The new law expands the scope Exemption to discount to income tax For those who receive Up to 5 thousand Brazilian reals Monthly approved by the President Luiz Inacio Lula da Silva (PT) Wednesday (26).
The new rules do not take effect immediately. In other words, workers won’t see a difference in their net pay until the end of 2025. Changes begin January 1, 2026.
The new IR rules eliminate taxes for those who earn up to R$5,000 per month and provide discounts on tax rates for those who earn between R$5,000 and R$7,350 per month, in a tiered manner. For those who earn more, nothing changes.
In practice, this means that there will now be two income tax schedules from 2026 onwards: for those earning up to R$7,350 and for those earning above that (which continues to apply to the schedule that already exists).
For those earning up to R$7,350
- Who gets up to R $ 5,000: Complete exemption; You will have annual savings of R$ 4,356.89
- Who gets up to R $ 5,500: 75% discount; You will have annual savings of R$ 3,367.68
- Who gets up to R$6,000: 50% discount; You will have annual savings of R$ 2,350.79
- Who gets up to R$6,500: 25% discount; You will have annual savings of R$ 1,333.90
- Who receives up to R$ 7,350: You will have annual savings of up to R$ 605.86
New income tax table for 2026 (for those earning up to R$ 7,350)
| Salary range | What will be applied? | Annual savings (estimated) |
| Up to R$5,000 | Complete exemption | 4,356.89 Brazilian reals |
| Up to R$ 5,500 | 75% discount | 3,367.68 Brazilian reals |
| Up to R$6,000 | 50% discount | 2,350.79 Brazilian reals |
| Up to R$ 6,500 | 25% discount | 2,350.79 Brazilian reals |
| From R$ 7,350 | There is no discount | – |
For those earning from R$ 7,351
No changes are expected in income tax for those earning more than R$7,350. In other words, for these people, the rates remain the same as they are today, without increasing.
General income tax table (for those who receive more than R$ 7,350)
| Salary range | Basis of calculation | Aliquot |
| Up to R$ 3,036 | Up to 2,238.80 | – |
| From R$3,036 to R$3,353.31 | 2,428.81 Brazilian Reals to 2,826.65 Brazilian Reals | 7.5% |
| From R$ 3,353.31 to R$ 4,688.85 | 2,826.66 Brazilian Reals to 3,751.05 Brazilian Reals | 15% |
| From R$4,688.85 to R$5,830.85 | 3,751.06 Brazilian Reals to 4,664.68 Brazilian Reals | 22.5% |
| Higher than R $ 5,830.85 | Higher than R $ 4,684.68 | 27.5% |
How to calculate IR deduction in 2026?
- The value calculator shows how much you would stop paying without income tax
To calculate income tax, you must take into account IR tables based on your gross monthly salary (see above).
- Up to 5 thousand Brazilian reals Exempt from gross monthly income
- Between R$5,001 and R$7,350The progressive discount calculation is as follows: BRL 978.62 – (0.133145 x taxable income)
- From R$ 7,351 The same IR schedule continues to apply this year (see above)