Annual Accounts Approval for Foreign-Owned Ltdas: The April Deadline

Reviewed by Luiz Eduardo da Silva, director of LegalBR. Updated on 22 October 2026. About 10 minutes to read.

The annual accounts approval in Brazil is due within four months after the fiscal year ends, which means by 30 April for most Ltdas and S.A.s. For foreign-owned subsidiaries, the April resolution now matters more than ever: since January 2026, dividends paid abroad bear a 10% withholding tax, so the minute that approves the accounts and declares dividends has direct tax consequences. This guide walks through quorums, proxies, remote meetings, filing and the dividend resolution, with a calendar you can reuse.

What the annual accounts approval in Brazil covers

Under article 1,078 of the Civil Code, the partners of a limited company (Ltda) meet at least once a year, within four months after the end of the fiscal year, to:

• review the administrators’ accounts and resolve on the balance sheet and the income statement;
• appoint administrators, when applicable;
• deal with any other matter on the agenda.

Corporations (S.A.) follow a parallel rule: the annual shareholders’ meeting (assembleia geral ordinária) takes place within the same four months, under article 132 of Law 6,404/1976. For a calendar-year company, both deadlines fall on 30 April. In practice, the meeting also allocates the year’s net profit, which is where dividends come in. Our corporate compliance calendar shows how this date fits into the rest of the year.

How a Ltda approves its accounts

A Ltda can approve its accounts in three formats. The choice depends on the number of partners and on what the articles say.

Most foreign-owned subsidiaries have two group partners, so the written resolution signed by both is usually the simplest route. When a meeting is held, the Civil Code sets these rules, unless the articles validly provide otherwise:

• Documents in advance: the balance sheet and income statement must be made available, with proof of receipt, to partners who are not administrators at least 30 days before the meeting.
• Installation: the assembly opens on first call with partners holding at least three quarters of the capital, and on second call with any number.
• Approval: the accounts are approved by a majority of the votes of those present. Law 14,451/2022 lowered other Ltda quorums but not this one.
• Conflict: no partner may vote, directly or as a proxy, on a matter that concerns that partner directly, such as the partner-administrator’s own accounts.
• Effect: approval of the balance sheet and income statement without reservation discharges the administrators, except in case of error, fraud or simulation; the right to annul it expires after two years.

What changes for an S.A.

A closed S.A. follows Law 6,404/1976. The management report, financial statements and, where applicable, the independent auditor’s opinion must be available to shareholders at least one month before the annual meeting. The company must also publish its financial statements: closed companies with annual gross revenue up to R$ 78 million may do it electronically through the SPED Balance Sheet Center, while larger ones publish an abridged version in a large-circulation newspaper with the full text on its website.

The S.A. also allocates profit under stricter rules, including the legal reserve and, when the bylaws are silent, the mandatory dividend for companies outside the simplified regime. If administrators delay the call by more than 60 days, any shareholder may call the meeting. Finally, the minutes go into the shareholders’ meeting minutes book, a separate set of corporate books from those of a Ltda.

Foreign quotaholders: proxies and remote meetings

A foreign parent participates through its legal representative or an attorney-in-fact in Brazil. Under article 1,074 of the Civil Code, a Ltda partner may also be represented by another partner or by a lawyer, under a power of attorney that specifies the authorized acts; that instrument is filed with the minutes.

Remote participation is also available. Since 2020, the Civil Code (article 1,080-A) and the corporations law (article 121) allow partners and shareholders to attend and vote at a distance. The federal registration department’s rules, first issued as IN DREI 79/2020, distinguish two formats:

• Hybrid (semipresencial): partners may attend in person at the venue or take part remotely.
• Digital: participation is only remote, and the meeting is deemed held at the head office.

In digital formats, the chair and secretary usually sign the minutes with a digital certificate, and the minutes record that the legal requirements were met. A remote voting ballot, where used, follows deadlines set in the DREI rules.

The dividend resolution and the 10% withholding

Law 15,270/2025 changed the tax consequences of the April minutes. Since 1 January 2026, profits and dividends paid, credited, delivered or used in favor of a partner resident abroad are subject to 10% withholding income tax, regardless of the amount. According to the Federal Revenue’s Q&A, the 10% rate applies even to residents of favored tax jurisdictions, and capitalizing profits into share capital also counts as a taxable use.

The transition rule depends on the date of the corporate decision:

The law also provides an optional credit for non-residents when the company’s effective corporate tax plus the 10% withholding exceeds benchmark rates of 34%, 40% or 45%, depending on the sector. Its mechanics depend on regulation, so check the current position with your tax advisers. Our guide to dividends to foreign shareholders covers treaties and alternatives.

What the dividend resolution should state

• the approved net profit and its allocation, including reserves required by law or the articles;
• the amount declared to each partner and, for grandfathered profits, a reference to the December 2025 approval being paid;
• the payment date or schedule, and whether payment is in reais to a Brazilian account or remitted abroad;
• authorization for the administrators to sign the foreign exchange contract and withhold and pay the tax.

Approved dividends become a liability in the accounts. Payments abroad are made through a foreign exchange contract, and the investee reports them to the Central Bank under the SCE-IED rules.

Calendar and filing

For a calendar-year Ltda, a workable timeline looks like this. The ranges reflect market practice, not legal deadlines, except where noted.

1. January to February: close the books

   The accountant closes the year and drafts the balance sheet and income statement; the group confirms the dividend policy.

2. Early March: plan signatures

   Decide between a written resolution and a meeting, and check that powers of attorney and digital certificates are valid.

3. By 31 March: circulate documents

   Send the statements to non-administrator partners at least 30 days before any meeting, with proof of receipt.

4. By 30 April: approve

   Hold the meeting or collect the signed written resolution, with the dividend resolution where applicable.

5. Within 20 days: file the minutes

   The Civil Code asks for a copy of the minutes to be filed with the Board of Trade within 20 days after the meeting.

6. Then: pay and report

   Pay dividends on the approved terms, withhold and pay the tax, close the foreign exchange contract and report to the Central Bank.

Two filings depend on the same numbers. Companies with foreign direct investment and total assets of R$ 100 million or more file an annual economic and financial declaration with the Central Bank by 31 March. The accounts approved in April should therefore be consistent with what was declared.

The cost of missing April

The Civil Code does not set an administrative fine for a Ltda that misses the April deadline. However, the consequences are real:

• No discharge: administrators, including expatriate country managers, are not discharged for the year until accounts are approved.
• Dividend risk: profits distributed without approved statements are harder to defend, and distributions that harm the capital can be reclaimed from partners.
• Banks and remittances: banks ask for approved statements and minutes for credit lines and dividend remittances.
• Tenders and contracts: public tenders and many private counterparties require the balance sheet of the last fiscal years.
• Due diligence: buyers and auditors flag missing approvals, and fixing several years at once delays a transaction.

If the deadline has passed, hold the approval late rather than not at all, and regularize prior years in sequence.

Common mistakes in the annual accounts approval

• Proxy without specific powers: a generic power of attorney that does not cover voting on accounts and dividends.
• Partner-administrator voting on its own accounts: a frequent issue in two-partner structures where the parent also appoints itself.
• Dividends declared without an approved balance sheet or above the profits available.
• Assuming 2025 profits are still exempt: without a distribution approved by 31 December 2025, they bear the 10% withholding.
• Minutes in English only: filings at the Board of Trade are in Portuguese; bilingual minutes in two columns work well.
• Unverifiable signatures: foreign electronic signatures the Board of Trade cannot validate, or missing authenticity declarations for copies.
• Forgetting the filing: minutes approved but never registered, which surfaces years later in due diligence.

Annual checklist

• Financial statements final and signed by the administrator and the accountant.
• Format chosen: written resolution, meeting, assembly or sole partner decision.
• Powers of attorney valid, specific, apostilled and translated where needed.
• Documents sent to non-administrator partners 30 days ahead, with proof.
• Dividend resolution reviewed for the 10% withholding and treaty position.
• Minutes signed, filed within 20 days and recorded in the books.
• Dividends paid, tax withheld, foreign exchange closed and Central Bank reporting done.

Questions investors ask