Short answer. A Brazilian company’s profit is taxed by two federal levies, not one: IRPJ (corporate income tax) and CSLL (social contribution on net profit). They are charged at the company level, on top of each other. What you choose — and what changes when the owner is foreign — moves the real number more than the headline rate suggests. And from 2026, getting the profit out adds a new layer: a withholding tax on distributed dividends.
IRPJ and CSLL: two levies, one profit
Foreign groups often ask for “the corporate tax rate in Brazil.” There isn’t a single one. Corporate profit is taxed by:
- IRPJ — the corporate income tax. Base rate 15%, plus a 10% surtax on the portion of profit exceeding R$20,000 × the number of months in the period (R$240,000 for a full year). [Source: Lei 9.249/1995, art. 3 — Planalto; Receita Federal — IRPJ guidance]
- CSLL — a social contribution on net profit. General rate 9%. Specific CSLL rates may apply to regulated sectors, especially financial institutions, and should be checked case by case before modelling the effective tax burden. [Source: Lei 7.689/1988; LC 224/2025 — Planalto; Receita Federal / PGFN]
Stacked, the entity-level nominal load under the actual-profit regime is often summarized as ~34%. Treat that figure carefully: it is the company-level nominal rate for the general case — the 10% surtax only applies above the threshold, so the effective rate varies, and it is not the total burden once profit is distributed (it is a distinct layer — see the 2026 dividend section). [Source: Lei 9.249/1995; Lei 7.689/1988 — Planalto]
Choosing the taxable-income regime
How much IRPJ/CSLL you actually pay depends on the regime used to measure profit:
- Lucro Real (actual profit): tax on real accounting profit, adjusted. Mandatory above a gross-revenue ceiling and for certain activities; allows offset of losses and credits.
- Lucro Presumido (deemed profit): tax on a margin presumed from revenue — simpler, available to companies with prior-year gross revenue up to R$78 million. [Source: Lei 9.718/1998, art. 13 — Planalto]
- Lucro Arbitrado (arbitrated profit): exceptional, used when books are unreliable.
For a foreign-owned subsidiary, the Real-vs-Presumido choice is a planning decision, not a formality: margins, activity and revenue all change which one is cheaper — and whether you even qualify.
What changes when the owner is foreign
Two cross-border points deserve attention:
- Transfer pricing. When the Brazilian company transacts with related parties abroad, Brazil’s transfer-pricing rules apply. Brazil moved to OECD-aligned (arm’s length) rules under Lei 14.596/2023, mandatory from 2024 (optional for 2023), regulated by IN RFB 2.161/2023. This affects intercompany pricing of goods, services, royalties and intra-group financing. [Source: Lei 14.596/2023; IN RFB 2.161/2023 — Planalto / Receita Federal] (If there are no related parties abroad, this section does not apply to you.)
- Getting profit out (new in 2026). Historically, distributed profits were not taxed on the way out. That changed. From 1 January 2026, a 10% withholding (IRRF) applies to distributed profits and dividends — including remittances to non-residents. [Source: Lei 15.270/2025 — Receita Federal guidance, Dec/2025] Non-resident withholding is collected on the day of the triggering event; exceptions include profits earned through 2025 and approved by 31/12/2025, foreign governments under reciprocity, and sovereign/overseas-pension funds. Treaty relief is analysed case by case, by jurisdiction.
The dividend layer: do not assume “exempt”
A common — and now outdated — assumption is that Brazilian dividends are exempt. For distributions of 2026 profit onward, that is no longer the rule: a 10% withholding applies above the legal threshold and reaches non-resident shareholders. The practical consequence for a foreign owner is that the after-tax cost of repatriating profit is higher than the entity-level ~34% alone. Model both layers — company-level IRPJ/CSLL and the distribution withholding — and check treaty relief for your jurisdiction. For residents, the 10% applies to amounts above R$50,000/month paid by the same company; for non-residents, the 10% applies on remittance. [Source: Lei 15.270/2025; Receita Federal — IRRF on profits/dividends, Dec/2025]
Reform check: IBS/CBS is not the same as IRPJ/CSLL
Foreign readers frequently conflate Brazil’s headline tax reform with corporate income tax. They are different tracks:
- The IBS/CBS reform (EC 132/2023; LC 214/2025) overhauls consumption taxes — it replaces PIS, Cofins, IPI, ICMS and ISS with a dual VAT. It does not replace IRPJ or CSLL. [Source: EC 132/2023; LC 214/2025 — Planalto]
- Income taxation is also changing, but through a separate law (Lei 15.270/2025 — dividends and high-income taxation), not through the IBS/CBS reform.
So: the consumption-tax reform does not touch your corporate income tax bill — but a distinct income-tax change does affect distributions from 2026.
For multinational groups within the GloBE scope, ordinary IRPJ/CSLL must also be distinguished from Brazil’s separate top-up mechanism. See Brazil QDMTT: Additional CSLL Guide for 2026.
Compliance, at a high level
A foreign-owned entity will file the annual ECF (SPED accounting-fiscal bookkeeping) and the applicable federal declarations (DCTF/DCTFWeb), with EFD-Reinf now used to report dividend withholding. This is mentioned for orientation only — it is not an operational filing manual. [Source: Receita Federal — SPED/ECF, DCTFWeb and EFD-Reinf]
FAQ
Is there a single corporate tax rate in Brazil? No. Corporate profit is taxed by IRPJ plus CSLL at the company level; the effective load depends on the profit regime.
Are dividends from a Brazilian company tax-free for a foreign shareholder? Not for 2026 profit onward. A 10% withholding applies, including on remittances abroad, under Lei 15.270/2025 (residents: above R$50,000/month per paying company; non-residents: on remittance, with limited exceptions).
Does the IBS/CBS reform change IRPJ/CSLL? No — that reform covers consumption taxes. Income-tax changes come from a separate law.
Which profit regime should our subsidiary use? It depends on revenue, margins and activity. Lucro Presumido is available up to R$78M/year of gross revenue; above that, Lucro Real is mandatory.
📚 Part of our pillar guide: Corporate Tax in Brazil — The Complete Guide for Foreign Companies.
Sources
Official sources reviewed for this brief: the corporate income tax legislation (Lei 9.249/1995), the CSLL law (Lei 7.689/1988), the Lucro Presumido threshold (Lei 9.718/1998), the transfer-pricing rules (Lei 14.596/2023), the 2026 dividend taxation law (Lei 15.270/2025), and Receita Federal guidance on IRPJ, CSLL and withholding on profits and dividends.