Priscilla Folgosi Castanha
Lawyer at Marcos Martins Advogados
The 21st Chamber of Private Law of the São Paulo Court of Appeals recently handed down a ruling in an interlocutory appeal seeking to overturn the lower court’s decision, handed down in the execution proceedings, which rejected the request to seize the debtor’s income tax refund, holding that it was unseizable because it was in the nature of a salary.
In the case in question, the creditor obtained, through an Infojud search, access to copies of the debtor’s income tax returns, finding that there was an amount to be refunded. It therefore requested the attachment of the amount of the refund. However, the court held that the return to the taxpayer of the income tax withheld at source, referring to the refund of part of the salary, remains in the nature of a salary and consequently has the characteristic of being unseizable.
In support of his decision, the judge based his decision on a precedent from the Superior Court of Justice, which holds that the unseizability of a claim relating to an income tax refund is based on the fact that the taxable event of the refund is the taxpayer’s salary, which in turn is unseizable. Therefore, when an income tax refund is made, the nature of the salary remains the same.
Therefore, the 21st Chamber of Private Law unanimously dismissed the creditor’s appeal, upholding the decision to reject the request for attachment of the debtor’s income tax refund, since it is a salary amount and is considered unattachable, under the terms of 833, item IV, of the Code of Civil Procedure.
