Regarding Double Taxation

It depends where you earn.. means if you ean in Brazil you will be taxed at Brazil and if you earn any profit in India through any means you need to pay tax in india too

Generally speaking if you have Brazil sourced income you will be taxed on that income in Brazil if you reside in this country. If you also have income sourced in India you will be taxed on that income in India. You are also required to report that foreign income on your Brazilian Declaração do Imposto de Renda Pessoa Fisica (DIRPF) as part of your world income. You'll likely have to declare Brazilian income on your India Income Tax return too. That's not to say that you'll be taxed on foreign income in either country, just that they want to know about it.

For more information about the Brazil - India Tax Treaty see the following link:

http://dbinbrazil.com/international-tax … l-x-india/

Cheers,
William James Woodward, Expat-blog Experts Team

Thanks Wood,

Do we need to pay the tax for accommodation provided by company?

I would think that it would be a taxable benefit so yes, you probably would have to pay tax on the accommodations.

William, once again looking to your expert advice.

Expat from the US, living in Brazil permanently.  I believe US and Brazil do not have a tax treaty to avoid taxation.  I have an apartment in the US which I rent out.

2 questions:
1) I understand the income from this apartment is considered taxable in Brazil.  What expenses can I apply to reduce the income.  Condominium fees, utilities, Insurance, Real Estate Taxes, Interest on my Mortgage, travel expenses to my apartment, etc?  My understanding is that most are deductable, however the Mortgage interest may not be.

2) (This may be out of your realm of expertise)  As I am taxed in Brazil, I can deduct the taxes paid on my US taxes.  Quesion is if you know what I deduct, the taxes actually paid in 2013, or also include the taxes that I have to pay now for tax year 2013?

I understand the correct response is to speak with a tax specialist on this, but your thoughts are very welcome on this.

Looking forward to your thoughts as usualy.

Steve

Cholows wrote:

William, once again looking to your expert advice.

Expat from the US, living in Brazil permanently.  I believe US and Brazil do not have a tax treaty to avoid taxation.  I have an apartment in the US which I rent out.

2 questions:
1) I understand the income from this apartment is considered taxable in Brazil.  What expenses can I apply to reduce the income.  Condominium fees, utilities, Insurance, Real Estate Taxes, Interest on my Mortgage, travel expenses to my apartment, etc?  My understanding is that most are deductable, however the Mortgage interest may not be.

2) (This may be out of your realm of expertise)  As I am taxed in Brazil, I can deduct the taxes paid on my US taxes.  Quesion is if you know what I deduct, the taxes actually paid in 2013, or also include the taxes that I have to pay now for tax year 2013?

I understand the correct response is to speak with a tax specialist on this, but your thoughts are very welcome on this.

Looking forward to your thoughts as usualy.

Steve

I have a basic understanding of these taxes. If possible you should do your Brazilian taxes first as they are just for Brazilian income. I do not believe that you need to report to Brazil any income from any property located in the United States and kept in the United States, and the IRS isn't going to share that information with Brazil. Keep your money in the US and use a no-fee international credit card for small expenses in Brazil.

The United States taxes you on all worldwide income. This also means that you can deduct all your taxes in Brazil up to a certain amount. I believe since you pay higher taxes in Brazil than in the US you will not be double taxed on Brazilian income in most cases. You will be taxed on anything extra that you earn in the United States above a certain minimum amount. You will most likely be paying taxes on your property in the US.

You may end up a year behind on deducting your Brazilian taxes, 2013 Brazil taxes deducted on 2014 US tax. You could submit taxes faster and deduct in the same year though, but good luck to that. Also, deductions in the US are usual under the 80 to 90 thousand dollar mark, and you should expect to pay significant taxes when you go above that.

Also, as you already pointed out, you are going to need to hire a tax consultant for the correct answers.
If the rental property is your only source of income, and maybe you're an "independent contractor" in Brazil then you could get by with just the help that the IRS offers for free. This is where I have gotten my information.

First of all your Brazilian income dictates whether or not you file a DIRPF or not. If you earn over the exempt amount (somewhere around R$24,500 / year) then you must file. Under the exempt income you don't need to. There used to be a requirement to file annually a "Declaração de Isento", but that was done away with several years ago.

You are required to file if you buy or sell a house in Brazil, this is essentially to document what you paid for it so they can nick you later when you sell it for the capital gain.

As far as I'm aware you are under no obligation to declare any assets that you already have in the USA, and I would not do so unless somebody here specifically points out a law that requires it. Tiger is correct, it is highly unlikely that Uncle Sam is going to share any such information with the Receita Federal.

There is no Tax Treaty between the USA and Brazil. Since you are taxed based on citizenship in the USA you are still legally required to file a 1040 every year and pay taxes on your US sourced income. You are also required to report all foreign income to the IRS as well. That is not to say that you're necessarily going to be taxed on foreign income, just that Uncle Sam wants to know about it. It is my understanding that now you will also have to report all foreign bank accounts under the new FACTA laws, which I really know very little about.

Hope this is of some assistance to you.

Cheers,
William James Woodward, EB Experts Team

As a brazilian tax resident, i am told i need to report all foreign assets and foreign income.  As the company i work for has hired tax people to prepare both my Brazil and US taxes they know of all of the income, and since today is the deadlune for filing Brazil income taxes, i do not have much flexibility.

I will ask them if I really need to declare my apartment income in Brazil, as it really causes an impact on the amount I owe!

Thanks for the responses!

Sounds like you have professional tax guidance. If they answer "should" report and not "must" report, then you do not have to report. You don't have to worry about the IRS communicating with Brazil if it comes down to that. Good luck with your taxes!

Thank you for the inputs.  I have learned to question the expert professional advice as often is not correct.  Thank you!

You wouldn't have to report any US assets that were acquired before Jan. 1, 2013 at any rate ever if you are legally required by law to report them. You are required to report your US income just as you're required to report your Brazilian income as "world income" to the IRS. If you purchased a home in 2013 in Brazil you certainly have to report the purchase to the Receita Federal so they can tax you later on it if you sell. I can't see that they could require you to declare any home you had in the USA. I doubt highly they even can require you to declare home purchased in the USA during the tax year.

Strange if your company has hired "tax experts" to do your taxes that they don't have the definitive answers to your questions. Don't sound very EXPERT to me!!!!

Cheers,
William James Woodward. EB Experts Team

Hi William,
Hopefully this is a simpler question on tax.. I am working here for a few months and will then leave for the US.. I noticed that my paycheck from the Federal Government (a University here in Brazil) deducts taxes.  People tell me that I should be able to get back those taxes since I do not reside permanently in the country.. I am here only for 4 months.. Is this correct? and if so, how do I go about applying for reimbursement?  Nobody around seems to know..
Best,
Amir

If you reside in Brazil for more than 183 days you are considered a resident for tax purposes regardless of your immigration status. If you earn income through a Brazilian company they are required to deduct taxes before you are paid.

If your total income (including taxable benefits) for the year is less than R$25.661,70 then you will receive a refund for those taxes deducted. You will be required to file a DIRPF "Declaração de Impostos de Renda - Pessoa Física) in order to obtain the refund. Just so you are aware, the deadline for filing was midnight April 30th. I'm not sure about the late filing fines here in Brazil, if they apply only if you actually owe taxes (like in many countries) or if you're fined even if they owe you the money.

If you're an American citizen you are also required to file an annual 1040 regardless of where you reside and you must report your Brazilian income as part of your "worldwide income". Note that there is no Tax Treaty between the USA and Brazil.

Cheers,
William James Woodward, EB Experts Team

Thanks William,
I will be residing for less than 180 days and the income/stipend has just started; so I gather someone will have to file on my behalf since I will be gone by August... but then how will they pay me? any ideas?
Best,
Amir