Do i need to pay TAX in Brazil ?

0POSTS

10 years ago

i am an Indian married to a Brazilian. , has permanent visa viper, RNE CPF etc.聽聽lived in Brazil for聽 1 year, now working as a salaried person in a TAX FREE country [ no income tax ] and each month i am sending money to my wife account as family support [around 8k reais] .other thing is, in India i do not need to pay tax as well [ Non resident Indians are exempted from paying tax on their income from abroad ]

so i am sure sooner or later Brazilian tax regime gonna ask questions about the money coming from abroad to my wives account.聽 so what should i do? do i need to pay tax in Brazil? or any exemption are there for foreign income?

please note that Brazil has double taxation treaty with INDIA聽

So suggestions and guidelines please guys. any expert advice?聽 thanks

See also

James ViP

11272POSTS

10 years ago

Hello ra83sh,

You most certainly will need to file an annual DIRPF - Declara莽茫o de Impostos de Renda, Pessoa F铆sica with the Receita Federal. On your delclaration you are REQUIRED to report your foreign income. It will depend completely on the Treaty that exists between Brazil and India, if you will pay taxes here on that income or not, and how much you will be required to pay here.

You will need to consult an international tax specialist to prepare your annual declaration because international taxes are simply too complicated for one to do themselves here in Brazil.

Since you are not paying income tax in the country where the income is being earned, my guess it that you will almost certainly be taxed on it here in Brazil, especially since you are sending around 8k Reais each month back to Brazil. This amount alone is well above the annual exempt limit on earnings. I don't think the question is IF you will be taxed here, but rather HOW MUCH of your foreign income will be subject to income taxes here in Brazil. I think that at the very minimum you're going to get taxed on everything you've sent back here. At worst you may be taxed on your entire foreign income, less the exempt amount here which is around 25K Reais.

Only an international tax specialist is going to be able to give you a definitive answer on this.

Cheers,
James聽聽聽Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

thanks james.聽

so my guess聽 and worries was real.聽 i have no idea where i can find an international tax practitioner. i heard like the tax will be 27 %聽 . so聽 almost half what i am sending now to brasil will go to Brazilian tax regime ?聽聽

James ViP

11272POSTS

10 years ago

What city does your wife live in? Perhaps I can find somebody to help with your taxes. If I do I'll post the contact information or a link to their website here.

Cheers,
James

atdoe Guest

0POSTS

10 years ago

thanks james. the city name is cuiaba.

James ViP

11272POSTS

10 years ago

Your wife may want to contact this accounting firm in Cuiab谩.

I don't know them personally so can't make any recommendations, but it was about all I could find doing an online search.

Good luck!

Cheers,
James聽 Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

thanks james.

stevefunk Serial expat

671POSTS

10 years ago

Don't put the cash into a "Brazilian" account

James ViP

11272POSTS

10 years ago

stevefunk wrote:
Don't put the cash into a "Brazilian" account

Steve, I hate to be the one to burst your bubble, but it doesn't matter one little bit WHERE you put the money, or even where you EARN it. The law requires permanent residents (i.e. anyone residing in Brazil for more than 180 days) to file an annual DIRPF (Declara莽茫o de Imposto de Renda - Pessoa F铆sica). Regardless of where you earn your income, you are required to report any foreign income to the Receita Federal as "World Income" on your DIRPF. Whether or not you get taxed on that income here in Brazil depends completely on wheter or not a Tax Treaty exists between your country and Brazil. If there is no such Treaty then you have no protection whatsoever against double taxation, other than any possible deductions your country may allow for taxes paid to a foreign tax authority.

Cheers,
James聽聽聽 Expat-blog Experts Team

stevefunk Serial expat

671POSTS

10 years ago

#10

Sure , but he's specifically worried about the money going into his wife's account in Brazil

James ViP

11272POSTS

10 years ago

#11

His wife is a Brazillian, where else is she going to have an account?

Even if he were to deposit to an account in her name in some other country, that just passes off the tax burden to her then, as she would have to declare it on her DIRPF.

Cheers,
James聽聽 Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

#12

I got some info from my " research "聽

聽 here it is

i have to submit Comunica莽茫o Definitiva de Sa铆da do Pa铆s" (CSDP)聽 after exiting brazil聽 then聽 this declaration also o:- "Declara莽茫o de Sa铆da Definitiva do Pa铆s (DSDP), refers to the last statement of Personal Income Tax that the Brazilian citizen should do when you decide to live abroad聽 (temporary or permanent ).

( this all come into effect only聽 if a tax resident is away from brazil more than 12 consecutive months.)

after submitting Comunica莽茫o Definitiva de Sa铆da do Pa铆s (CSDP) i am becoming a non-tax resident for a temporary basis. in that period i do not need to pay tax for the income that i earned abroad.

A Comunica莽茫o Definitiva de Sa铆da do Pa铆s (CSDP) is the document that the Brazilian citizen ( i read this as tax resident) must submit to the Internal Revenue Service of Brazil communicating their exit from the country (聽 temporary or permanent). In other words, this document is to inform the tax authorities that, from a given date, citizens effectively ceased to be resident in the country. so after submitting this to RFB the tax resident is actually exempt from Tax in brasil. if he do not have any income from brasil in this period.

but still i haven't got any clue about my remittance to wife RFB gonna tax it or not.

this is what i understood any more info about this JAmes ?

James ViP

11272POSTS

10 years ago

#13

Hello ra83sh,

Before you do anything else you should check with an immigration lawyer. I'm pretty sure that by filing a CSDP, as an expat this also means giving up your permanent resident status. If it is NOT your intention to ever return to Brazil then that won't be a big deal. If on the other hand you're only planning a temporary absence for work purposes, then you would have to go through the whole headache of re-establishing your RNE/CIE upon returning. When a citizens files a CSDP that absolves them of the tax obligation, but has absolutely no effect on their citizenship. It is not necessarily that way for a non-citizen expat who is registered as permanent. Just remember here in Brazil permanent is not PERMANENT. You will even lose it by being out of Brazil for more than 2 years.

Regardless of where it comes from, the money passed to your wife's account, plus the interest that it generates is going to be taxed. She will have to declare all of it as income because the bank is also required to report all such transactions to the RF as they take place. If she fails to claim these amounts on her DIRPF she can end up in serious problems.

Cheers,
James聽聽聽Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

#14

hi james

so now i am preparing myself for the tax reality. [ i am doing this for the first time in my entire life]

example.聽 her salary is just 12000 reais聽 yearly

and her income from abroad as remittance is 50000 reais

so how much will be the tax ?聽 an approximate amount?聽

do they calculate a flat 27.5 % of 62000 [ total聽 income] ? or need to聽 deduct 27000[ Exempt from聽
Income Tax]聽 from this 62000聽 then for the rest of the amount聽 35000 @27.5 % tax?聽 or they calculate 35000@ 22.5 % i am sorry i am just confused can you help me out ?

James wrote:
Hello ra83sh,

Before you do anything else you should check with an immigration lawyer. I'm pretty sure that by filing a CSDP, as an expat this also means giving up your permanent resident status. If it is NOT your intention to ever return to Brazil then that won't be a big deal. If on the other hand you're only planning a temporary absence for work purposes, then you would have to go through the whole headache of re-establishing your RNE/CIE upon returning. When a citizens files a CSDP that absolves them of the tax obligation, but has absolutely no effect on their citizenship. It is not necessarily that way for a non-citizen expat who is registered as permanent. Just remember here in Brazil permanent is not PERMANENT. You will even lose it by being out of Brazil for more than 2 years.

Regardless of where it comes from, the money passed to your wife's account, plus the interest that it generates is going to be taxed. She will have to declare all of it as income because the bank is also required to report all such transactions to the RF as they take place. If she fails to claim these amounts on her DIRPF she can end up in serious problems.

Cheers,
James聽聽聽Expat-blog Experts Team

James ViP

11272POSTS

10 years ago

#15

No, it is not a flat tax. The tax owing is based on incriments of income earned.聽 See the link below and look at the THIRD box. It is the tax rates for ANNUAL INCOME.

Cheers,
James聽聽 Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

#16

hi james

This i copied following guidlines from聽 here聽

Caracteriza莽茫o da Condi莽茫o de Residente no Brasil

Considera-se residente no Brasil, a pessoa f铆sica:

1 - que resida no Brasil em car谩ter permanente;
2 - que se ausente para prestar servi莽os como assalariada a autarquias ou reparti莽玫es do Governo brasileiro situadas no exterior;
3 - que ingresse no Brasil:
a) com visto permanente, na data da chegada;
b) com visto tempor谩rio:
聽聽 b.1. para trabalhar com v铆nculo empregat铆cio ou atuar como m茅dico bolsista no 芒mbito do Programa Mais M茅dicos de que trata a Lei n潞 12.871, de 22 de outubro de 2013, na data da chegada;
聽聽 b.2. na data em que complete 184 dias, consecutivos ou n茫o, de perman锚ncia no Brasil, dentro de um per铆odo de at茅 doze meses. (Caso, dentro de um per铆odo de doze meses, a pessoa f铆sica n茫o complete 184 dias, consecutivos ou n茫o, de perman锚ncia no Brasil, novo per铆odo de at茅 doze meses ser谩 contado da data do ingresso seguinte 脿quele em que se iniciou a contagem anterior);
聽聽 b.3. na data da obten莽茫o de visto permanente ou de v铆nculo empregat铆cio, se ocorrida antes de completar 184 dias, consecutivos ou n茫o, de perman锚ncia no Brasil, dentro de um per铆odo de at茅 doze meses;

4 - brasileira que adquiriu a condi莽茫o de n茫o residente no Brasil e retorne ao Pa铆s com 芒nimo definitivo, na data da chegada;

5 - que se ausente do Brasil em car谩ter tempor谩rio ou se retire em car谩ter permanente do territ贸rio nacional sem apresentar a Comunica莽茫o de Sa铆da Definitiva do Pa铆s durante os primeiros 12 (doze) meses consecutivos de aus锚ncia.

Caracteriza莽茫o da Condi莽茫o de N茫o Residente no Brasil

颁补谤补肠迟别谤铆蝉迟颈肠补

颁辞苍诲颈莽玫别蝉

n茫o residente no Brasil

1 - que n茫o resida no Brasil em car谩ter permanente e n茫o se enquadre nas hip贸teses do item Conceito de residente no Brasil;

2 - que se retire em car谩ter permanente do territ贸rio nacional, na data da sa铆da, com a apresenta莽茫o da Comunica莽茫o de Sa铆da Definitiva do Pa铆s;

3 - que, na condi莽茫o de n茫o residente, ingresse no Brasil para prestar servi莽os como funcion谩ria de 贸rg茫o de governo estrangeiro situado no Pa铆s, ressalvado o disposto no item 4 de Conceito de residente no Brasil;

4 - que ingresse no Brasil com visto tempor谩rio:

a) e permane莽a at茅 183 dias, consecutivos ou n茫o, em um per铆odo de at茅 doze meses;

b) at茅 o dia anterior ao da obten莽茫o de visto permanente ou de v铆nculo empregat铆cio, se ocorrida antes de completar 184 dias, consecutivos ou n茫o, de perman锚ncia no Brasil, dentro de um per铆odo de at茅 doze meses;

5 - que se ausente do Brasil em car谩ter tempor谩rio, a partir do dia seguinte 脿quele em que complete doze meses consecutivos de aus锚ncia.

please check , i google聽 translated聽 and read so may be my mistake聽 but聽 i think聽 they mentioned who came to brasil with a permanent visa also need to do this CSDP聽 . but i don't know its gonna affect the RNE or "Permanent visa Status".聽 any idea ?

James ViP

11272POSTS

10 years ago

#17

The guidelines you've read are ONLY to determine who is or is not considered a resident for tax purposes. They have nothing to do with the permanency process itself.

Basically, anyone who is in Brazil for more than 180 days (legal annual limit for a tourist) is considered a resident for tax purposes, and must file a DIRPF.. Those individuals must continue to file annual returns (if over the exempt salary) until such time as they leave the country and file a CSDP.

When one obtains a VIPER Permanent Visa from a Consulado outside of Brazil, they are considered a resident for tax purposes from the moment they arrive in Brazil. Again this is ONLY for tax purposes and has nothing to do with the permanency process itself.

That said, filing a CSDP may have the effect of cancelling one's permanency application if they file one during the processing of their permanency application. This is something that one must check with the Federal Police, since one may only absent themselves from Brazil for 90 days at a time during processing.

Cheers,
James聽聽聽聽Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

#18

so you are basically saying like, csdp and dsdp has nothing to do with RNE status or permanent visa status ?聽 if i do CSDP my Permanent visa or RNE gonna affect adversely聽 ? i got my permanent visa before entering brazil (its not under process . i already have聽 RNE and Viper visa) .聽 i am asking this because in an earlier reply you suggested me聽 to get more info聽 before doing CSDP because it may revoke my RNE or VIPER VISA.

thanks james

James ViP

11272POSTS

10 years ago

#19

For TAX PURPOSES you're a resident from the moment you arrive in Brazil since you already have a VIPER.

What I'm saying is that filing the CSDP to avoid tax liability on leaving Brazil, permanently or temporarily, could very well have the effect of renouncing your permanency. You need to check with the Federal Police and the Receita Federal before you do anything of that kind.

In Brazil permanency is NEVER permanent, it can be cancelled for several reasons. One of those reasons is being outside of Brazil for more than 2 years. You don't want to find out the hard way afterwards that filing a CSDP could possibly be another one of those reasons. While the CSDP is a tax document, it MAY HAVE SERIOUS IMPLICATIONS regarding your permanent visa status, you need to make certain.

Now do you understand?

Cheers,
James聽 Expat-blog Experts Team

atdoe Guest

0POSTS

10 years ago

#20

yup crystal clear.

AfroPrince Active member

52POSTS

10 years ago

#21

What about if you are resident with VIPER, but you only spend a couple of weeks in any 6 month period i.e. less than 180 days per year.聽 Is tax still due? Does the 180 have to be continuous?

James ViP

11272POSTS

10 years ago

#22

If you're a permanent resident you have to pay taxes PERIOD.聽 The 180 day rule is for anyone here whether or not they have documentation, they're considered a "resident for tax purposes", that is quite different from "having permanent resident status" which automatically carries a tax obligation.

You will need not only to report your Brazilian income, but also your worldwide income (so everything you earn in your homeland) and if there is no bilateral Tax Treaty between the two nations, you will likely be taxed on that income here in Brazil too.

Cheers,
James聽聽 Expat-blog Experts Team

AfroPrince Active member

52POSTS

10 years ago

#23

Very clear answer James, really appreciate your input on this - I'll try an look for a post that hopefully explains what I will need to do in this regard as I expect it will be another difficult time ahead trying to navigate this :-/

Thanks!

stevefunk Serial expat

671POSTS

10 years ago

#24

How does Brazil keep tabs on "Worldwide income"聽 ?
Do you have to submit any supporting documents ...

James ViP

11272POSTS

10 years ago

#25

While I don't have any personal knowledge about that, I would presume that you do need to produce supporting documents. Also once you claim such income, most countries do have reciprocal agreements that permit verification.

Cheers,
James聽聽聽 Expat-blog Experts Team

AfroPrince Active member

52POSTS

10 years ago

#26

By any chance, are there any links or contacts I could follow up on for research?聽 Haven't managed to find or understand what I've found so far..聽 Interested to see what could be done to minimise exposure to double taxation if at all possible.. also do I need to mention my situation to anyone when I arrive in BR with VIPER status?

James ViP

11272POSTS

10 years ago

#27

If you've applied for a VIPER Permanent Visa, outside of Brazil then it is going to be attached to the inside of your passport. The Federal Police Agent who checks you in through Customs & Immigrations is going to see it.

If you're arriving in Brazil on a VITUR Tourist Visa or Visa Waiver Program (VWP) entry and intend to apply for permanency afterwards, then no you don't have to tell them anything.

Cheers,
James聽聽 Expat-blog Experts Team

AfroPrince Active member

52POSTS

10 years ago

#28

Thank you James, So just to check my understanding, on arrival with VIPER in passport, will they ask me any questions regarding taxation? I'm just trying to forward plan for anything that I need to do regarding this once I set foot on BR soil

All your help and advice very much appreciated James

James ViP

11272POSTS

10 years ago

#29

No the Federal Police won't ask you questions about taxes on arrival. However your are considered taxable from the moment you arrive in Brazil because you're a permanent resident. Since everything you will ever do in this country will involve your CPF number (individual tax number) the Receita Federal will know everything about you.

Cheers,
James聽聽 Expat-blog Experts Team

AfroPrince Active member

52POSTS

10 years ago

#30

Thank you James

ChrisH79 Member

2POSTS

9 years ago

#31

Hi James

I lived in Brazil for some years, married a Brazilian, but am now returned to London I still have an RNE and all that goes with it.

Seeing I've been back here now for a while I am keen to make sure everything is up to date and have been looking at the Saida Definitiva as an option to simplify life.

Can you recommend any tax/legal expert I could get in touch with in Brazil or even London to talk through the intricacies of this and, eventually, guide me through the procedure?

Thank you

Chris

stanza51 VIP Member

283POSTS

9 years ago

#32

Hi Chris

Please note that you can contact any Contabilidade "accountant" to check on your taxes.

As far as Sa铆da definitiva is concerned, are you planning on cancelling your RNE?

If so I believe you don't require any lawyer to guide you through the process as you can easily contact the Brazilian Embassy and they can explain the procedure to you.

Good luck and please do update us on your adventures

ChrisH79 Member

2POSTS

9 years ago

#33

Hi Stanza, thanks for the reply

This is kind of why I want to speak to an expert in the field.

I want to know whether the RNE is cancelled as a result of the Saida process (information online is, as ever, contradictory).

I also want to know what the process would do to the property I own in Brasil, and the income from it. Also my bank account and investments in country.

Further, I can't find a simple explanation of the process itself online, so I wanted someone to walk me through it.

Given the above, I don't think your average empresa de contabilidade is going to be able to help me, hence my request for a specialist in the field.

If you do happen to know anyone, I am happy to pay. I even got in touch with Deloitte and PWC in Rio who didn't seem to want my business. I love Brasil!

Abracos

ndfansince53 Active member

70POSTS

9 years ago

#34

Try EUROPARTNER Ltda. They have offices in Rio de Janeiro, Fortaleza and Sao Paolo.

They are an accounting and consulting firm.

颁补产别莽补叠谤补苍肠补 New member

9POSTS

8 years ago

#35

James wrote:
No the Federal Police won't ask you questions about taxes on arrival. However your are considered taxable from the moment you arrive in Brazil because you're a permanent resident. Since everything you will ever do in this country will involve your CPF number (individual tax number) the Receita Federal will know everything about you.

Cheers,
James聽聽 Expat-blog Experts Team

James / any other guru

How does the Brasilian tax regime treat a retired Brit in Brasil, paying full UK tax on pension in the UK ?

atb

Paul

stevefunk Serial expat

671POSTS

8 years ago

#36

oh my, you're going to pay full double taxes in both countries!

颁补产别莽补叠谤补苍肠补 New member

9POSTS

8 years ago

#37

stevefunk wrote:
oh my, you're going to pay full double taxes in both countries!

Me ???

How would that be collected at this end ?

jland912 Serial expat

884POSTS

8 years ago

#38

Your taxable income in Brazil will not be taxed double. There is an exemption based on your foreign income. It's best to consult a tax attorney.

Jim

Marcos999 Active member

46POSTS

8 years ago

#39

No double taxation.聽聽

Despite the fact that there is no treaty with the UK.聽聽

I am no tax guru, and don't take my word for it.聽 Just run a search on "reciprocal tax treatment."聽 You'll find that the UK is one of three non-treaty countries for which you can receive a foreign tax credit locally.

Globally, you'll end up paying the higher tax rate of the two.聽 But not the two combined.聽

Locally, if your UK tax rate is higher, you won't owe a cent in Brazil tax on that income.

颁补产别莽补叠谤补苍肠补 New member

9POSTS

8 years ago

#40

Thanks guys, I have no problem with paying tax (said through clenched teeth) on the basis of the two things in life that cannot be avoided "death and taxes" however losing in excess of 50% of a pension would be a tough one.聽 Tax lawyer coming up ....