New taxation on dividends above R$ 50,000 requires a review of tax planning and reignites debate in the Supreme Court.

Credits: Political Crumbs

Starting in January 2026, profits and dividends paid by the same company to the same individual residing in Brazil, exceeding R$ 50,000 per month, will be subject to a 10% withholding tax. This change, stipulated in Law 15.270/25, directly alters how businesses must plan the distribution of profits. Although presented as a measure aimed at “high incomes,” the new rule affects partners, family businesses, professional partnerships, and businesses that use dividends as a significant part of their partners’ remuneration.

The most sensitive detail lies in the way the charge is structured. When the monthly limit is exceeded, the 10% rate applies to the total distributed in that month, and not only to the amount exceeding R$ 50,000. In practice, if a partner receives R$ 49,000, there is no monthly withholding. But if they receive R$ 51,000, the withholding will be R$ 5,100.00, corresponding to 10% of the total amount. The result is a clear distortion: someone who receives R$ 51,000 will have less net available funds than someone who received R$ 49,000. If the tax were levied only on the excess, the withholding would be R$ 100.00, eliminating the so-called “step effect”.

This disproportionate effect is one of the points already brought before the Supreme Federal Court (STF). The matter awaits a judgment on its merits, while the law remains in effect and continues to impact the finances of partners and companies.

Law 15.270/25 included Article 6-A in Law 9.250/1995 and altered a system in effect since 1996, when regularly accrued profits were exempt from distribution to partners. Now, the company assumes the obligation to withhold tax whenever it makes payments, credits, deliveries, or uses profits and dividends above the established monthly limit. If there is more than one payment in the same month by the same legal entity to the same partner, the withholding must consider the accumulated value for the period.

There are also implications for annual tax calculations. Individuals with annual incomes exceeding R$ 600,000 fall under the minimum tax regime, with a progressive rate that can reach 10% for incomes equal to or greater than R$ 1.2 million. Monthly withholdings can be considered in this calculation, but this does not eliminate the immediate financial impact of the new rule.

Profit distribution is no longer a purely accounting decision. Business owners now have to evaluate when to distribute profits, how much to distribute, through which company to distribute them, and how to remunerate the partners. What was once treated as routine corporate practice now requires tax, accounting, and legal analysis.

The discussion is not limited to the Simples Nacional (Simplified National Tax Regime). It is true that, within this regime, the controversy takes on stronger dimensions because the Constitution guarantees differentiated treatment to micro and small businesses, and Complementary Law 123/06 provides its own rule for profit distribution. There is a basis for arguing that an ordinary law could not, in practice, reduce a protection established by a complementary law.

But companies operating under the presumed profit regime, actual profit regime, professional partnerships, holding companies, and family businesses also have reasons to consider litigation. In these cases, the grounds may involve contributory capacity, lack of real progressivity, tax equality, distortions caused by the step effect, and economic double taxation.

The expression “double taxation” frequently appears in public debate, but the more technically appropriate term is economic double taxation. Profits are already taxed at the corporate level and then, when distributed to the partner, are taxed again at the individual level. The government claims that the law provides compensation and reduction mechanisms, but the criticism remains: there is a new layer of taxation on the results of business activity.

The most pressing issue lies in the risk of the Supreme Federal Court (STF) modulating the effects of the decision. When the STF rules on tax matters with significant financial impact, it is common practice to define when the decision will take effect and who will be entitled to restitution or compensation for amounts unduly paid.

In many situations, only taxpayers who filed a lawsuit before the judgment are able to preserve their right to the credit. Therefore, the discussion is not just about paying or not paying now, but about safeguarding a legal position for the future. The company that files the appropriate action brings a relevant constitutional controversy to the Judiciary and seeks to preserve the right to challenge the demand, recover amounts, or offset credits should the Supreme Federal Court recognize the total or partial invalidity of the collection.

Each case requires its own analysis. In the Simples Nacional (Simplified National Tax Regime), the fundamentals involve constitutional protection for micro and small businesses and the hierarchy of complementary law. In the presumed profit and actual profit regimes, the discussion may involve contributory capacity, progressivity, equality, distortions of the step effect, and economic double taxation.

Caution is also needed with improvised solutions. Fragmenting payments, artificially altering partner remuneration, or attempting to circumvent the monthly limit without an accounting and legal basis can generate a greater tax risk than the taxation itself.

While the Supreme Federal Court (STF) has not yet ruled on the merits of the case, the law continues to have effect. Companies that distribute profits exceeding R$ 50,000 per month need to assess their exposure, review their distribution policy, and consider the advisability of filing a lawsuit to protect their rights.

The new dividend taxation should not be treated as an accounting adjustment. It interferes with how the business owner withdraws profits, manages cash flow, remunerates partners, and projects the company’s growth.

Therefore, ignoring the discussion could mean paying now and losing the possibility of recovering amounts in the future. Filing the appropriate legal action, on the other hand, could preserve the company’s legal position should the Supreme Federal Court recognize the total or partial unconstitutionality of the charge and modulate the effects of the decision.

Rozely Dias

Senior tax attorney at Jacó Coelho Advogados, with two decades of exclusive dedication to the tax area. Specialist in Tax Planning from Unialfa and graduated in Law from the Pontifical Catholic University of Goiás (PUC/GO).