Corporate tax and dividends in Brazil: the current rules
Profit tax and the tax on paying that profit out are two different questions, and 2026 changed the answer to both: a revenue-linked surcharge on the presumption regime, and, for the first time, a withholding tax on dividends leaving the country.
The short answer
Brazil taxes corporate profit through IRPJ and CSLL, unaffected by the consumption tax reform, and since 1 January 2026 also taxes profit leaving the country as a dividend, through a new 10% withholding. A separate change from April 2026 raises the effective tax on larger companies using the Lucro Presumido regime. None of this replaces or reduces PIS/COFINS, which run separately and are covered on tax reform for what changes there from 2027.
IRPJ and CSLL
| Fact | Value | Basis |
|---|---|---|
| IRPJ base rate | 15% | Lei 9.249/1995 article 3 |
| IRPJ surcharge | +10% on the part of profit above R$20,000 per month (R$240,000 per year) | Lei 9.249/1995 article 3 |
| Rate by regime | Same IRPJ and CSLL rates in Lucro Presumido and Lucro Real; only the tax base differs | Lei 9.249/1995 |
| CSLL, ordinary company | 9% for trade, services and manufacturing | Lei 9.249/1995 |
| CSLL, banks and some financial institutions | 15-20% | Lei 9.249/1995, as amended for financial institutions |
| Combined, ordinary company, Lucro Real | About 34% of profit | Derived from the rates above |
Lucro Presumido versus Lucro Real
Lucro Presumido taxes a presumed share of revenue rather than actual profit: 8% of revenue for trade, 32% for services, as the base IRPJ/CSLL presumption before the rates above apply. It suits a company with a stable, high margin, since the tax does not fall if the real margin is thinner. Lucro Real taxes actual profit with deductions, and is mandatory above a revenue threshold this page does not state without a confirmed source; it favours a company with a low margin or high deductible expenses. Simples Nacional, the third regime most domestic small companies use, is closed to any company with foreign participation, corporate or individual (LC 123/2006 article 3 §4 I-II, article 17 II; see company formation for the mechanics), so a foreign-owned importer runs on Presumido or Real from the outset, never Simples.
LC 224/2025: the Lucro Presumido surcharge above R$5 million
Confirmed against the official text on planalto.gov.br. Article 4 §4 VII and §5 add 10 percentage points to the presumption percentage, applied to the part of annual revenue above R$5,000,000: trade's presumption rises from 8% to 18% on that excess, services from 32% to 42%. It takes effect on the first day of the fourth month after publication (article 14 I); published 26 December 2025, the surcharge applies from April 2026, for both IRPJ and CSLL on the same date, since the text does not stagger them separately (older commentary splitting IRPJ and CSLL into different start dates, or citing "R$1.25 million per quarter," is an interpretation this page does not use). The calculation procedure runs through IN RFB 2.306.
The rule is contested: an individual liminar, 1ª Vara Federal de Resende/RJ, case 5000259-79.2026.4.02.5116, decided 27 January 2026 and under appeal at TRF-2; a collective mandado de segurança filed by Sescon-SP; and ADI 7920 at the STF. As of September 2026 the rule applies nationally regardless of this litigation, and this page states the litigation as a caveat, reached through a secondary legal source, rather than as a reason to disregard the surcharge.
Withholding on dividends paid abroad
Lei 15.270/2025, in force from 1 January 2026, added a 10% withholding income tax on profits and dividends paid, credited, delivered, used or remitted, expressly including abroad (article 10 §4 of Lei 9.249/1995, as amended). Before this law, dividend distributions abroad carried no withholding. A transition rule in article 10 §5 I exempts profits and dividends tied to results through the 2025 calendar year, where the distribution itself was approved by 31 December 2025, as long as the actual payment, credit, use or delivery happens by 2028. Where more than one payment reaches the same recipient in the same month from the same company, the amount withheld is recalculated against the total paid that month.
PIS/COFINS by regime, before the reform replaces them
| Regime | PIS | COFINS | Total | Credits |
|---|---|---|---|---|
| Cumulative (typically Lucro Presumido) | 0.65% | 3% | 3.65% of revenue | No input credits |
| Non-cumulative (typically Lucro Real) | 1.65% | 7.6% | 9.25% of revenue | Credits along the chain |
These rates run under Lei 9.718/1998 (cumulative regime) and Leis 10.637/2002 and 10.833/2003 (non-cumulative regime), and stop applying once CBS replaces both from 2027, per the schedule on tax reform.
Sources
- IRPJ, CSLL and the surcharge threshold: Lei 9.249/1995, article 3, planalto.gov.br.
- LC 224/2025: official text, planalto.gov.br, article 4 §4 VII and §5, article 14 I, confirmed 18 September 2026. Litigation detail: a secondary legal source (Barbieri Advogados), not independently re-confirmed.
- Dividend withholding: Lei 15.270/2025, amending Lei 9.249/1995 article 10 §4 and §5, confirmed directly against the primary text on planalto.gov.br and camara.leg.br.
- Simples Nacional exclusion: LC 123/2006, article 3 §4 I-II, article 17 II.
- PIS/COFINS by regime: Lei 9.718/1998; Lei 10.637/2002; Lei 10.833/2003.
Rates verified 18-24 September 2026. Tax rules change; check the current text of each act, particularly the LC 224/2025 litigation, before relying on a figure for a specific filing.
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Frequently asked questions
What is the combined IRPJ and CSLL rate on an ordinary company's profit?
About 34% under Lucro Real for an ordinary trade, services or manufacturing company: IRPJ at 15% plus a 10% surcharge on the part of profit above R$20,000 per month (R$240,000 per year), and CSLL at 9%. Banks and some financial institutions pay CSLL at 15-20% instead of 9%. Basis: Lei 9.249/1995 article 3.
Is there a new surcharge on Lucro Presumido for larger companies?
Yes, from April 2026. LC 224/2025 adds 10 percentage points to the presumption percentage on the part of annual revenue above R$5,000,000: trade goes from 8% to 18% presumed profit on the excess, services from 32% to 42%. It applies from the first day of the fourth month after publication; published 26 December 2025, so in force from April 2026, for both IRPJ and CSLL on the same date. The rule is contested in court, including an individual liminar under appeal and an ADI at the STF, but applies nationally as of September 2026.
Is there withholding tax on dividends paid to a foreign shareholder now?
Yes, from 1 January 2026. Lei 15.270/2025, amending article 10 of Lei 9.249/1995, sets a 10% withholding income tax on profits and dividends paid, credited, delivered, used or remitted, including abroad. Before this law, dividend distributions abroad were not subject to withholding. A transition rule exempts profits from results through 2025 whose distribution was approved by 31 December 2025, as long as payment happens by 2028.
Does the consumption tax reform change profit tax or the Presumido/Real regimes?
No. IRPJ, CSLL and the choice between Lucro Presumido and Lucro Real are not touched by EC 132/2023 or LC 214/2025. The reform replaces PIS, COFINS, ICMS and ISS; it leaves profit tax exactly where it is.
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