The time has come to plan to pay less income tax; understand – 10/28/2023 – From Grain to Grain

This is the ideal time to plan to reimburse part of what you paid in Income Tax (IR) this year. There are only two months left until the end of the year and with it, also the time to use this benefit. Like all benefits, it is not available to everyone. I explain below who is eligible and how you can plan to use it.

This tax advantage is achieved by contributing to a PGBL type supplementary pension plan. However, the benefit is not just tax.

At this point, I will focus on this tax aspect. In it, there are three major benefits of contributing to a PGBL-type plan: postponing the payment of IR, earning income on this postponed IR and paying less IR in the future.

There are also other benefits, for example, absence of “share fees”, reduction of succession costs, improved retirement planning and absence of taxes on portability. However, I will focus on the three tax aspects mentioned above, as they are exclusive to PGBL type products.

It is worth mentioning that the application of this product is only advantageous for individuals who declare their income tax under the full regime.

However, don’t worry if it doesn’t suit you, as that means you have another benefit. Sometimes even bigger. I explain better.

When making the annual Income Tax declaration, there are two options: the simplified discount or the complete declaration.

In the simplified discount, the taxpayer replaces all permitted deductions with a deduction of 20% of the value of taxable income, limited to R$16,754.34. Allowed deductions are, for example, contributions to pension plans, health, education and dependent expenses, among others.

Therefore, if you have taxed income of up to R$83,771.7 per year, you probably do not qualify to use the PGBL benefit. Those who do not contribute to the INSS (or to their own regime) also do not qualify, unless they are already retired.

If your income is higher than the amount above, you begin to qualify.

The deduction allowed for PGBL private pension contributions is limited to 12% of taxable income for the year.

But be careful, because just because you paid IR does not mean you can take advantage of the advantage. If you are a businessman and your income is primarily from dividends from your company’s profits, you are not entitled to use this benefit.

To calculate taxable income, you must consider, in addition to other sources of income, such as property rentals, income from work, excluding from the latter gains relating to profit sharing.

The advantage of applying PGBL, when considering the postponement and reduction of IR, multiplies over time. In a simulation, your application in PGBL can represent an increase in your salary of between 10% and 20% due to the income tax savings achieved.

As there are two months left until the end of the year, you can plan this application by making a greater saving effort at this time or using your 13^O wage. To do this, you have to plan now.

Don’t run the risk of missing out on this potential salary increase by leaving planning until the last minute.

Michael Viriato is an investment advisor and founding partner of Investor’s House.

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