Income Tax Table 2026: New Rates and Exemption Ranges

The 2026 Income Tax table brought important changes that directly impact Brazilian workers’ pockets. The new rates and exemption ranges have significantly altered IR calculations for different types of income.

For millions of taxpayers, these modifications represent an opportunity to reduce their tax burden or, in some cases, an increase in monthly deductions. Understanding the new rules is fundamental for efficient tax planning.

2026 IR Table

Updated tax brackets

The 2026 IR progressive table establishes five tax brackets based on monthly income. Each bracket has a specific rate and a fixed deduction that reduces the final tax amount.

Rates and deductions by bracket

The progressive system means you only pay taxes on the portion of income that exceeds each bracket. Each bracket’s fixed deduction automatically reduces the calculated amount.

Practical example: Salary of R$ 4,000.00

• Calculation base: R$ 4,000.00 (4th bracket)
• Calculation: R$ 4,000.00 × 22.5% = R$ 900.00
• Minus deduction: R$ 900.00 - R$ 662.77 = R$ 237.23 IR

The exemption bracket was expanded to R$ 2,259.20, benefiting workers with monthly income up to this amount. This represents a significant increase compared to previous years.

How to Calculate Withholding Tax

Progressive calculation method

IR calculation follows the progressive method, where each income bracket has its rate applied only to the amount exceeding the lower limit. This system ensures that higher earners pay proportionally more taxes.

To calculate correctly, you need to:

• Identify your gross salary’s income bracket
• Apply the corresponding rate
• Subtract the bracket’s fixed deduction
• Deduct legally permitted deductions

Permitted deductions

The main deductions that reduce the IR calculation base include:

• Dependents: R$ 189.59 per dependent
• Alimony: full amount paid
• Social security contribution: INSS (social security) deducted from payroll
• Health insurance: amounts paid for holder and dependents
• Education: up to R$ 3,561.50 per person (holder + dependents)

Important tip: Use our income tax calculator to simulate different scenarios and optimize your deductions.

Key Changes for 2026

Changes in exemption bracket

The main novelty for 2026 was increasing the exemption bracket from R$ 1,903.98 to R$ 2,259.20. This change directly benefits workers earning up to two minimum wages.

It’s estimated that approximately 12 million taxpayers were removed from IR collection with this change. For those already paying tax, there was a reduction in the monthly amount deducted.

New deduction amounts

Fixed deductions per bracket were also adjusted, resulting in lower tax impact for most taxpayers. The fifth bracket had the largest deduction adjustment, increasing from R$ 713.58 to R$ 896.00.

These adjustments represent average savings of R$ 50 to R$ 150 monthly for workers in intermediate income brackets.

IR for Different Types of Income

CLT (labor law) Salary

CLT workers have IR automatically deducted from their payroll. The calculation considers gross salary minus social security contributions and other legal deductions.

For those receiving 13th salary, the calculation follows specific rules:

• First installment: IR exempt
• Second installment: normal taxation on net amount
• Possibility of refund if excessive collection occurred

Self-employed and Legal Entities

Self-employed professionals and legal entities opting for Presumed Profit need to calculate and collect IR monthly through DARF.

Rates vary according to activity type:

• Service provision: 1.6% on revenue
• Commerce and industry: 1.2% on revenue
• Cargo transportation: 1.2% on revenue
• Specific activities: up to 4.8% on revenue

MEIs (micro-entrepreneurs) remain exempt from IR on revenue, provided they respect the annual limit of R$ 81,000.00.

Strategies to Reduce IR

Maximize legal deductions

The first strategy is to take full advantage of all permitted deductions:

• Keep receipts for medical and educational expenses
• Consider family health insurance to increase deductions
• Evaluate the advantage of declaring eligible dependents
• Organize alimony payment documents

Pension planning

Private pension contributions (PGBL) are deductible up to 11% of taxable income. For high earners, this strategy can generate significant savings.

Example: Annual income of R$ 120,000

• PGBL contribution: R$ 13,200 (11%)
• IR savings: approximately R$ 3,630 annually

Tax-exempt investments

Diversify part of investments into IR-exempt categories:

• LCI and LCA: exempt for individuals
• Small bank CDBs: up to R$ 20 million protected by FGC
• IPCA+ Treasury: real return without taxation until maturity
• Real estate funds: exempt monthly distributions

Deductible donations

Donations to qualified entities can be deducted up to 6% of IR due:

• Funds controlled by Children’s Rights Councils
• Cultural Support Programs (Rouanet Law)
• Audiovisual Activity Programs
• Elderly Funds

This strategy allows tax reduction while contributing to important social causes.

Frequently Asked Questions

What is the IR exemption bracket value for 2026?

The IR exemption bracket for 2026 is R$ 2,259.20 monthly. Those earning up to this amount are exempt from withholding Income Tax.

How do I calculate IR deduction on my salary?

To calculate your salary’s IR, identify your tax bracket in the table, apply the corresponding rate, and subtract the fixed deduction. Also consider deductions for dependents (R$ 189.59 each) and social security contributions.

Can I deduct education expenses in 2026 IR?

Yes, education expenses are deductible up to R$ 3,561.50 annually per person (holder and each dependent). This includes school tuition, technical courses, higher education, and graduate programs.

Do MEIs pay Income Tax on revenue?

MEIs are exempt from IR on revenue, provided they don’t exceed the annual limit of R$ 81,000.00. However, if they have other taxable income above R$ 2,259.20 monthly, they must file normally.

When should I file the 2026 IR return?

The 2026 IR return (2025 calendar year) will be filed between March and May 2026. Those required to file include anyone with annual taxable income above R$ 30,639.90 or who meets other specific situations.

Are health insurance premiums fully deductible from IR?

Yes, health insurance expenses for yourself, spouse, and dependents are 100% deductible from IR, with no amount limit. Keep all payment receipts organized.

How does IR work on the 13th salary?

The 13th salary has differentiated taxation: the first installment is exempt, and the second installment has IR deducted calculated on the net amount. The calculation considers accumulated annual income, potentially generating refund rights.