Fixed income ETFs grow with tax advantages, says CEO of Investo

The growth of fixed income ETFs in the Brazilian market has attracted the attention of investors. Interest is driven both by the country's tradition of conservative investments and by the tax benefits of this type of investment compared to other products in the segment. "When we talk about fixed income ETFs, there is a clear benefit: taxation. There is no IOF in fixed income ETFs, there are no quota fees and you pay a single rate, which does not depend on the application period, but on the ETF portfolio", said the CEO of Investo Cauê Mançanares, in an interview with Café com Investidor.

Tax benefits
In a scenario of high interest rates, with Treasury bonds and other fixed income options offering attractive returns, the model continues to occupy a relevant portion of Brazilian investors' portfolios. In this context, ETFs emerge as a more efficient alternative from a tax point of view.

One of the main advantages is the exemption from IOF (Financial Operations Tax). In traditional applications, such as CDBs, the tax is levied on income in the first 30 days and can consume practically all the gains in very short redemptions. In fixed income ETFs, this charge does not exist, allowing the investor to buy and sell shares without this tax being applied.

Another difference is the absence of the so-called come-quotas, a mechanism that anticipates the payment of Income Tax in traditional funds. In these products, every six months, part of the shares are automatically redeemed for tax collection. In fixed income ETFs, this anticipation does not occur.

Single rate regardless of term
Taxation is also simpler. In investments such as Tesouro Direto and CDBs, the Income Tax rate on the profit from securities decreases depending on the time of investment, varying from 22.5% for redemptions within six months to 15% for long-term investments.

On fixed income ETFs, the rate is 15% from the beginning, regardless of the term. Thus, the investor pays the same tax rate both on a sale made a few days after the purchase and on an investment held for several months.

Café com Investidor
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Source: CNN