Wealth planning in Brazil has been hampered by uncertainties surrounding tax reform.
After all, uncertainty surrounding the new rules for taxing inheritances, donations, and corporate reorganizations, combined with the progress of the bill proposing to tax dividends and adjustments to income tax, has led many business families to postpone their estate planning projects, creating discomfort when making significant corporate moves.
However, managing your assets without strategic and effective planning can pose an even greater risk. Effective wealth planning is, at its core, a governance and asset management project, not just an assessment to obtain tax benefits. Most of the fundamental work to protect and optimize your legacy can be done regardless of tax reform. Postponing these actions means concentrating risks and missing the opportunity for a structured, cost-controlled transition.
We highlight here the main steps that can be taken now, enabling efficiency and achieving the best results for your Brazilian wealth planning:
1. Asset Diagnosis: consolidation of all assets and liabilities (personal and business), not as a simple list, but with a strategic analysis, including identifying the need to split assets to obtain better governance.
2. Governance and Succession Alignment: Aligning objectives is essential in Brazilian wealth planning, especially when it comes to succession or in the case of family businesses, where more than one family member needs to reach a consensus on what will be done. This is the time to define and formalize the future vision for the assets and the company. Drafting partnership agreements, family protocols, and succession guidelines ensures the business’s sustainability, prevents conflicts between heirs, and establishes clear rules for decision-making, protecting the company from future disputes.
3. Optimizing the Corporate Structure: How assets are allocated directly impacts their protection and tax efficiency. The implementation of a Patrimonial or Family Holding Company, for example, is a structural decision. In Brazil, it can centralize control, optimize asset management, facilitate the succession process, and enable a less costly succession.
Postponing wealth planning until tax reform is fully defined means handing over control of your legacy to external factors. The steps of asset assessment, governance alignment, and corporate structuring are management decisions that strengthen your position today. Implementing them now means taking time and analyzing decisions, reducing the likelihood of costly mistakes and family disputes that could destabilize the company. When the new tax rules are published, your structure will already be organized and ready for a final, quick, and cost-effective adaptation.
