Guide to m&a tax 2021

BRAZIL

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Jurisdiction
Dividends % [1]
Interest % [2]
Royalties % [3]
Footnote Reference
Argentina
0
15
10 / 15
Austria
15
15
10 / 15 / 25
[4]
Belgium
10 / 15
10 / 15
10 / 15 / 20
Canada
15
10 / 15
15 / 25
Chile
10 / 15
15
15
People's Republic of China
15
15
15 / 25
Czech Republic
15
10 / 15
15 / 25
Denmark
25
15
15 / 25
Ecuador
15
15
15 / 25
Finland
10
15
10 / 15 / 25
[4]
France
15
10 / 15
10 / 15 / 25
[4]
Hungary
15
10 / 15
15 / 25
India
15
15
15 / 25
Israel
10 / 15
15
10 / 15
Italy
15
15
15 / 25
Japan
12.5
12.5
12.5 / 15 / 25
[4]
Republic of Korea
10 / 15
10 / 15
10 / 15 / 25
Luxembourg
15 / 25
10 / 15
15 / 25
Mexico
10 / 15
15
10 / 15
Netherlands
15
10 / 15
15 / 25
Norway
15
15
15 / 25
Peru
10 / 15
15
15
Philippines
15 / 25
10 / 15
15 / 25
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BRAZIL__Jurisdiction_Dividends_%_[1]_Interest_%_[2]'>BRAZIL

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Jurisdiction
Dividends % [1]
Interest % [2]
Royalties % [3]
Footnote Reference
Portugal
10 / 15
15
15
Russia
10 / 15
15
15
Slovak Republic
15
10 / 15
15 / 25
South Africa
10 / 15
15
10 / 15
Spain
10 / 15
10 / 15
10 / 15
Sweden
25
25
25
[4]
Trinidad and Tobago
10 / 15
15
15
Turkey
10 / 15
15
10 / 15
Ukraine
10 / 15
15
15
Venezuela
10 / 15
15
15
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BRAZIL

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Footnotes:
1
Dividends - The remittance of dividends from Brazil to abroad is currently not subject to taxation in Brazil, so the tax rate limitation indicated 
above is not considered. Please note that a proposal of tax reform under analysis of the Brazilian Congress may re-introduce the taxation of 
dividends in Brazil. In this case, the tax rate limination provided by the DTTs shall become relevant for discussion. The Double Tax Treaties (DTTs) 
signed between Brazil and other countries generally apply a 10% or 15% rate if the beneficial owner of the funds is a company that directly holds 
a given minimum participation in the company that pays the dividends. For all other cases a 15% or 25% rate would apply.
2
Interest - Most treaties consider the general rate of 15% for interest payments, while a 10% rate is considered for specific loans (e.g. acquisition of 
capital goods with minimum paying term).
3
Royalties - Most DTTs signed between Brazil and other countries limit to 10% the payment of royalties related to the use / right to use 
cinematographic films, films or tapes for television or radio broadcasting, and any copyright of literary, artistic, or scientific work produced by 
a resident of a contracting state. Royalties related to the use / right to use trademarks are generally subject to a 25% (or 15%) rate. The general 
15% (sometimes 10%) is applied for other types of royalties.
4
Currently, the only DTTs signed with Brazil that do not characterize technical services/assistance under the royalties article are: Brazil/Finland 
DTT, Brazil/Austria DTT, Brazil/France DTT, Brazil/Japan DTT, and Brazil/Sweden DTT. This last one was reviewed and the new Protocol, when 
it enters into force, will treat technical services/ assistance under the royalty article. The referred treaties support the understanding that 
withholding income tax (WHT) would not apply on service payments made from a Brazilian source, where no permanent establishment of the 
foreign beneficiary is indentified in Brazil (subject to a specific analysis on a case-by-case basis).
Brazil has recently signed DTTs with Switzerland, Singapore, Uruguai and Paraguay, however these treaties are not yet valid in Brazil. There is no specific
timeline for the treaties to become into force. Remittances to other non-treaty jurisdictions generally have a WHT rate limited to 15%.
Remittances made to tax haven jurisdictions (as per the list provided by the Brazilian tax authorities) have a WHT rate increased to 25%.
TAXAND GLOBAL GUIDE TO M&A TAX 2021
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BRAZIL

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17. APPENDIX II - GENERAL CORPORATE ENTITY TAX DUE DILIGENCE REQUESTS
In other to incorporate and acquire a corporation or any other type of legal entity in Brazil, foreign shareholders must appoint an attorney-in-fact resident in Brazil, 
through the issuance of a power of attorney, duly apostilled in the foreign country and translated by a sworn translator registered by the Brazilian Board of Trade. This 
is the main relevant documentation that a foreign shareholder should provide in order to acquire or incorporate a Brazilian 
Limitada or S/A.
The Brazilian tax authorities have a 5 year statute of limitations period to audit and assess taxpayers in the Country.