# Understanding compliance

Source: https://developer.avalara.com/products/tax-compliance/integration-guides/extractor-en/concepts/understanding_the_scenario/

Guide: Brazil Returns (Tax compliance) - English

# Understanding compliance

Compliance in Brazil can be seen as a set of three interrelated processes.

-   The first one, period-end processing, consists of gathering all the tax data from transactions and other sources (GL, depreciation, other credits) to arrive at the net amount to remit or to be carried over to the next period.
-   The second one is the actual payment remittance. This is the actual form that is filled out and taken to the bank for payment.
-   The third step is the electronic file SPED that needs to be submitted. Steps one and two are normally done within a few days of the period end while the SPED is usually submitted at a later date.

### SPED

Compliance in Brazil has become mostly electronic. It consists of gathering information from transactions and in some cases from GL posting in order to create elaborate files that are submitted to the tax authority. These files support the tax calculations performed at period end as well as the tax remittances. The tax authorities use the data to cross-reference the operation data from different reports and activities. In Brazil, users commonly refer to these reports as "Obrigações Fiscais," loosely translating it as "fiscal obligations," or using the acronym SPED.

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