Taxation of Dividends in Brazil in 2026: Understanding Law No. 15,270/2025

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Law No. 15,270/2025 introduced rules that will take effect as of January 1, 2026, including the withholding of income tax on profits and dividends in specific situations.

For Brazilians living abroad who continue to receive dividends from companies in Brazil, and for foreign investors holding equity interests in Brazilian companies, this topic is essential, as it involves withholding tax, proof of tax residence, and interaction with double taxation treaties.

1) General rule: 10% withholding tax on dividends above BRL 50,000/month (Brazilian residents)

The Law inserted Article 6-A into Law No. 9,250/1995, providing that, as of January 2026, when the same legal entity pays, credits, or distributes profits and dividends to the same individual resident in Brazil in an amount exceeding BRL 50,000 in a given month, a 10% withholding income tax (IRRF) shall apply to the total amount.

The rule also establishes:

• prohibition of deductions from the tax base;

• recalculation when there is more than one payment in the same month by the same company to the same individual.

The Brazilian Federal Revenue Service has issued initial guidance confirming the application of this rule as of January 2026.

2) Dividends paid to residents or domiciliaries abroad: heightened attention required

For Brazilians who have completed a formal tax exit and are now non-residents, as well as for foreigners receiving dividends from Brazil, the analysis becomes more sensitive because it generally involves:

• withholding tax in Brazil;

• domestic tax rules;

• and the possible application of a double taxation treaty (when existing and applicable).

Attention: the tax treatment may vary depending on the country of residence and the existence of a tax treaty.

3) Transitional rules: profits earned up to 2025

The Law provides that profits and dividends are not subject to the monthly taxation set forth in Article 6-A when they:

• relate to results earned up to the 2025 calendar year;

• had their distribution approved by December 31, 2025; and

• are payable in accordance with civil and corporate law, with payment made under the originally approved terms.

As this is an operationally sensitive matter (corporate documentation, minutes, resolutions, and deadlines), the Federal Revenue Service has also addressed the topic in its “Questions and Answers” materials.

4) Who may be impacted (typical examples)

• Shareholders of operating companies in Brazil that regularly distributed dividends;

• Professionals who receive dividends as a monthly income supplement;

• Brazilians living abroad with equity interests in Brazilian companies;

• Foreigners in Brazil holding Brazilian corporate structures;

• Families that use dividend income to fund living or education expenses abroad.

5) What to do in practice (compliance and planning)

Common measures (always subject to individual analysis):

• Mapping the origin of profits;

• Organizing corporate documentation;

• Reviewing dividend distribution policies.

Conclusion

Law No. 15,270/2025 marks a new phase of attention to dividend taxation as of January 2026, introducing an objective 10% with holding tax rule in specific situations and transitional provisions that require solid documentation.

If you live abroad and receive dividends from Brazil, or if you are a foreign investor with equity interests in Brazilian companies and wish to engage professional legal services, our firm specializes in this area. Please contact us at contato@trpuppioadvocacia.com.br.

FAQ

Will dividends be taxed in Brazil in 2026?

There are situations in which withholding tax applies under Law No. 15,270/2025, depending on the case.

What is the withholding income tax rate on dividends?

Article 6-A establishes a 10% rate for the specific situation described (amounts above BRL 50,000 per month paid by the same company to the same Brazilian-resident individual).

Will profits earned up to 2025 be taxed?

The Law provides for non-taxation in certain cases under Article 6-A, §3, subject to formal requirements.