JCP: another effect of dividend distribution | Fio da Meada

As a reminder: companies can remunerate their partners with JCP in a deductible manner when calculating income tax (IRPJ/CSLL). With this, basically, we obtain a saving of 34% of the JCP in the company, in compensation for the tax on the beneficiary of the JCP, at the rate of 15% in 2025 and 17.5% from 2026, according to Complementary Bill No. 128/2025, which awaits presidential sanction. Even with the increase in the JCP tax rate, it remains advantageous for companies and their associates to have these amounts deducted. However, it is necessary to respect the limits set by tax legislation.

Let us also remember that there are three limits to the deductibility of JCPs, namely: the interest rate applied to equity accounts; 50% of accumulated profits or profit reserve; and 50% of the results of the exercises. Thus, the distribution of the “stock” of profits (accumulated and reserves), as a means of avoiding minimum income tax (“high income”) up to 10%, has effects on two of these limits: on the basis of JCP (net equity) and within the limit of 50% of accumulated profits or profit reserve.

In other words, the decision to distribute the entire “stock” of profits (accumulated and reserves) transfers the values ​​​​of equity to liabilities (we understand that they are not current). This, on the one hand, significantly reduces the net worth of the company, on which the interest rate will be applied to calculate the JCP. On the other hand, the company will only rely on the results of the year to determine the 50% limit, because the accumulated profits and profit reserves accounts will have a zero balance.

This is yet another effect to consider, prospectively, when evaluating the dividend distribution decision based on earnings “stock”.