On August 29, 2025, Brazil issued proposed amendments to Normative Instruction No. 2,228 to take account of the June 2024 OECD Administrative Guidance and other sundry amendments.
The general text that accompanies the issue of the amended Normative Instruction provides that no amendments were needed for the January 2025 OECD Administrative Guidance.
The proposed amendments in the draft law will generally apply for tax years beginning after January, 2025. However, a number of the amendments are to apply from January 1, 2026 with an option to apply them from January 1, 2025.
Proposed Amendments in the 2025 Draft Law
| Fourth Set of OECD Administrative Guidance (Article) | Rule | Implementation in Brazil | Effective From |
|---|---|---|---|
| 1.2.1 | Aggregate DTL Category basis | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.1 | Exclusion of certain types of GL accounts and separate tracking | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.1 | Exclusion of GL accounts that generate standalone DTAs | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.1 | Exclusion of swinging accounts and separate tracking | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.2 | FIFO/LIFO Basis | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.3 | Aggregation of Short-term DTLs | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.2 | Reversal of DTLs that accrued before the Transition Year | August 2025 Draft Amendments – Articles 52A-52G | January 1, 2025 |
| 1.2.2 | 5 year unclaimed accrual election | August 2025 Draft Amendments – Article 53A | January 1, 2025 |
| 2.1.2 | Recalculated deferred tax where GloBE carrying value differs from accounting carrying value | August 2025 Draft Amendments – Article 50A | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 2.1.2 | GloBE and accounting carrying values and the Transition Rules | August 2025 Draft Amendments – Article 78 | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 2.1.2 | Exclusion of GloBE carrying value from SBIE | August 2025 Draft Amendments – Article 78 | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 3.1.3 | General rules for allocating cross-border, current taxes under a cross-crediting corporate tax system: 4 Steps | August 2025 Draft Amendments – Articles 48A-48F | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 3.1.3 | Specific rules for foreign PEs/CFCs, Hybrids/rev hybrids with domestic source income | August 2025 Draft Amendments – Articles 48A-48F | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 3.1.3 | Cross-crediting between Permanent Establishments and distributions from foreign subsidiaries | August 2025 Draft Amendments – Articles 48A-48F | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 4.1 | Extension of the Substitute Loss Carry-forward DTA to PEs, hybrids and rev hybrids | August 2025 Draft Amendments – Article 49 | January 1, 2025 |
| 4.2 | Allocation of deferred tax expenses and benefits from a Parent Entity to a CFC, PE Hybrid or Rev Hybrid: 5 step process | August 2025 Draft Amendments – Articles 47(7)/49 | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.2.2 | Determining GloBE status when a Flow-through Entity is held directly by another Flow-through Entity | August 2025 Draft Amendments – Articles 29A-29E | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.3.2 | Non-group owners: Partially owned Flow-through Entities | August 2025 Draft Amendments – Articles 29A-29E | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.3.5 | Non-group owners: Indirect minority ownership | August 2025 Draft Amendments – Articles 29A-29E | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.4.2 | Taxes allocated to a flow-through entity | August 2025 Draft Amendments – Articles 29A-29E | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.5.2 | Hybrid entities – Taxes pushed down include indirect owners | August 2025 Draft Amendments – Articles 29A-29E | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.5.4 | Hybrid entities – Entities located in jurisdictions without a Corporate Income Tax system | August 2025 Draft Amendments – Article 31A | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 5.6.2 | Extension of taxes pushed down to include Reverse Hybrids | August 2025 Draft Amendments – Article 47 | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 6.1.4 | Option to not impose top-up tax liabilities on SPVs used in securitization transactions | August 2025 Draft Amendments – Article 89A | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 6.1.4 | New definition: Securitization Entity | August 2025 Draft Amendments – Article 89B | January 1, 2026 but subject to an option to apply from January 1, 2025 |
| 6.1.4 | New definition: Securitization Arrangement | August 2025 Draft Amendments – Article 89B | January 1, 2026 but subject to an option to apply from January 1, 2025 |
For detailed information on the application of the GloBE Rules in Brazil, see our:
OECD Administrative Guidance: Domestic Implementation Matrix
Transitional CbCR Safe Harbour: Domestic Implementation Matrix
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