• Service: Tax, Global Transfer Pricing Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 8/6/2013

Brazil - Interest rates, “spread” margin on related-party loans 

August 6:  New guidance from the Ministry of Finance establishes the “spread” margin with respect to interest rates applicable on loans between related parties (and therefore subject to Brazil’s transfer pricing rules).


Loan agreements between related parties are subject to Brazil’s transfer pricing rules (regardless of whether the loan is registered with the Central Bank).

Effective 1 January 2013, provisions in Law 12.766/2012 set forth the rates of interest to be used for testing the deductibility of interest expenses, and with the interest income recognition being divided into three different categories, and classified according to the interest rate and currency listed in the loan transaction agreement.

Law 12.766/2012 also established that the "spread" margin would be determined by the Minister of Finance.

Guidance establishing “spread” margin

Ministry of Finance (MF) Ordinance 427/2013 (2 August 2013) establishes the “spread” margin to be added to interest rates on loans between related parties, as follows:

  • For the purpose of deductibility—3.5% applicable from 1 January 2013
  • For the purpose of recognition of minimum income—
  • 0% applicable from 1 January 2013 though 2 August 2013
  • 2.5% applicable from 2 August 2013

For more information, contact a transfer pricing professional with KPMG in Brazil:

Marienne Coutinho

+55 11 2183-3182

Eliete Ribeiro

+55 11 2183-3288

Henrique Conti

+55 11 2183-3278

Evandro Tiba

+55 11 2183-1824

Ricardo Roa

+55 11 2183-6596

Edson Costa

+55 11 3138-5313

Or contact a tax professional with KPMG's Global Transfer Pricing Services.

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