Not withholding Income Tax (IR) on the payment of attorney’s fees awarded to a lawyer. This was the understanding of the 17th Civil Chamber of the Court of Justice of Paraná, in a decision indicating that the Judiciary is not responsible for controlling the collection of taxes, even if the amounts were defined by judicial decision.
In this case, the lawyer filed a lawsuit to collect an amount for services rendered to a bankrupt company. The amounts were sent to the court’s accountant so that the taxes levied on the defined amount could be calculated. According to the accountant, the lawyer owed R$ 7,400 in Income Tax, due to the 27.5% rate on the amount to be received.
Outcome – The understanding of the 17th Civil Chamber of the TJ-PR was that “it does not appear to be the responsibility of the Judiciary to control the withholding of income tax on income arising from a judicial decision.”
Article 46 of Law 8,541/1992 defines the withholding of such amounts as the responsibility of the payer. “The income tax levied on income paid in compliance with a judicial decision shall be withheld at the source by the individual or legal entity obligated to make the payment, at the moment when, by any means, the income becomes available to the beneficiary,” the provision determines.
For Appellate Judge Lauri Caetano da Silva, the rapporteur of the case, the Judiciary may not act as the paying source, even when the amount in question is a judicial deposit. “The responsibility falls upon the person designated as its beneficiary,” he said.
In addition to the limits of judicial action, the rapporteur detailed that the taxation model for the professional individual and for liberal professionals classified under the Simples Nacional (Brazil’s simplified tax regime) or under law firms (Supplementary Law 147/2014) is different from that of other persons and companies.
These differences, including in the collection and in the rates, the appellate judge continued, prevent the Judiciary from withholding at the source the Income Tax levied on judicial deposits. “This responsibility has become exclusive to the beneficiary of the credit, especially when we are dealing with the payment of attorney’s fees.”
Click here to read the decision.
(Source: Conjur)
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