BRAZIL Law and Practice Contributed by: Daniel Zugman and Frederico Bastos, BVZ Advogados | Bastos, Bari, Vilela e Zugman
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ern succession matters or inheritance and gift taxes, their provisions should be taken into account when structuring international wealth and investments, par - ticularly in regard to income taxes. Under Brazilian law, assets located in Brazil remain subject to Brazilian succession rules, including the forced heirship regime, under which at least 50% of the estate must be reserved for forced heirs. Assets located abroad, however, may be governed by the succession laws of the jurisdiction in which they are situated, making coordination among different legal systems essential. In practice, international estate planning commonly combines different planning tools, including Brazil - ian and foreign wills, family holding companies, life - time gifts with retained usufruct, foreign trusts, where applicable, and family governance arrangements. The objective is to ensure that the succession plan oper - ates consistently across all relevant jurisdictions while minimising conflicts of law, parallel probate proceed - ings and unintended tax consequences. The changes introduced by Law No. 14,754/2023 have further increased the need to integrate interna - tional tax and succession planning, particularly where offshore entities and foreign trusts are involved, as these structures are now subject to specific Brazilian tax and reporting rules. 2.3 Forced Heirship Laws Brazil has a forced heirship regime. At least 50% of a deceased person’s estate constitutes the legal reserve ( legítima ) and must be preserved for forced heirs, namely descendants, ascendants and the surviving spouse – depending on the marital property regime. The remaining 50% is the disposable portion, which may be freely allocated by will or through lifetime gifts, provided that the legal reserve is not impaired. Brazilian law generally prohibits succession agree - ments concerning the estate of a living person. Accordingly, prospective heirs cannot validly waive, assign or divide future inheritance rights before the death of the asset owner. Alternative consensual arrangements are therefore limited to lifetime planning structures rather than binding inheritance agreements.
2. Succession 2.1 Cultural Considerations in Succession Planning Family-owned businesses play a central role in the Brazilian economy and, in many cases, constitute a family’s principal asset. Succession planning therefore seeks not only to transfer wealth, but also to ensure business continuity and preserve family harmony across generations. From a cultural perspective, many founders remain reluctant to relinquish control during their lifetime and generally favour a gradual succession process. It is common for ownership interests to be transferred to descendants through lifetime gifts of shares while the founders retain usufruct, voting rights or management powers. This allows the older generation to preserve control, income and day-to-day management while preparing the next generation to assume ownership and, ultimately, leadership of the family business. There is also an increasing focus on family govern - ance, particularly among high-net-worth entrepre - neurial families. Family holding companies, share - holders’ agreements, family protocols, wills and other estate planning tools are commonly used to establish governance, succession and dispute resolution mech - anisms, helping to reduce conflicts among heirs and preserve family wealth over the long term. 2.2 International Planning International succession planning has become increasingly relevant for Brazilian families holding foreign investments, offshore structures, overseas real estate or heirs residing in different jurisdictions. In these cases, succession planning must take into account the tax, succession and private international law rules applicable in each relevant jurisdiction. Brazil maintains a network of double tax treaties, which may reduce instances of double taxation and provide greater legal certainty for cross-border invest - ments. Although these treaties generally do not gov -
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