Brazil Enacts Progressive Inheritance and Gift Tax Rules Effective 2026

Overview

• President Lula sanctioned a complementary law this week that standardizes state inheritance and gift taxation (ITCMD) starting in January 2026.
• States will adopt progressive brackets within federal parameters, with rates required to rise with larger transfers and capped at 8%.
• The tax base moves toward current market values, likely increasing bills for estates with appreciated real estate or company shares.
• Collection follows the decedent’s or donor’s domicile, and assets held abroad can be taxed when the testator or beneficiary resides in Brazil.
• Certain private pension plans receive specific exclusions, while transfers completed before 2026 may remain under existing rules, prompting accelerated planning.