Articles | Postado no dia: 4 November, 2026
Can a Company Be the Author of Software? Understanding a Recent CARF Ruling
Brazil’s Administrative Council of Tax Appeals (CARF) First Panel of the Superior Chamber ruled, by a vote of 6 to 4, that legal entities may hold copyright over computer programs. As a result, corporate income tax (IRPJ) assessments against Microsoft Brazil were overturned. The company had deducted from its taxable income amounts paid abroad as royalties for software and game licenses.
The dispute revolved around an old legal provision. Law No. 4,506/1964 allows royalty deductions only when the payment is necessary for the company to use the right that generates its revenue. Tax authorities argued that there could be no copyright royalties because the Copyright Law defines an author as the individual who creates the work. The defense relied on the Software Law, which expressly refers to authors and rights holders as either “individuals or legal entities.” This interpretation prevailed because the Software Law is the more specific legislation.
The ruling reflects how technology is developed today. Software is created by teams, and the Software Law itself grants employers or contracting parties the rights to works developed under contracts specifically intended for that purpose or when such activities fall within the contractor’s assigned duties, unless otherwise agreed.
The narrow margin, however, indicates that the issue remains open to debate. Four members of the panel understood that a company is not the author itself, but rather the assignee of economic rights, which would require a different analysis regarding the deductibility of the payments.
In practice, companies that pay or receive software royalties must be able to demonstrate the origin of ownership. This involves having contracts with developers that clearly address intellectual property rights, licenses that accurately describe the rights granted and, whenever possible, software registration with the Brazilian National Institute of Industrial Property (INPI). Although registration is not mandatory, it provides documentary evidence of authorship and ownership.
This raises an important question for companies that license technology today: if tax authorities requested proof tomorrow of who holds the rights to the software for which royalties are paid, would the relevant documentation be ready?
Authors: Beatriz Carvalho and Igor Frota Moreira
