Income Tax in Brazil for Foreigners

100 Brazil Reais

100 Brazil Reais

For Foreigners living in a new country, particularly Brazil, trying to decipher all of the ins and outs of income tax can be tricky. Thankfully, this guide will help you to understand all you need to know about the exact reasons for needing to file income tax, tax rates, and the specific deadlines for filing your income tax return.

There are a few ways that foreigners can be subject to paying income tax. If you qualify as any one of these resident taxpayers, then you will have to record your income tax.

  1. Naturalized Foreigners, which means those who have been granted full citizenship
  2. Foreigner that holds a Permanent Brazil Visa
  3. Foreigners that hold a Temporary Visa under an employee contract, but have arrived in Brazil after already living in Brazil for 183 days, which is counted within a 12-month period

If you fall under any one of these categories, you are going to need to pay income tax on your worldwide income on a monthly basis. These taxpayers are generally required to pay the Brazilian monthly income tax on the total sum of any offshore accounts, which covers everything from wages and compensation to rental income and capital gains. This needs to be filed along with your annual income tax return. Taxpayers also need to pay a monthly income tax based on all of the offshore payments from individuals other than yourself (Carnê-Leão program). These payments need to be filed by the final day of the next business month.

While all of the previous facts are important, the most essential of the tax process is that of the overall deadline for the submission of your income tax return, which happens to be the 30th of April. The rules surrounding this due date state that the taxpayer must file their income tax return by April 30, with the tax year encompassing that of the previous year. If you miss out on filing, you cannot ask for an extension. If you are late, you will be penalized and taxed on a monetary basis. If you feel the need, you can pay over a span of six monthly installments, which begin on the final filing date, that being the 30th of April.

Click here to go to the Receita Federal website, the tax authority in Brazil, akin to the Internal Revenue Service in the United States.

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About Addison Sears-Collins

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