Income tax (15%) is not levied on capital gains on the transfer of shares of closed equity investment funds in cases of donation to the future successors or heirs (inheritance to necessary heirs – sons, daughters, and spouse), when made by the acquisition value of the shares.
This was the most recent definition by the Federal Revenue Service (IRS), which increases security in the use of closed-end investment funds as an instrument for succession planning in donations made to heirs.
Income tax is only levied on these funds at the time of (i) the sale of the shares, (ii) the final redemption, and (iii) its amortization.
However, in the case of a donation in anticipation of a legitimate donation, it must follow the specific taxation rule, which determines that there will only be income tax on the capital gain if the transfer occurs at market value. But when it occurs at acquisition cost, capital gain does not occur at that moment. Therefore, there is no income tax.
On the other hand, the transfer of quotas through donation can attract the state tax on inheritance and donations (ITCMD), with a rate that can reach 8%, depending on the state.
However, if there is an “international” element, for example: donation made by a Brazilian residing or domiciled abroad of quotas in closed-end funds investing in shares for his legitimate heirs, the ITCMD will not be due, according to a recent STF decision.
In this case, there is neither income tax (15%) nor ITCMD (up to 8%).
These two points are extremely important in the long-term strategy of wealth and succession planning, and should be considered by family offices, corporate investors, private investors, and even wealth holders. These are important aspects, especially for those who want to step up and ensure that the transfer of assets to successors (heirs) takes place more efficiently. Especially at the present time, when tax rules are likely to be modified in the future.
