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PIS and COFINS: Brazil's federal turnover contributions

Last verified: 2026-10-25

PIS and COFINS are federal contributions on gross revenue. In the non-cumulative regime, mandatory for actual profit companies, rates are 1.65% and 7.6% (9.25% combined) with input credits; in the cumulative regime, used by presumed profit companies, they are 0.65% and 3% (3.65%) with no credits. Both are scheduled to be extinguished in 2027 and replaced by the CBS.

The rule

1. Non-cumulative PIS is 1.65% of the revenue base.Law 10,637/2002, art. 2, 2002-12-30 official text
2. Non-cumulative COFINS is 7.6% of the revenue base.Law 10,833/2003, art. 2, 2003-12-29 official text
3. Companies taxed on presumed or arbitrated profit, among others, stay in the cumulative regime.Law 10,833/2003, art. 10, item II, 2003-12-29 official text
4. Cumulative PIS is 0.65% of revenue.Law 9,715/1998, art. 8, item I, 1998-11-25 official text
5. Cumulative COFINS is 3%.Law 9,718/1998, art. 8, 1998-11-27 official text
6. On imports of goods the general rates are 2.1% PIS import and 9.65% COFINS import; on imported services 1.65% and 7.6%.Law 10,865/2004, art. 8, items I and II, 2004-04-30 official text
7. From 2027 the CBS is charged and PIS and COFINS are extinguished, provided the CBS has been instituted.Constitutional Amendment 132/2023, art. 126 ADCT (inserted by art. 2), 2023-12-20 official text
8. In 2026, CBS at 0.9% and IBS at 0.1% are offset against PIS and COFINS due, and payment of CBS and IBS is waived for taxpayers who meet the ancillary obligations; those taxpayers still pay PIS and COFINS in full.Complementary Law 214/2025, art. 348, 2025-01-16 official text

Worked example

Actual profit company with BRL 10,000,000 of taxable revenue (about USD 1,985,033) and BRL 6,000,000 of creditable inputs. Debits at 9.25%: BRL 925,000. Credits at 9.25%: BRL 555,000. Net PIS and COFINS: BRL 370,000 (about USD 73,446). A presumed profit company with the same revenue pays 3.65% with no credits: BRL 365,000 (about USD 72,454). USD at the BCB PTAX selling rate of 23 October 2026, BRL 5.0377 per USD.

Step by step

  1. Determine the regime from the income tax election: actual profit generally means non-cumulative, presumed profit means cumulative, subject to the exceptions in Law 10,833 art. 10.
  2. Map creditable inputs carefully; the concept of input has been heavily litigated.
  3. Check for single phase, zero rate or specific regimes for your products before using the general rates.
  4. Prepare systems for the CBS: 2026 invoices must already report CBS and IBS fields.

Common traps

  • Assuming the 9.25% regime is always worse: with high creditable inputs it can beat the 3.65% cumulative rate.
  • Forgetting PIS and COFINS import on services, which are often missed in intercompany charges.
  • Ignoring that LC 224/2025 cut many federal PIS and COFINS benefits by 10% from April 2026.

Sources

Related pages

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