Tax Law

Barank Advogados in the area of Tax Law, provides complete specialized services, from due diligence to tax litigation, when necessary. This is one of the most traditional and solid areas of practice of the firm, which since the beginning of its activities has provided tax advice and consultancy to companies of the most diverse sizes and from the most different segments. Therefore, experience, constant updating on the subject, and high quality standards are what define the rendering of services in this area.

The firm works, initially, in the drafting of legal opinions regarding the Brazilian tax legislation (at the Federal, State, and Municipal levels), with a focus on tax avoidance, which consists in the performance of ethical and lawful procedures that seek the reduction and/or elimination of tax costs incurred in business activities. The performance of Barank Law Firm is always effective, objective, and, above all, with responsibility and technical excellence before the rights and interests of its clients.

The performance of Barank Law Firm in the area of Tax Law is always interdisciplinary, especially with the areas of Business Law, Labor Law, and Criminal Law, with investment in the long-term relationship with the client and aiming to enable the exercise of business activity free of intercurrences that can hinder its operation and financial health.

There are especially among the services provided by the firm in Tax Law:

• Tax diagnosis in order to identify tax credits to be recovered;
• Due diligence to account for possible contingencies and tax liabilities in company acquisitions;
• Elaboration of tax planning directed to each business activity;
• Acting so that the payment of amounts unduly determined by inspection agencies is avoided, in administrative and judicial spheres (notices of infraction, inspections, tax foreclosures, etc.);
• Filing of lawsuits that aim to stop the collection of illegal/unconstitutional taxes and also the recovery of unduly paid amounts.

Frequently Asked Questions on Tax Law in Brazil

Barank Advogados, a tax and business law firm based in Maringá, Paraná, Brazil, answers the most common questions from foreign companies and investors about Brazilian taxes, tax regimes, the tax reform and tax disputes. We work in English, Portuguese and French.

What are the main taxes paid by companies in Brazil?

Companies in Brazil are subject to federal, state and municipal taxes. The main ones are corporate income tax (IRPJ) and social contribution on net profit (CSLL), PIS and COFINS on revenue, ICMS on the circulation of goods, ISS on services and IPI on manufactured products. Brazil’s tax reform is gradually replacing PIS, COFINS, ICMS, ISS and part of IPI with new taxes, which makes tax planning for foreign companies even more important.

Which tax regime should a foreign-owned company choose in Brazil?

Brazilian companies can be taxed under Lucro Real (actual profit), Lucro Presumido (presumed profit) or Simples Nacional. Companies that have another company as a shareholder, including a foreign parent company, generally cannot opt for Simples Nacional. The choice between actual and presumed profit depends on revenue, margins, costs and the business model, and the wrong choice can significantly increase the tax burden.

How does Brazil’s tax reform (CBS and IBS) affect foreign investors?

Brazil’s consumption tax reform replaces PIS, COFINS, ICMS and ISS with a dual VAT system made up of CBS (federal) and IBS (state and municipal), with a gradual transition that began in 2026 and runs until 2033. The new system changes how credits, prices and supply chains work. Foreign investors entering or expanding in Brazil during the transition should model both the current and the future scenarios.

Are dividends paid to foreign shareholders taxed in Brazil?

The taxation of dividends paid by Brazilian companies to shareholders abroad has changed with Brazil’s income tax reform, and the applicable treatment may depend on the investor’s country of residence and on double taxation treaties. The way profits are distributed, and alternatives such as interest on net equity, should be analyzed case by case to lawfully reduce the overall tax cost.

Does Brazil have a double taxation treaty with my country?

Brazil has double taxation treaties with dozens of countries, including several European, Latin American and Asian countries, but not with the United States. These treaties may reduce withholding taxes on interest, royalties and services and avoid the same income being taxed twice. Checking the treaty and its specific rules before structuring the investment can make a significant difference.

How are cross-border services, royalties and imports taxed in Brazil?

Payments abroad for services, royalties and technology may be subject to withholding income tax, CIDE, PIS and COFINS on imports and ISS, depending on the nature of the payment. Imports of goods are also subject to import duty, IPI, PIS, COFINS and ICMS. The correct classification of each transaction and the contract wording directly affect the total tax cost.

What are Brazil’s transfer pricing rules?

Since 2024, Brazil has applied new transfer pricing rules based on the arm’s length principle, aligned with OECD standards (Law No. 14,596/2023). Transactions between related parties in Brazil and abroad, such as intercompany loans, services, royalties and the purchase and sale of goods, must follow market conditions and be properly documented. Groups that operated under the old Brazilian rules need to review their policies.

Can a company in Brazil recover taxes it has overpaid?

Yes. Brazilian law allows companies to recover taxes paid unduly or in excess over the last five years, adjusted by the Selic rate, through refund or offset against future taxes. These credits often arise from calculation errors, inadequate tax regimes or court decisions excluding amounts from tax bases. A tax review frequently reveals opportunities that were never claimed.

What should a company do after receiving a tax assessment in Brazil?

The first step is not to miss the deadline. As a rule, the company has 30 days to file an administrative defense against a federal tax assessment, and during this period it may also be entitled to a reduction of the fine. Many assessments contain calculation, legal or procedural flaws that can reduce or cancel the charge, so the defense strategy defined in the first days is decisive.

Does Barank work with foreign companies and investors?

Yes. Barank Advogados is a business and tax law firm based in Maringá, Paraná, that advises Brazilian and foreign companies throughout Brazil, with services in English, Portuguese and French.

Doing business in Brazil or planning to invest? Contact the Barank Advogados tax team.