Tax income declaration for individuals: Brazilian & Expatriates

published on 8 March 2021 | reading time approx. 2 minutes

At 1 March 2021, the period for filing the Brazilian Personal Income Tax Declaration (Fiscal Year 2020) began. The delivery of the obligation is due by 30 April and is required for who:

Received taxable income above BRL 28,559.70 in 2020. The amount is the same as last year's income tax return (2019).
Got, in any month of 2020, capital gain on the sale of assets or rights, or carried out operations in the stock, commodities, futures and similar markets.
Those who became resident in Brazil in any month and were in that condition until 31 December 2020.

In addition to the situations described above, there are other conditions that oblige the taxpayer to declare income tax in Brazil.

IMPACTS TO EXPATRIATES RESIDING IN BRAZIL

For expatriates residing in the Country, it is necessary to assess whether the tax residency was characterized by checking information such as date of entry, period of stay, type of visa used to stay in Brazil and other relevant information.

If the Brazilian tax residency is characterized, the taxpayer must pay income tax over the total remuneration earned worldwide (global income principle), irrespective of their location or remittance of income to Brazil, through spontaneous monthly payments (i.e. carnê-leão). Therefore, in these cases, the expatriate must also deliver and calculate the income tax in Brazil.

As mentioned, taxpayers have to send all related information to the Brazilian tax authorities by 30 April 2021.

Those who are obliged to declare and do not do so, or send the declaration late, will have to pay a fine of at least BRL 165.74, and a maximum of 20 per cent the tax due. In addition to this financial penalty, expatriates who have pending issues with the Brazilian tax authority (“Receita Federal do Brasil”) may have complications to issue documents in the country and even have a restriction on the “CPF” (i.e. taxpayer number).