Taxation of Profits and Dividends Remitted Abroad under New Law No. 15,270

Originally published in December 2025

On November 26, 2025, Law No. 15,270 was published, with the main purpose of establishing rules for the taxation of dividends paid by companies to individuals resident in Brazil. Among other important measures, the law establishes the levy of individual income tax (IRPF) at a rate of 10% on remittances exceeding the monthly amount of R$50,000.00 (fifty thousand reais).

The law also provides for the taxation of profits and dividends paid, credited, delivered, used, or remitted abroad, which will be subject to withholding tax (IRRF) at a rate of 10%. In this case, however, the reducers characteristic of taxes levied on corporate income in Brazil (CSLL and IRPJ) do not apply. Furthermore, unlike the taxation applicable to profits distributed to individuals resident in Brazil, dividends remitted abroad must be taxed regardless of: (i) whether the beneficiary of the remittance is an individual or legal entity domiciled abroad; (ii) the amount of the remittance; and (iii) whether the remittances were made by the same legal entity.

However, withholding tax (IRRF) will not apply to profits and dividends paid, credited, used, delivered, or remitted to: (i) foreign governments, provided that there is a reciprocal treatment regarding the income earned in their countries by the Brazilian government; (ii) sovereign funds, defined as investment vehicles abroad whose assets consist exclusively of resources derived from the country's sovereign savings; and (iii) foreign entities whose main activity is the administration of pension benefits, such as retirement and pension plans, as defined in specific regulations.

It is worth noticing that withholding tax (IRRF) exemption will apply to profits and dividends paid to foreign individuals or companies if the resolution approving their distribution was adopted by December 31, 2025, provided that the profits to be distributed were generated up to calendar year 2025 and are actually distributed by calendar year 2028. Finally, we highlight that, in the exemption scenarios mentioned in the previous paragraph (remittances to foreign governments, sovereign funds, and pension entities), there is no need for the distribution to be approved by December 31, 2025, since, only in these cases, the exemption applies regardless of when the remittance is approved.

Lorusso & Partners continues to monitor all developments arising from the enactment of Law No. 15,270 and remains available to develop customized wealth and tax planning strategies, as well as to clarify any questions related to this topic.