Listed companies steer clear of stock bonuses amid new tax uncertainty
Camila Bacellar
Divulgação
The possibility that stock bonuses could be taxed is opening a new front for disputes among publicly traded companies—one likely to end up in the courts. The uncertainty stems from the 10% withholding income tax (IRRF) that Law 15270 of 2025 imposes on profits and dividends exceeding R$50,000, and it has already led companies to shy away from the practice this year, according to experts consulted by Valor.
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Companies typically use stock bonuses to reward shareholders: retained earnings are capitalized and new shares are distributed free of charge, with no cash outlay or additional contribution required from shareholders.
The mechanism appears to have fallen out of favor since questions arose over how it would be taxed. The new law makes no explicit mention of stock bonuses, but the Federal Revenue Service’s Questions and Answers—High-Income Taxation: Considerations on Profits and Dividends, published in late 2025, leaves the door open to taxation.
The tax authority states that “the capitalization of profits constitutes an ‘application’ of profits, which is one of the events provided for under Article 10, Paragraph 4, of the law that triggers income tax,” adding that this “generally results in the taxation of profits and dividends at a 10% rate.”
Camila Bacellar, a tax partner at Cescon Barrieu, notes that the taxable event for income tax hinges on the “economic or legal availability” of income—and in the case of stock bonuses, that availability is open to question. In her view, there are grounds to argue that “there was no liquidity in what was received,” which taxpayers could use to challenge any assessment.
Beyond the question of whether a taxable event has even occurred, there’s also the practical matter of how withholding would actually work. Vicente Gioielli, a partner in Cescon Barrieu’s corporate and capital markets practice, says the challenge is that withholding tax on a transaction involving no cash payment would force companies into workarounds that could distort their ownership structure.
“Since this is a withholding tax, what am I supposed to do when I distribute shares? Withhold some of them within the company? If I do that, I dilute the shareholder,” he says—complicated further by the fact that shareholders can be subject to different tax treatments on the same dividend distribution.
Law 15270 sets a 10% tax on dividends for resident individuals who receive more than R$50,000 a month in profits from a single company, and on all profits paid to non-resident shareholders, regardless of amount. Domestic legal entities remain exempt.
Gioielli says the lack of clarity has effectively put these transactions on ice. “No company has carried out a stock bonus this year, because it’s still unclear how to handle this,” he says.
In late May, Camil Alimentos proposed a R$1.39 billion capital increase for its shareholders—without issuing new shares. The funds would come from capitalizing the company’s tax incentive reserve, an equity account, and shareholders approved the measure at a meeting on June 30.
In its original proposal, Camil said that once capitalized, the tax incentive reserve balance would become part of its share capital—potentially paving the way for new shares to be issued, and the ownership structure to shift, down the road.
Valor reached out to Camil to ask why it left a stock bonus out of the initial proposal, mentioning it only as a future possibility. The company declined to comment through its press office.
Despite the market debate, Gil Mendes, a partner at Mattos Filho, believes the Federal Revenue Service has already staked out its position in the Questions and Answers publication. “The understanding is that capitalizing profits—and a stock bonus is nothing more than a form of capitalization—constitutes an ‘application’ of profits, one of the situations expressly listed under Law No. 15,270/2025 as triggering income tax withholding,” he says.
It therefore makes no difference, in the Revenue Service’s view, that the distribution isn’t made in cash, the tax lawyer explains. “The market, broadly speaking, has fallen in line with this interpretation.”
Giancarlo Matarazzo, a tax partner at Pinheiro Neto, points out that the new law defines the taxable event for the 10% dividend withholding tax broadly, covering the “payment, crediting, delivery or application of profits to shareholders”—and he agrees that stock bonuses arising from profit capitalization likely fall within that scope.
He notes that before the 1996 dividend exemption, the law carved out a specific exception excluding stock bonuses from taxation. Law No. 15,270 reintroduced dividend taxation, he says, but did not bring that exception back with it. Matarazzo expects the federal government to issue further clarification by year-end. Valor reached out to the Federal Revenue Service but had not received a response by press time.
Even with the tax authority’s position seemingly clear, Mendes acknowledges there’s a “legitimate legal controversy” to the argument that a stock bonus is “nothing more than an internal balance-sheet movement,” with no real increase in shareholder wealth or economic availability.
Eduardo Flores, a professor at the University of São Paulo’s School of Economics, Business and Accounting (FEA-USP), backs that view. “You’re not talking about an actual financial gain, the way you would be with a dividend distribution. A stock bonus doesn’t create new wealth, and no resources leave the company,” he says.
