discussion

The analysis of the collected data, originating from a bibliographic and documentary review, with special attention to the decisions of the Administrative Council for Tax Appeals (CARF), revealed a consistent decision-making pattern. This pattern indicates the disregard of corporate structures that, although formally valid, lack economic substance or a legitimate business purpose. In situations of corporate fragmentation intended to remain in the Simples Nacional (National Simplified Tax Regime), CARF prioritizes the verification of operational autonomy, administrative independence, and the effective segregation of activities among the legal entities involved. The mere formal division of companies, devoid of a real separation of management, organizational structure, and economic purpose, is often characterized as simulation, resulting in the exclusion from the favored tax regime and consequent tax assessment. Such understanding is in line with Article 116, sole paragraph, of the National Tax Code, which allows for the disregard of legal acts aimed at dissimulating the tax-generating event.

The analyzed elements suggest that the distinction between lawful tax avoidance and abusive tax avoidance transcends the mere analysis of the legal form adopted by the taxpayer, depending crucially on the verification of the economic substance of the operations. A tax plan is considered legitimate when supported by an effective business purpose, and it is subject to disregard if identified as an artificial instrument solely aimed at reducing the tax burden. This perspective reinforces the need for companies to demonstrate the real economic motivation behind their corporate structures, going beyond mere legal formality to avoid challenges from the tax administration and the CARF.

The Simulated Case Study: Silva Family Economic Group

Based on the identified jurisprudential parameters, a simulated case study was developed, representing a hypothetical business structure named Grupo Econômico Família Silva. This group was composed of three legally distinct entities, but with significant indications of operational integration. In the proposed scenario, the companies Alpha Comércio Ltda., Beta Serviços Ltda., and Gamma Importações Ltda. shared the same shareholder structure, administrative structure, address, and human resources. Furthermore, they performed interdependent economic activities, which raised serious questions about the effective autonomy between them, a crucial factor in the CARF’s assessment of abusive avoidance.

The three entities were established in a short period of time: Alpha Comércio Ltda. in 2016, Beta Serviços Ltda. in 2019, and Gamma Importações Ltda. in 2021. This temporal pattern, according to CARF criteria, reinforces the indication of an artificial decentralization motivated by the proximity to the revenue sub-limit of Simples Nacional, and not by organic business expansion reasons. Alpha Comércio Ltda. had the sale of computer products as its corporate purpose, with an annual revenue of R$ 3.2 million. Beta Serviços Ltda. operated with IT support services, generating R$ 1.1 million per year. Gamma Importações Ltda., on the other hand, was dedicated to import and distribution in the same segment, with an annual revenue of R$ 0.9 million. All companies were participants in Simples Nacional and had José and Maria as partners, each with a 50% stake.

The consolidated revenue of the Família Silva Group totaled R$ 5.2 million, exceeding the Simples Nacional maximum limit of R$ 4.8 million. This means that, if the fragmentation were disregarded, the simplified regime would be inapplicable to the entities. The identity of partners in the three legal entities, in the same proportion, and the complementary and symbiotic corporate objects, when combined, constitute objective indicators of abuse, according to CARF jurisprudence. To illustrate how this structure was built and where compliance failed, the group’s decision-making flow was analyzed, identifying the compliance gaps at each stage.

In the first stage, the identification of the risk of exclusion occurred when Alpha Comércio Ltda.’s revenue approached the sub-limit of Simples Nacional. The compliance gap identified was the absence of formal risk analysis and the lack of a documented tax policy. Subsequently, the splitting decision resulted in the creation of Beta and Gamma without a documented autonomous business purpose, evidencing the lack of tax due diligence and a prior assessment of Article 116, sole paragraph, of the National Tax Code.

The third stage, characterized by the integrated operation of the entities, demonstrated joint functioning, with sharing of addresses, teams, and suppliers. The compliance gap here was the absence of internal controls and accounting that did not reflect the autonomy between the companies. Subsequently, in the inspection phase, the Federal Revenue identified the identity of partners and the commingling of assets, revealing the lack of documentation of business purpose and corporate governance records. Finally, in the assessment and judgment by the CARF, there was a disregard for the fragmentation and the retroactive exclusion from the Simples Nacional, indicating that preventive compliance could have substantially avoided or mitigated the assessment.

Connection between the CARF Criteria and the Elements of the Simulated Case

The analysis of the simulated case, in light of the understandings consolidated by CARF, allowed the identification of typical elements of fiscal risk that, when present, reveal a strong potential for the characterization of simulation and abusive evasion. The absence of a clearly demonstrated business purpose, the centralization of strategic decisions, and the lack of financial independence between the entities were crucial factors. In the case of the Família Silva Group, José and Maria were partners in all three entities, in the same proportion of 50% for each, which aligns with the criterion of partner identity, according to CARF Ruling 1001-000.799.

The patrimonial confusion was evidenced by the unified cash and shared expenses without a documented formal allocation, a finding consistent with CARF Ruling 1102-001.301. The absence of business purpose was noted by the lack of operational autonomy or distinct clientele in any of the entities, reflecting the understanding of CARF Ruling 1001-000.799. Managerial unity was observed by the same address, same employees, same suppliers, and single management, also in accordance with CARF Ruling 1001-000.799.

Finally, the absent economic substance was characterized by the formal division of companies without independent economic activity, and by joint revenue exceeding R$ 4.8 million, which aligns with the STF’s decision in ADI 2446 (2022) and Article 116, sole paragraph, of the CTN. The convergence between the jurisprudential criteria and the elements of the simulated case was practically total, indicating that all the indicators of artificial fragmentation identified by the CARF in the analyzed decisions were present in the structure of the Família Silva Group. This analysis suggests that, in this scenario, the application of the general anti-avoidance rule would be subsidiary, with the CARF preferring to identify objective elements of simulation.

Tax Compliance as a Preventive Mechanism

In this context, tax compliance is introduced as a structured mechanism for preventing and mitigating tax risks. The research shows that adopting compliance practices allows for the creation of a governance environment focused on conformity, in which tax decisions are previously evaluated from the perspective of legality, transparency, and objective good faith. Unlike reactive action, compliance positions itself as a preventive instrument, capable of identifying weaknesses in corporate structures before they become the subject of questioning by the tax administration, strengthening legal certainty and business sustainability (IBGC, 2023).

The application of compliance to the simulated case demonstrated that the formalization of objective criteria for validating corporate reorganizations contributes significantly to the reduction of tax risks. The requirement for consistent economic justifications, the prior analysis of tax impacts, and the implementation of internal control mechanisms favor the construction of more solid structures from a legal and economic standpoint. Furthermore, the traceability of business decisions and adequate documentation of operations allow for greater security in defending against potential tax challenges, reducing informational asymmetry between the taxpayer and the Tax Authority (Healy & Palepu, 2001).

Another relevant aspect identified refers to the role of compliance as an alignment element between business strategy and the limits imposed by tax legislation. By establishing clear guidelines for conducting tax planning, compliance does not prevent the pursuit of tax efficiency, but conditions this pursuit on adherence to ethical and legal parameters, functioning as a validation mechanism for the strategies adopted. This approach aligns with agency theory (Jensen & Meckling, 1976), which views compliance as a mechanism to align interests and reduce opportunistic behaviors. The COSO (2013) framework and the OECD (2020) compliance guidelines provide the structure for operationalizing these principles.

Additionally, it was verified that the adoption of structured compliance practices tends to reduce the company’s exposure to tax litigation, as it anticipates potential interpretative conflicts and promotes the correction of deviations before they result in tax assessments. This characteristic reinforces the role of compliance not only as a legal tool but also as a strategic instrument for risk management and preservation of business value. To operationalize the research findings and translate theoretical concepts into practical application, decision-making support tools were developed, consisting of a tax risk assessment matrix and a proposed tax checklist.

Fiscal Risk Assessment Matrix

The developed fiscal risk assessment matrix organizes the main risk criteria associated with business fragmentation into three levels: low, medium, and high. The criteria considered were: business purpose, operational autonomy, corporate structure, management and administration, and economic substance. For business purpose, low risk is characterized by a clear and documented purpose, medium by a partially justified purpose, and high by a nonexistent or artificial purpose. Regarding operational autonomy, independent structures indicate low risk, partial sharing indicates medium risk, and total operational dependence indicates high risk.

Regarding the corporate structure, compatibility with the economic activity represents low risk, minor inconsistencies represent medium risk, and an artificial or fragmented structure indicates high risk. Separate management and administration denote low risk, partially shared medium risk, and centralized high risk. Finally, the economic substance present indicates low risk, reduced indicates medium risk, and absent indicates high risk. Applying this matrix to the simulated case of the Grupo Família Silva revealed that all criteria fall into the high-risk column, confirming the high tax exposure of the analyzed structure.

The reading of the matrix shows that the absence of business purpose, the total operational dependence between entities, and the centralization of management are, in isolation, factors of high fiscal risk. When verified in combination, as occurred in the simulated case, the potential for characterization of artificial fragmentation by the tax authority becomes even higher. It is important to emphasize that classifying risks as high does not imply automatic characterization of abuse, but indicates that the absence of controls in these dimensions substantially increases the probability of fiscal requalification. This analysis should be understood as preliminary, and its periodic review in light of new CARF decisions is recommended.

Proposal for a Tax Compliance Checklist

A proposal for a tax compliance checklist, of our own authorship, developed from the systematization of the jurisprudential criteria identified in this research, is presented below. This instrument has direct practical applicability and can be used by companies organized in corporate groups, accountants, and tax consultants as a preventive self-diagnosis tool. The checklist allows for the identification of compliance gaps before the formalization of corporate reorganizations, preventing them from becoming the subject of tax assessments. The checklist organizes the verification items into four thematic blocks, each related to the corresponding CARF criteria.

The first block, “Business purpose and corporate structure”, includes items such as the existence of a clear and formally documented business purpose for the adopted structure, the effective operational autonomy of companies with distinct clients, suppliers, and activities, the compatibility of the corporate structure with the economic activity carried out by each entity, and the distinction or differentiation of partners’ stakes in the entities. In the simulated case, all these items were classified as “Non-compliant”, indicating a fundamental failure in the compliance of the Família Silva Group’s structure with the criteria for lawful avoidance.

The second block, “Operational and Asset Segregation,” addresses the actual segregation of functions, employees, and activities among legal entities, the decentralization and formalization of strategic decisions by each entity, the possession of its own bank account and segregated cash flow by each entity, and the formalization by contract of the allocation of shared costs and expenses. In the simulated case, all items in this block were also classified as “Non-compliant,” reinforcing the perception of an integrated operation without real autonomy between the companies, which is a strong indication of artificial fragmentation for the CARF.

The third block, “Documentation and internal controls”, verifies the existence of documentation that proves the economic substance of the operations carried out, the performance of prior tax risk analyses before corporate structuring, the implementation of internal tax control and audit mechanisms, and the maintenance of records and traceability of fiscal and corporate decisions by the company. The application to the simulated case revealed that all items in this block were “Non-compliant”, indicating a critical absence of governance and documentation that could support the legitimacy of the operations before an inspection.

The fourth and final block, “Fiscal resistance assessment”, includes items such as monitoring the group’s consolidated revenue against the Simples Nacional sublimits, the existence of a formal tax compliance policy approved by the board of directors, and the capacity of the adopted structure to withstand an audit by the Federal Revenue Service or an analysis by CARF. In the simulated case, all these items were classified as “Non-compliant”, confirming that the structure of Grupo Família Silva presented high fiscal vulnerability and lacked the necessary governance mechanisms to mitigate the risks of penalties.

The result of the checklist, although referring to a fictitious case, faithfully reproduces the profile of companies that have been fined by CARF in situations of simulated splitting analyzed. The application of the instrument in real companies can offer a preventive and systematized assessment of the risk of characterization of abuse, serving as a starting point for the structuring of a tax compliance program. The checklist proposal does not constitute a guarantee of the lawfulness of the adopted planning, nor does it completely eliminate the risk of fines, but it is configured as an analytical and preventive instrument that, when applied in conjunction with specialized legal advice, contributes to the reduction of the company’s tax exposure. The findings presented, of a preliminary and analytical nature, cannot be definitively generalized, but the considerations on the preventive role of tax compliance should be understood as analytical hypotheses based on doctrine and jurisprudence.

In summary, the results obtained from the simulated case study and the analysis of CARF jurisprudence point, convergently, to the centrality of compliance as an instrument of preventive governance in the tax field. Compliance does not present itself as a substitute for tax planning, but as a condition for the sustainability of the adopted optimization strategies, ensuring that tax decisions are guided by economic rationality, objective good faith, and documentary transparency. The research reinforces the perspective that tax compliance, by adequately documenting business decisions, segregating assets and operations, and continuously monitoring risk indicators, contributes to tax planning being able to withstand the scrutiny of the tax authority, reducing exposure to litigation and strengthening corporate governance.

4. Conclusion

This study analyzed the effectiveness of tax compliance as an instrument for mitigating the risk of abusive tax avoidance characterization in business splitting structures within the Simples Nacional (Simplified National Tax Regime), in light of the jurisprudential criteria of the Administrative Council of Tax Appeals (CARF). It was verified that CARF adopts a consistent decision-making standard, disregarding corporate structures that, although formally valid, lack economic substance or legitimate business purpose, prioritizing operational autonomy and effective segregation of activities. The application of these criteria to a simulated case study demonstrated a high risk of abusive tax avoidance characterization, with the presence of elements such as identical partners, commingling of assets, absence of business purpose, managerial unity, and absent economic substance. The results indicated that tax compliance emerges as a central instrument of preventive governance, capable of strengthening legal certainty and business sustainability by aligning tax optimization strategies with ethical and legal parameters. As a practical contribution, a fiscal risk assessment matrix and a tax compliance checklist were developed, tools that assist in identifying compliance gaps and reducing litigation exposure.

Despite the simulated nature of the case study, which restricts empirical generalization of the findings, and the inferential basis for the relationship between compliance and risk reduction, the research reinforces the perspective that tax compliance does not replace tax planning, but acts as a condition for its sustainability. It contributes to tax decisions being guided by economic rationality, objective good faith, and documentary transparency, reducing informational asymmetry between the taxpayer and the Tax Authority. For future studies, it is suggested to apply the fiscal risk matrix and the tax checklist to real cases, through partnerships that allow data anonymization, and to periodically update the analysis criteria in light of new CARF decisions and any legislative changes, especially in the context of the Brazilian tax transition.

Bibliographic References

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Receita Federal do Brasil. 2026. Programa Sintonia: dados de conformidade tributária das empresas optantes pelo Simples Nacional. Divulgação via Agência Sebrae de Notícias. Disponível em: https://agenciasebrae.com.br/economia-e-politica/empresas-optantes-pelo-simples-nacional-possuem-maior-nivel-de-conformidade-tributaria-aponta-receita-federal/. Acesso em: 11 ago. 2026.

Supremo Tribunal Federal [STF]. 2022. ADI n° 2446. Rel. Min. Cármen Lúcia. Brasília, DF, Brasil. Disponível em: https://www.stf.jus.br. Acesso em: 11 ago. 2026.

Article originating from the Final Course Work of the Specialization in Compliance and ESG of the MBA USP/Esalq

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