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Brazil: STJ rules out social security contributions on stock option exercises
A binding precedent reaffirms the commercial nature of stock option plans and extends to social security contributions the reasoning established under Theme 1,226
Subjects
The First Panel of the Superior Court of Justice (STJ) ruled on October 14, 2026, regarding Repetitive Theme No. 1,379, bringing an important chapter in the dispute over share‑based incentive plans to a close.
Unanimously, the panel decided that neither employer social security contributions nor contributions owed to third parties are due when the beneficiary exercises the option to purchase shares under stock option plans. Reporting Justice Sérgio Kukina reaffirmed the understanding reached in Theme 1,226 – which analyzed the issue from the perspective of income tax – that such plans have a commercial nature and therefore fall outside the scope of social security contributions.
This decision unifies a landscape marked by legal uncertainty, including divergent positions held by both the Administrative Council of Tax Appeals (CARF) and the Judiciary.
Additionally, because the matter was decided under the special regime for repetitive appeals, the precedent must be followed by other courts. Proceedings on this subject, which had been stayed in second‑instance courts since the matter was selected in September 2025, are expected to resume. The binding precedent may also open the door to recovering amounts paid in the past.
The STJ established the following thesis: “Under the Stock Option Plan regime provided for in article 168, paragraph 3, of Law No. 6,404/76, employer social security contributions and contributions owed to third parties do not apply at the moment the option to purchase shares is exercised, because the plan constitutes a commercial transaction – as defined under Theme 1,226 of the STJ – and does not constitute remuneration for work.”
The court’s rulings have not yet been published.
For more information on this topic, please contact Mattos Filho’s Tax practice.
