Strategies for paying less tax in 2025

With the changes brought about by the Tax Reform, 2025 will be a year of adaptation for entrepreneurs and taxpayers in Brazil. 

Below, we'll explore the main strategies for legally reduce the tax burdenconsidering the new fiscal scenario.

Understand the changes in the Tax Reform

The main change in the reform is the replacement of five consumption taxes with two: the CBS (Contribution on Goods and Services) and the IBS (Goods and Services Tax). CBS will replace PIS, Cofins and IPI, while IBS will unify ICMS and ISS.

The final rates will be defined by a complementary law and will go through a transition phase, being gradually implemented until 2033. In 2025, companies must prepare for the initial phase of adjustments and regulations of the new tax rules, such as the extinction of some ICMS and ISS exceptions.

Choosing the right tax regime

In 2025In the last few years, choosing the right tax regime will be more crucial than ever. The three main tax regimes are:

• Simples NacionalFor micro and small companies, it can still be advantageous due to the simplicity of calculation, but it must be analyzed on a case-by-case basis, especially for businesses with higher profit margins.
• Presumed ProfitIt is best suited to companies with predictable profit margins and turnover of up to R$ 78 million.
• Real ProfitThis regime is more suitable for companies with lower profit margins, high operating costs or when it is possible to offset accumulated losses. Real Profit will benefit from the possibility of using tax credits in the new IBS and CBS system.

Take advantage of tax incentives and credits

Tax incentives continue to be an important strategy for reducing the tax burden. By 2025, benefits such as exemption for biofuels and tax reductions for the basic food basket will be maintainedand incentives for the Manaus Free Trade Zone. In addition, companies should re-evaluate their tax credits, since the new VAT system will allow for more efficient use of credits along the production chain, avoiding "cascading charges".

Cost and expense planning

Effective cost management is key to reducing the tax base. Identify deductible expenses and optimize the allocation of resources, especially in areas such as health, education and investment in innovation, which can generate tax deductions. This also includes the possibility of anticipating or postponing expenses to adjust taxable income.

Pay attention to the new income and wealth tax rules

The Tax Reform brings changes to the progressive taxation of inheritances and donations, The IPVA tax rate will now be stricter, preventing taxpayers from seeking more favorable tax residences for inventory processes. In addition, luxury vehicles such as jets and yachts will be subject to IPVA, and the rates may be progressive, according to the environmental impact.

Read more about: Tax reform: what will change

Selective Tax

A new feature is the Selective Taxnicknamed "sin tax", which will be levied on products such as cigarettes, alcoholic drinks and polluting vehicles. The aim is to discourage the consumption of products that are harmful to health and the environment. Entrepreneurs in the drinks and tobacco sector need to prepare for this additional tax.

Use technology for tax planning

The use of tax and accounting management software will be essential to ensure compliance with the new rules, as well as identifying opportunities for tax reduction. Tools such as Artificial Intelligence and Big Data can help analyze tax data and optimize the use of credits and deductions, as well as automating the tax assessment and payment process.

Seek specialized accounting advice

With the complexity of the changes brought about by the reform, it is crucial to have specialized accounting advice. Trained professionals can help implement tax planning strategies, identify savings opportunities and ensure compliance with the new rules.

Find out more about our solutions: Accounting outsourcing

Conclusion

2025 will bring challenges and opportunities in the tax field, especially for companies that know how to adapt to the new rules. Adopting strategic tax planning, investing in technology and relying on qualified professionals will be key to remaining competitive.

To help your company navigate this new tax scenario, the CLM Controller offers specialized tax management and accounting consultancy services, guaranteeing the best use of legal tax reduction opportunities.