Stock Options and RSUs in Brazil: Tax, Social Security and Labor Rules for Foreign Parent Plans

Many multinational groups grant stock options, restricted stock units (RSUs) or similar awards over the parent company’s shares to employees of their Brazilian subsidiary. The plan is usually designed abroad, administered by a global provider and governed by foreign law. Brazil, however, has its own answers to three questions: is the benefit taxed as salary, does it attract social security contributions, and how is the employee taxed when selling the shares? After years of disputes, the courts settled much of the debate on stock options between 2024 and 2026. RSUs remain less clear. This guide explains where things stand.

Stock options: the STJ settled the income tax question

In September 2024, the Superior Court of Justice (STJ) decided Theme 1226 under the repetitive appeals procedure, which binds lower courts. For stock option plans under article 168, paragraph 3, of the Corporations Law (Law 6,404/1976), the court held that:

• the plans have a commercial nature, not a remuneration nature;
• no individual income tax arises when the employee acquires the shares by exercising the option, because there is no increase in wealth at that point;
• income tax applies when the employee sells the shares with a gain.

The decision became final in 2026. It rests on features of a genuine option plan: the employee pays to exercise, chooses whether to participate and bears the market risk. Plans that guarantee a gain or pay a discount regardless of performance may not fit the same reasoning.

Social security: Theme 1379

The social security side was decided by the STJ on October 14, 2026, in Theme 1379. According to reports of the unanimous judgment, the court applied the same commercial-nature reasoning and ruled out employer social security contributions and third-party contributions on the exercise of options under stock option plans. The judgment had not yet been published when this guide was updated, so the final wording of the thesis should be checked. Before this decision, the administrative tax court (CARF) was divided, and many companies have past assessments under discussion.

RSUs and free share awards: less settled

Neither decision addresses RSUs. The reasoning of Theme 1226 depends on the employee paying for the shares, choosing to participate and taking risk. An RSU usually delivers shares free of charge when service conditions are met, which looks more like a reward for work. There is no binding decision applying Theme 1226 to RSUs, and groups should not assume the same treatment. The risk is that the value of the shares delivered at vesting is treated as employment income, subject to monthly income tax and social security.

Each plan should be analyzed on its terms: whether the employee pays anything, whether participation is voluntary, how vesting works, who grants the award and whether the Brazilian subsidiary bears the cost.

Selling the parent’s shares: 15% under Law 14,754/2023

Shares of a foreign parent company held by a Brazilian tax resident are treated as an investment abroad. Since 2024, under Law 14,754/2023, gains on the sale of shares of foreign entities that the individual does not control are taxed at 15%, calculated in the annual tax return, separately from other income and without deductions. The small-sales exemption that applies to Brazilian shares does not apply to these gains, according to the Federal Revenue.

Employees who become Brazilian tax residents during an assignment, or leave the country, need to track the cost basis of their shares and the date of residence (see expatriate tax in Brazil). High earners should also consider the minimum income tax on annual income above R$600,000 introduced by Law 15,270/2025 from 2026, whose base includes income taxed separately.

The Brazilian subsidiary’s side

Accounting

Share-based payments are recognized under CPC 10 (R1), equivalent to IFRS 2, including when another group company grants the award to the subsidiary’s employees. The subsidiary records the expense of the services received, usually against equity, or against a liability if it must reimburse the parent.

Corporate income tax deduction

Under Law 12,973/2014 (article 33), the expense booked for share-based payments is added back to taxable profit when recognized. It becomes deductible only after payment, for awards settled in cash, or after the definitive transfer of the shares or options, for awards settled in equity, and limited to the amount paid or recognized in equity.

Recharges from the parent

Many groups recharge the cost of awards to the Brazilian subsidiary. A recharge is a payment abroad, and its tax treatment, deductibility and the taxes due on the remittance depend on how the agreement is structured. It should be reviewed before the first payment, together with transfer pricing (see intercompany transactions in Brazil).

A checklist for HR and tax teams

1. Classify each plan: option with an exercise price, RSU, free share award, phantom shares or cash bonus linked to share price.
2. Check the Brazilian features of option plans: voluntary participation, exercise price paid by the employee and market risk.
3. For RSUs and free awards, assess the employment income risk and the payroll treatment before vesting events in Brazil.
4. Decide whether the subsidiary will reimburse the parent, and document the recharge.
5. Tell employees how the 15% tax on foreign share sales works in their annual return.
6. Keep records of grants, exercises, vesting and sales for each Brazilian employee.

How Solidy can help

Solidy already serves subsidiaries of multinational companies in Brazil. Our payroll and tax teams review equity plans for Brazilian employees, define the payroll and reporting treatment, book the share-based payment expense and its tax adjustments, and support employees’ annual returns. See our payroll service or talk to our consultants.