The Definitive Exit Statement (DSD) is a special income tax statement, much like the annual adjustment statement (the “normal” statement). But there are some small differences between the two.
The DSD has one more form, called “Exit”, in which the data related to that exit are informed. In this form, the fields that the system asks to complete are:
- the appointment of an attorney, individual, to receive communications from the IRS such as letters and other notices about the situation of the person leaving. The appointment of the prosecutor is optional. In the form, the CPF, full name and address of the chosen attorney must be informed;
- date of the non-resident characterization: that is, the date of the tax exit;
- date of characterization of resident status in the country: field usually kept blank, applies to the situation of those who, in the same year, became tax residents in Brazil and then made the tax exit (for example, a foreigner with a visa) work that remained in Brazil for a few months project). This field fills in the date of the person’s tax entry in Brazil. When the tax entry occurred in a year prior to the tax exit, the fact is not reported in this form.
It should be noted that the indication of the attorney-in-fact and the date of the tax exit are the same information requested in the transmission of the Communication of Definitive Departure from the Country (CSDP). If it was transmitted, just repeat the same information.
The form of filling out the DSD’s assets and rights form is also different. If, for example, the person was a tax resident in Brazil at the beginning of the year and ceased to be a resident at any specific date before the end of the year, the assets and rights file will contain two fields: (i). the situation on December 31 of the previous year; and (ii) the situation at the date of characterization of the condition of non-resident, that is, the date of tax exit. The situation on December 31 of the calendar year does not matter, since the taxpayer was already in the condition of non-resident.
The assets and rights form is filled out according to the specific situation of the asset. Suppose that the declarant had a property, made the tax exit and after that, but still within the same year, completed the sale of that property to third parties. In this case, the property still belonged to the equity on the date of the tax exit, and therefore the cost of acquiring the asset must be maintained.
As with the assets and rights statement, the debt and collateral statement should also show the position of a debt on the date of the tax exit, and not on December 31 of the DSD calendar year. A debt settled after the tax exit should not be written off, as the settlement occurred after the non-resident condition started.
Therefore, what to keep in mind when filling out the DSD is the change in timing. The period starts on January 1 or on the tax entry date (whichever is later), and ends on the tax exit date. The declaration period will only end on December 31st if that is the date of the tax exit. The declarant should not be informed of what happens to the declarant’s assets or income before the tax entry (if it occurred after January 1) or after the tax exit.
There are also two differences from DSD in relation to the annual adjustment statement: (i). there is no option in the DSD for a simplified discount, only for legal deductions; and (ii). if DSD results in the collection of supplementary tax, it must be paid in a single installment, by the end of the delivery period. It is not possible to split the amount of the supplementary tax.
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