Tax avoidance.
The taxpayer’s right to organize their affairs.

Tax avoidance × Tax evasion × Aggressive planning

Tax avoidance (lawful)

Tax saving obtained by choosing among the alternatives the law offers. Before the taxable event. No simulation, no fraud. It is a right.

Example: opting for Presumed Profit instead of Actual Profit when the operating margin is high.

Tax evasion (unlawful)

Saving obtained through concealment, fraud, simulation or the hiding of facts. After the taxable event. It is a crime under Law 8.137/90 — it triggers criminal liability in addition to tax liability.

Example: issuing an under-invoiced tax document to reduce the taxable base.

Aggressive planning (grey area)

Operations that are formally lawful but have very little business purpose, created exclusively to reduce tax. The CARF and the STJ have been striking down such structures.

Example: setting up an offshore vehicle company with no real operation, solely to concentrate profit.

Limits in case law

The CARF has consolidated decisions on disregarded operations: internal goodwill, planning with vehicle companies lacking substance, the artificial segregation of activities to fit a more favorable regime. The line separating lawful tax avoidance from disregarded planning runs through three tests:

1. Substance over form — does the operation have economic reality or is it merely formal?
2. Business purpose — is there a relevant business motivation beyond the tax saving?
3. Timeliness — is the structure established with reasonable advance notice or assembled on the eve of the taxable event?

General anti-avoidance rule (CTN art. 116, sole paragraph)

The sole paragraph of art. 116 of the CTN authorizes the Federal Revenue Service to disregard dissimulating acts. Although not regulated by specific legislation, it is applied by analogy in CARF precedents.

Common tax avoidance strategies

1. Asset-holding companies

Concentrating real estate and equity interests in a legal entity — saving on IRPF on rent, succession-related ITCMD, and asset protection. See Tax Planning.

2. Corporate reorganization

Spin-off, merger, incorporation to isolate activities, separate risks, optimize the tax regime. Always with a documented business purpose.

3. Choice of tax regime

An annual decision among Simples, Presumed Profit and Actual Profit. It can cut the tax burden by 5-10 percentage points.

4. JCP (Interest on Equity)

Distributing profit as interest — deductible for the company, taxed at 15% withholding income tax for the partner. A typical net gain of 19 percentage points.

5. Recovery of late-claimed credits

Taking advantage of tax credits up to 5 years retroactively — STF Theme 69, STJ Theme 779, STF Theme 163. See Tax Planning.

6. Estate succession

Progressive gifting of quotas, reservation of usufruct, VGBL. It reduces ITCMD and avoids judicial probate.

Practical test: does the structure “survive an audit”?

A practical test to distinguish lawful tax avoidance from aggressive planning: does the structure have real business reasons? Family succession, separation of assets, raising investment, governance, risk isolation?

Structures with a real business reason survive an audit even if the tax saving is significant. Structures with a purely tax-driven reason are struck down.

Guiding principle

“Tax saving is a consequence, not the sole motivation.”

When the structuring is proposed solely to reduce tax, with no other defensible reason — we recommend not doing it. The risk of being struck down outweighs the benefit.