Subcontract purchases and sales

A subcontract is an operation that is performed by a subcontractor. It is a practice that is used by companies to reduce costs by transferring portions of work to outside vendors.

There are two types of subcontract orders. One type is integrated with a manufacturing order. Another type does not have a manufacturing order.

Brazil specifics

This list shows the subcontracting requirements for Brazil:

Shipment of raw materials to the vendor
An invoice is issued to deliver raw materials for industrialization. The CFOP is either 5901 for internal operations or 6901 for interstate operations, specifically remittance for industrialization.
Vendor symbolic return of the raw materials received for industrialization
A symbolic return invoice is issued for raw materials received for industrialization. The CFOP is either 5902 for internal operation or 6902 for interstate transaction, specifically the return of goods used in industrialization.
Vendor returns of raw materials unused in the industrialization process to the requester
An invoice is issued for the actual return of raw materials received for industrialization. The CFOP is either 5903 for internal operation or 6903 for interstate transaction, specifically the return of goods received for processing and not applied in that case.
Charge for the industrialization process
An invoice is issued to charge the industrialization process.