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Hello, João!
Thank you for your interest. Your question is very good. The Internal Revenue Service's position has been that all types of non-resident income that are neither exempt nor exempt are taxed at 15%. This understanding has been applied to amounts received in the form of donations and inheritances (which I don't agree with), and also to VGBLs, on the grounds that they are a type of life insurance, not a pension plan (which I do agree with). So the safe answer is to say that it is 15%. To argue that it would not be taxable, you would have to argue that it is not income, but a type of indemnity for loss, which is a little more difficult to do.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Ruth!
Thank you for your interest in our content. Normally, income from abroad is reported on the "carnê leão" form, taxed at up to 27.5%. There is a specific rule on how to convert the amounts in euros to reais, including to convert the tax paid abroad and allow it to be offset in Brazil. On how to make this conversion, I deal with the subject in this text.
There are specific situations in which I argue that the agreement between Brazil and Portugal to avoid double taxation rules out Brazilian taxation in specific situations of double tax residence. This is a much more complex issue, and it would be more appropriate to deal with it in a consultation, to find out whether or not it will become applicable to you.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Nigri!
Thank you for your interest in our content. Both ways are possible, but certainly, if you receive a property as a gift in anticipation of an inheritance and then sell it, you will realize capital gains in both countries. Brazilian law allows the transfer to you to be made at market value, so that your parents can pay income tax on the capital gain in Brazil in advance. For real estate, this can be interesting tax planning, especially if the Australian side treats this situation in the same way.
It would really only be possible to give a recommendation in a consultation, or with an analysis of the documents. But I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Felipe!
Thank you for your interest. If the sale of the property took place after the tax exit, then it was already done as a non-resident, and would not need to be declared in the DSD. The IRS, as far as I know, has not said that it is obligatory to attach this information to the tax return, only to pay the tax correctly.
The mechanics of the program mean that you can fill in the GCAP program with the information about the sale, but you will need to enter the country in which you are a tax resident in the GCAP program and the period (from 08/2021 to 31.12.2021). You can then import the data into your outgoing declaration. It's different from normal, but it can be done.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Felipe,
With regard to bank accounts, we didn't find any provisions from the Receita Federal, only from the Central Bank. And for the Central Bank, the focus of the legislation is on the financial institution, rather than the customer. You don't lose the account automatically, but under the current rule, the bank is obliged to close the account when it becomes aware that you are no longer a tax resident in Brazil.
The Central Bank is expected to release for public consultation the regulations for the New Foreign Exchange Law, which will come into force in 2023. Positive changes are expected, which will allow the account to be maintained normally. But it's too early to be sure. You'll have to be patient.
Cheers!
Hello, Gisela!
Thank you for your interest in our content. If you have stopped living in Brazil in the last five years and have not filed any further tax returns, you can regularize your late departure by filing a tax return for 2018. In this case, only your rental income (the 15% of net rent) and financial income from your bank account earned after your departure would be taxable in Brazil.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, José Henrique!
Thank you for the compliment and for your interest in our content. I agree that the procedure you suggest is quite conservative, and it would be difficult for the tax authorities to question it. In practical terms, the legislation is not unfavorable on this point. I think the bigger point is that it becomes so laborious to make this distinction that even the tax authorities would have problems assessing the taxpayer. I have already researched Carf case law, and the only decision I found dealt only with the burden of proof: if the taxpayer says that the source of the income is one, the burden is on the tax authorities to say otherwise. But how can it say otherwise?
Thank you once again. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Rosita!
Thank you for your interest. I have argued that the criterion used by Brazil, "definite intent", is subjective and allows a person's situation to be interpreted in different ways. In this case, it is possible to argue, for example, that due to the employment relationship with Brazil, it would not be the case to present the declaration of definitive departure. It's worth saying that this conclusion could lead to double tax residency (continuing to be a tax resident in Brazil and becoming a tax resident abroad, paying income tax on salary in both countries).
It is also possible to argue the opposite, so that the permanent withdrawal is made. In this case, the public service needs to be notified of the tax withdrawal in order to withhold 25% of IRRF on the amount of remuneration received.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Elena!
Thank you for your interest in our content. It's very difficult for me to give you a recommendation for a blog post; the best thing to do is to consult us. In general, I think you're right when you say that there are two possible tax exit dates under the legislation. To take 24.10.2020 into account, you will need to rectify the DAA 2021/2020 to replace it with a DSDP with that tax exit date. In this case, the program will calculate your tax proportional to 10 months (January to October), and subsequent income will not need to be declared. In this case, too, there would be no declaration to submit in 2022.
In the event of a tax exit under the temporary exit rule, you are obliged to report your French income until Oct. 2021, and you can take advantage of the benefits of the Brazil-France agreement to avoid double taxation.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Edivaldo!
Thank you for your interest. The Central Bank makes it compulsory to maintain any bank account, whether it has financial investments or not. In any case, when the intention is to liquidate all the investments by closing the account, there is only the closing of the account and liquidation of the amounts, without opening a CDE.
Changes to the CDE rules are expected soon, in view of the New Foreign Exchange Law, which comes into force in 2023. I recommend waiting a while to find out what the Central Bank is going to propose.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Edivaldo!
Thank you for your interest. The Central Bank makes it compulsory to maintain any bank account, whether it has financial investments or not. In any case, when the intention is to liquidate all the investments by closing the account, there is only the closing of the account and liquidation of the amounts, without opening a CDE.
Changes to the CDE rules are expected soon, in view of the New Foreign Exchange Law, which comes into force in 2023. I recommend waiting a while to find out what the Central Bank is going to propose.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Sakine!
Thank you for your interest in our content. Generally speaking, you can do the procedure in two ways: (i). make a foreign exchange contract sending the funds directly from your account abroad to the account of the seller of the property in Brazil, or (ii). remit your money from your account abroad to a bank account of yours in Brazil, and from there make the payment to the seller of the property. The first option depends on you providing the institution carrying out the exchange with information on both parties and documents on the nature of the transaction. The second option involves you proving the origin of the funds you are sending abroad.
Both alternatives have their pros and cons. My suggestion is that you contact the exchange desk of the institution you prefer and ask what documents they will require to make the exchange (either option (i) or (ii) above).
It's not clear from your question what your real situation is in Brazil (whether you left the country without submitting declarations or whether you've been submitting them every year, only reporting the Brazilian part). In any case, the situation will need to be regularized to allow the funds to be transferred.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Giovanna!
Thank you for your interest. I believe you said that you missed the deadline for submitting the definitive exit notice (CSD) and want to submit the definitive exit declaration (DSDP).
I have argued that missing the deadline for submitting the Notice of Final Exit cannot have the effect of making someone a tax resident in Brazil for another 12 months in a row, if you have already left Brazil with the intention of losing the "definitive spirit". I talk about this in this other text. I understand that you can take advantage of the deadline for submitting the Declaration of Final Departure from the Country (May 31st) to get your situation in order.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Rosi!
Thank you for your interest. This will depend on the nature of the help you receive. If it can be understood that it is a donation, then there would be no income tax, but state inheritance and gift tax (the rate varies from state to state, but is always a maximum of 8%). In this case, this state tax would be collected according to the rules of the state in which you live. It's worth mentioning that the STF has ruled that it is unconstitutional to levy this tax when the donor is resident or domiciled abroad, as long as there is no complementary law regulating the levy.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Roberta!
Thank you for your interest. If you've returned to Brazil, you'll have to file a "normal" income tax return the following year, stating your assets as of your return and reporting your assets and income in Brazil and abroad from then on. There are some peculiarities about how to fill in the DIRPF in this case.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Nicole!
Thank you for your interest. If you are to remain dependent on your mother (and therefore a tax resident in Brazil), then the income from abroad must be reported on your mother's tax return (if any). The way to declare it depends on the type of income, which is what we're talking about here in this text.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Carla!
Thank you for your interest. It's very difficult to answer your question without knowing the facts and documents. Generally speaking, the information may have been omitted from the tax return only by mistake (fault) or with the intention of omitting information (willful misconduct). If there is willful misconduct, the IRS can not only charge the tax but also impose a 150% fine on the amount of tax due. If there is only guilt, the fine is 75%. If the tax returns are corrected and any tax due is paid before the tax authorities take any action, it is possible to pay only the late payment fine (20%) and, in special situations, to make a spontaneous report, in which the fine is zeroed out and only interest is paid.
But these are not the only variables. You also need to know the amount of tax paid abroad (to deduct from the tax due in Brazil), whether it is possible to apply any benefits provided for in an international agreement and also whether there are any other declarations to submit, such as to the Central Bank.
I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Jaqueline!
Thank you for your interest. Without understanding the details of your situation, just what you have reported, it seems that the simplest and most effective thing would be for you to submit the final exit declaration for Feb/2019, even if you pay a fine for late submission (approx. R$ 170). In this case, the salary received in Jan/2019 would be reported. This is just an opinion, not a recommendation, as I haven't had the opportunity to analyze the case.
But I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
Hello, Rodrigo!
Thank you for your interest. It's very difficult to give a recommendation without knowing the case, Rodrigo. Our experience with non-resident accounts has been that the recipient of the Central Bank's rules is the bank, not the client, and that it would therefore be possible to keep the account without penalties, pending certainty about what the new exchange rules will be (everything indicates that they will be made public at the beginning of May). At the same time, there are now banks that offer CDE at slightly more reasonable rates (such as Santander and Banco Rendimento). This decision needs to be made by you given the context.
I can't give you a firm opinion, but I hope I've helped. If you need our support, just contact us at WhatsApp or by e-mail contato@tersi.adv.br!
