Starting a business in
🇧🇷Brazil
Checked November 4, 2026 · How we score
Corporate tax
34%
Top income tax
27.5%
Setup from
$2,000
all-in, first year
Time to form
6 weeks
visit usually needed
Taxes in Brazil
| Corporate income tax | 34% Roughly 34% for general companies (25% IRPJ incl. surtax over BRL 240k/yr, plus 9% CSLL). Small businesses with revenue up to BRL 4.8M can use Simples Nacional (about 4%–33% on gross revenue, all-in), and Lucro Presumido taxes a presumed margin. The indirect tax reform replaces PIS/COFINS/ICMS/ISS with CBS and IBS in phases from 2026 to 2033. |
|---|---|
| Personal income tax (top) | 27.5% Progressive up to 27.5% on employment and self-employment income; since 2026 income up to BRL 5,000/month is exempt and a minimum tax of up to 10% applies to very high earners (over BRL 600k/yr). Residents are taxed on worldwide income. |
| Tax system | Worldwide income |
| Capital gains tax | 15%15% to 22.5% progressive on capital gains (15% up to BRL 5M, rising to 22.5% above BRL 30M); gains on real estate reducible by a statutory discount. |
| Dividend withholding (non-residents) | 10% |
| VAT / GST | 17% |
| Social security | No single VAT: ICMS (state, typically 17%–23%), ISS (municipal, 2%–5% on services), plus federal PIS/COFINS and IPI; the 2026–2033 reform introduces IBS/CBS. Employer payroll charges are about 28%–30%. Law 15.270/2025 reintroduced a 10% dividend withholding for non-residents from 2026 with a mechanism to cap the combined tax at 34%. |
Forming a company in Brazil
| Usual entity | Ltda. (Sociedade Limitada) or S.A. |
|---|---|
| Minimum capital | None |
| Setup cost (all-in) | $2,000–$6,000 |
| Annual running cost | $4,000–$12k |
| Time to incorporate | 6 weeks |
| Form remotely as a foreigner | No |
| Local director required | Yes |
| Local address required | Yes |
| Owners on public register | No |
| Statutory audit for small companies | No |
| Business banking for non-residents | Very hard |
Residency and visas
The digital nomad visa (one year, renewable) requires US$1,500 monthly income or US$18,000 in savings. Investor residence requires BRL 500,000 in real estate or a company in poorer regions (BRL 1M elsewhere), about US$90,000–US$180,000. Foreign shareholders must register the investment with the Central Bank and hold a CPF/CNPJ.
| Digital nomad visa | Digital Nomad Visa (VITEM XIV), $1,500/month income |
|---|---|
| Golden visa | Yes, from $100k |
| Ease of residency for founders | 3/5 (1 = easiest) |
Special tax regimes
Simples Nacional
Simplified single-payment regime for small companies with annual revenue up to BRL 4.8M, merging federal, state and municipal taxes into one monthly payment at about 4%–33% of revenue.
Digital Nomad Visa (VITEM XIV)
One-year renewable visa for remote workers earning US$1,500 per month or holding US$18,000; time spent counts toward tax residency after 183 days.
Dividend withholding (Law 15.270/2025)
From 2026, dividends paid to non-residents face 10% WHT; profits declared before the end of 2025 remain exempt.
Pros and cons
Why founders pick Brazil
- Largest economy in Latin America with 200+ million consumers
- Simples Nacional makes small-business tax predictable
- Digital nomad and investor visas available
- Strong fintech and startup ecosystem (Pix, Nubank)
Watch out for
- One of the most complex tax systems in the world, with high compliance cost
- A resident administrator and CNPJ are required for companies
- 10% dividend withholding for non-residents since 2026
- Currency controls and slow, document-heavy company setup
Best for: Companies selling to Brazilian consumers and businesses · Agribusiness, fintech and e-commerce operators in Latin America · Remote workers on the nomad visa who stay under 183 days
Brazil: common questions
What is the corporate tax rate in Brazil?
The combined federal rate for most companies is about 34% (25% IRPJ plus 9% CSLL). Smaller businesses can pay a single blended rate under Simples Nacional (about 4%–33% of revenue) or use presumed-profit rules. State and municipal consumption taxes such as ICMS and ISS come on top.
Does Brazil tax dividends paid to foreigners?
Yes, since 1 January 2026. Law 15.270/2025 introduced a 10% withholding tax on dividends paid to non-residents, with a credit mechanism so the combined tax of the company and shareholder does not exceed the 34% corporate rate. Profits declared by the end of 2025 stay exempt, and treaty interpretations are still evolving.
Can a foreigner open a company in Brazil remotely?
It is difficult. A Brazilian Ltda. needs a CNPJ tax ID, the foreign investment registered with the Central Bank, and an administrator who is a Brazilian resident or a foreigner with a permanent visa. Most foreigners hire a local law firm and accountant.
How does Brazil's digital nomad visa work?
Remote workers earning US$1,500 monthly, or holding US$18,000 in savings, can apply for a one-year renewable visa. Staying 183 days within 12 months generally makes you a Brazilian tax resident on worldwide income, so plan your stay carefully.
Is Brazil good for starting a business as a foreigner?
It is excellent for selling into the Brazilian market but poor for low-tax, low-effort online businesses. Expect about 34% corporate tax, heavy compliance and monthly filings, so most foreign founders start with a local partner or a service provider.
Sources
- Receita Federal do Brasil
- Banco Central do Brasil: Foreign capital registration
- PwC Worldwide Tax Summaries: Brazil
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Not tax or legal advice. Rates and rules change; we check official sources and update every page, but verify with a licensed adviser in the country before acting. Spotted something out of date? Use the correction form below.