Accelerated Depreciation: how to reduce taxes and modernize your business

The Accelerated Depreciation Program, recently implemented by the Ministry of Development, Industry, Commerce, and Services (MDIC) in partnership with the Ministry of Finance, offers a unique opportunity for companies in various sectors to modernize their operations and reduce their tax burden. Effective since September 13th, the program aims to boost investments and productivity in Brazilian companies, offering significant tax incentives.

What is Accelerated Depreciation?

Accelerated depreciation is a mechanism that allows companies to quickly deduct the value of their assets, such as machinery and equipment, when calculating Corporate Income Tax (IRPJ) and Social Contribution on Net Income (CSLL). This reduces the tax base, enabling significant savings over two years.
This benefit applies to companies that acquire capital goods, meaning assets that increase productive capacity or improve operational performance, such as state-of-the-art machinery and equipment. These assets, typically depreciated over their useful life, can now have their value amortized faster, reducing tax liabilities and freeing up resources for new investments.

Sectors benefited by the program

The Accelerated Depreciation Program benefits companies in 23 strategic sectors of the Brazilian economy, including:

• Paint and varnish manufacturing
• Pharmaceutical industry
• Plastic, rubber, wood, and paper products
• Metallurgy and textile products
• IT, electronics, and automotive accessories
• Civil construction

These sectors have the opportunity to modernize their operations, with access to R$ 3.4 billion in financial credits for the acquisition of machinery and equipment. Of this total, R$ 1.7 billion will be released by the end of 2024, accelerating the industrial modernization process in Brazil.

How Accelerated Depreciation impacts business accounting

For companies adhering to the program, business accounting plays a strategic role. Proper bookkeeping and tax planning are essential to maximize the program’s benefits and ensure that acquired assets are correctly depreciated within the established timelines.
Effective accounting management will enable companies to take advantage of tax credits, optimize cost structures, and reinvest tax savings into operational improvements. Additionally, with the proper application of depreciation rules, businesses can enhance their market competitiveness while maintaining financial health.

How to join the program

Enrollment in the Accelerated Depreciation Program must be done directly with the Federal Revenue Service. To ensure your company is adequately prepared to participate and reap the benefits of the program, it’s essential to rely on the support of a specialized accounting team.

Conmax is the ideal partner for your company’s accounting modernization

If you are seeking efficient accounting management and want to make the most of the Accelerated Depreciation Program benefits, Conmax is the ideal partner. Our team of consultative business accounting specialists is ready to help your company optimize processes, reduce tax costs, and prepare for growth. We offer comprehensive accounting advisory services, focusing on medium and large-sized businesses, ensuring your company remains competitive and profitable in a dynamic market.

Contact Conmax and discover how we can transform your company’s accounting!