Taxes for expats in Brazil

@Cheryl

Hi Cheryl,

I am in a complicated situation and I can use some advice.

Me and my fiancé met 10 years ago in South America. She is a Brazilian citizen and I live in Western Europe.

I have lived in Brazil for 2 years, and we decided to come to Europe together. She studied our language, got a college degree here and now has a consistent job for 2 the last 2 years. She pays her income taxes here.

We have been in a legal battle with our national migration service for 2 years. They are trying to prevent as many immigrants as possible from obtaining permanent residency here, but we won the case and she now has the right to stay here permanently.

However..

She owns a property in São Paulo. It is in her name, and her mother still lives there. In the long run, we are in doubt if we want to live here or there. She has never officially left Brazil (Declaração De Saída Definitiva Do País). I think that she is still paying property taxes in Brazil. But not income taxes, because she pays them in Europe. Her European bank account and her salary here are not registered with the authorities in Brazil. We want to avoid double taxation, obviously.

Until 2 years ago, she received monthly allowances from the Brazilian government because her father passed away as a police officer. An old law says that children of such police officers keep receiving this allowance, until they are married or have children. To keep receiving this allowance, she has to declare that she is not married or has children every single year in Brazil.

But because we were in this legal battle in Europe, she was not allowed to leave our country until we won the case about her citizenship. So she could no longer make that declaration.

She has not received the allowance for 2 years and we have heard that it is in a blocked account. She can get it back soon (we are coming to Brazil in 2 weeks) depending on her declaration when we go there.

She is not married at this point, but we are getting married in september. I don't know what we have to declare.

I also do not know if it is wise for her to give up her tax residency in Brazil. Because taxes in my country are much higher.

I am a medical doctor in Europe and since 2 years ago I have successfully invested in crypto currencies.

However taxes on those profits are huge in my country. Therefore I consider donating the crypto assets to my wife, and she can cash them out under Brazilian tax laws which are much more favorable. But I don't know in which country she is supposed to pay those taxes at this point.

Can she be a tax resident in 2 countries and choose by herself?

I think that not declaring foreign bank accounts (The European bank account not registered in Brazil, and the Brazilian account not registered here) is a dangerous game that will backfire in the future. But she absolutely doesn't want to take my advice and declare them. Especially if we marry in Europe in september and she still keeps receiving allowances in Brazil, I am pretty sure she will have to pay everything back in the future with giant penalties on top.

I don't know if the Brazilian tax authorities can also demand tax on her income salary from Europe, that was not declared in Brazil. She has already paid those taxes here, but officially she is a tax resident in both countries now.

06/01/25 @Woot.  Good morning.  I've reviewed your prior posts, and am happy for you two that your fiancée's immigration case is finally resolved.  Congratulations.

Before you get married, your fiancée should find a Brazilian lawyer that you two feel comfortable with -- in person would be ideal, but remotely through referrals from friends and family may be enough for now, to help her resolve, in order of urgency,

1. her tax status in Brazil -- she probably should have been filing declarations every year since she's still a tax resident, but that doesn't necessarily mean that she owes anything.  Brazil has strong policies against double taxation and as you say, EU taxes are higher;
2. her status with respect to her survivor's pension.  She's probably due the back payments, and if so, a lawyer can probably help her to update her paperwork and get them.
3. her future status with respect to the pension:  that should be resolved prior to your marriage.  It sounds like she's not in violation of the terms yet, so she doesn't want to be by leaving this undone.

As for the crypto question, consider discussing that with the attorney only when and if you've built up a level of trust with him or her that makes you comfortable.  Good luck.

Can you give me an idea of what a Brazilian tax lawyer costs? I have been looking for prices but they usually don't mention that on the website. I'm not sure if he has to be from her city. Maybe it can be done with video calls online. I don't like it when hourly rates are not mentioned on the website because it allows lawyers to set higher prices for foreigners.

My wife is worried about the payments (survivors pension) that she missed out on. She wants to make sure that she gets those back first. However, if she declares that she is no longer a resident in Brazil and hasn't been a resident for the last 2 years, maybe that would be an argument to keep the payments from her. I think that this is why she wants to wait with that declaration.

You could make a case that someone who isn't a resident anymore, is no longer entitled to a survivor pension.

This article here

https://www.eurodicas.com.br/imposto-de … o-brasil-0

And this one

https://www.eurodicas.com.br/declaracao … a-do-pais/

strongly indicates that my wife has to declare that she is no longer a resident in Brazil. She can prove that too. She has been working consistently here and she has an address here.

I do wonder if Brazilian authorities will ask details of her bank account here, even if she is no longer a resident in Brazil.

06/01/25 @Wout.  The "honorário" suggested by the OAB -- Ordem de Advogados do  Brasil -- for an initial consultation with an attorney is one Salário Mínimo, currently R$1518.  After that, fees are negotiable based on the scope of the work proposed.  The fee for the initial consultation is also negotiable, and some attorneys, especially new ones, may even waive the fee for the initial consultation.  Naturally, you want to ask about charges first thing.

Whether your fiancée is still eligible for the pension or not depends on the terms of the pension, which an attorney should be able to determine easily, while advising her on the timing of changing her tax residence, and how to address the declarations that she hasn't filed with the Receita Federal.  I would doubt that merely moving abroad without changing her tax residence would void the pension and that changing her tax residence might, but that's just a guess. 

As to whether the Brazilian authorities would ask for details of her bank account there, the lawyer will undoubtedly tell you about that as part of the discussion of her tax status, and how to field the questions.  If either or both of you transfer significant funds to Brazilian accounts from foreign accounts, the Banco Central do Brasil will require significant documentation of your legitimate ownership of the funds.  This is not for tax purposes, but as part of their auditing to detect money laundering and profits from illegal activities.

@Wout

I think @abthree has given you some very sensible advice, but you really do need to find a suitable tax attorney in Brazil, and maybe even more than one. In my experience, most will grant you an initial interview for free, then you can choose which one to go with.

The problem is that tax matters in Brazil are very subjective, advice can vary enormously, and most attorneys will not have a great deal of experience in this field. This is because they have to pay for training in specific modules that are not part of the basic course, and dealing with international questions such as yours is definitely not part of the basic course! But I can guarantee that it will cost you a lot more than 1 salary in the long term to resolve...

Look at other threads on this forum, and you will see how advice on tax matters in Brazil for foreigners varies enormously. For example, some posters advocate that a foreigner moving here should pay little or no tax on their overseas income, others have actually refused to move to Brazil beacuse this will be so high... How can both be correct?

By way of illustration, I was talking to a Brazilian attorney 12 months ago about a real estate problem he had (strangely, I knew more than he did). He spoke excellent english, and told me that he worked for a sizeable law firm in Recife.

So I asked which aspects of law his firm dealt with, and he told me all of them. Then I asked if his firm might be interested to advise foreigners about tax and immigration, and he responded that those were 2 specialities that they did not work with...

@abthree

Thanks for the extensive reply.

I have tried to give advice to my wife, but she is very stubborn. Teimosa.

In her view, and this also seems to be her mothers view, the first thing they want to do is go to the local bank and answer the questions they used to answer in previous years.

Are you married? No

Do you have children? No

Both want to make it absolutely sure that she will receive the allowances that were missed in the last 2 years.

They also expect questions about why she was not in Brazil in 2 previous years, but these would come from the police. Her answer would be that she studies abroad. But studying here would not prevent her from flying abroad, and I think they know that. The real reason why she was not in Brazil is because she has a job here and because her application for permanent residency in Belgium was pending. And while it is pending, no applicant can leave and expect to come back until it is approved. It was pending based on coabitação with me. I assume that they can find out about this, and this endangers her allowances because not being in a serious relationship is a criterium for keeping them. I think that lying about our relationship is dangerous, and if she denies it in Brazil I am not 100% sure that her permanent residency is safe here in Belgium.

In my opinion it is critical that she leaves Brazil (end of holidays = 30/6) with an official declaration that she is no longer a tax resident. But this is my opinion, and it does not seem to be hers. She just wants the allowances and keep things going like they have been for the last 2 years. Not changing her tax residency in Brazil and not declare her foreign income.

I have warned her but then she calls me a pessimist.

With regards to the tax lawyer. Can you not imagine a scenario in which we end this trip with a declaration that she is no longer a tax resident in Brazil, and that everything is resolved automatically after that? I think that most people consult tax lawyers when they get a tax bill that they don't agree with. So far we have not heard anything. And we can prove that she is a resident here, and paid her income taxes here.

06/03/25 @Wout.  You are absolutely right about one thing in particular, and it's the most important thing:

LYING TO THE BRAZILIAN AUTHORITIES IS THE VERY WORST THING THAT A PERSON CAN DO!!!!!

The reason that I'm so convinced that your fiancée needs to talk to a lawyer is that she's going to need a cover story for the past two years that she's going to have to repeat to several people and organizations.  It should be basically truthful because the truth is always easier to remember, and you can't get caught in a lie if you're not lying.  The lawyer can help her formulate the story so that it answers all the common questions and, just as importantly, doesn't invite new ones.  I'm speculating here, but it's probably going to talk about her work, and work responsibilities keeping her from returning to Brazil.  It will probably be clear that you're going to get married, but that you're not married yet.  It will probably include that she's been paying her European income taxes in full and on time.  It's probably not going to say that she was studying unless she actually was, or talk about her immigration case, or crypto, or anything else that's not directly relevant to getting her Brazilian documentation straight and getting her money.

She's going to need to tell it to the Receita Federal (RF) to regularize her tax status.  From your story, I'd say that's Job #1 for her and the lawyer, and everything becomes a lot easier once that's squared away.

She's going to need to tell it to the bank to get her pension flowing again and to get the back payments, and the question of her status with the RF will probably come up, and she'll need a good answer. 

She's going to need to tell it to the agency that's the source of the pension, either directly or through the bank.  Again, the subject of the RF will probably come up.

She's going to have to accept that the pension will end when you actually do get married.  The lawyer may see a way around that, but from the facts as you've laid them out, I don't.

Your final question is so good that I'm just going to quote it:  "Can you not imagine a scenario in which we end this trip with a declaration that she is no longer a tax resident in Brazil, and that everything is resolved automatically after that?" 

Yes, I can, but the non-residency declaration is the last step, after everything else is cleaned up, not the first step.  Before the RF processes her declaration, they'll almost certainly check their records for her past activity.   They'll either find a resolution already in their files, or they'll find no record of her for the past several years, and start demanding answers.  If you find that as a result of the tax treaty she doesn't actually owe any taxes in Brazil and probably won't in the future, then non-residency becomes optional, or at least less urgent.  And in the worst case, if you find that she does owe more back taxes than your can handle, only you and the lawyer will know that, and you can come up with a Plan B.

@abthree

Thanks again for the time and the effort.

One more scenario that comes to my mind. I am not sure if this could actually work.

We are flying to Brazil next week. On friday, she will go to the bank and to the police to answer questions.

Assume that she can explain why she was not in Brazil for the last 2 years.

"I was a student at first. I was offered a full time job when I did not expect it. I have been in the process of getting permanent residency for the last 2 years and I therefore I was not allowed to leave the country and visit Brazil".

These answers are truthful and they do not mention me, her fiancé. Even if she does mention me and the fact that we live in the same address here, we are not married at this point and it does not affect her monthly government allowances.

When the police are satisfied with the answers and decide to pay her back that money (imagine that this months after our trip in Brazil) we do consult a tax lawyer and declare that she is no longer a resident in Brazil. But this would happen after she has received the missing monthly allowances. And she would have to make that declaration from Belgium, after leaving Brazil.

I don't know if declaring that you are no longer a tax resident is something the applicant can do when he or she chooses to do so. Or it is mandatory to sign such a declaration immediately when the police ask why she has not been in Brazil for the last 2 years.

Her fear is that when she declares that she isn't a tax resident anymore, she will miss out on all monthly allowances of the last 24 months. I don't think that will happen, because I don't think she has violated any rules. But it is on her mind.

I think that only a tax lawyer knows this. I'll offer to pay one for her, but I highly doubt that she wants to go there and listen to the advice.

06/05/25 @Wout.  I think that sounds like a better plan.  Good luck with it.  She should answer any questions truthfully, but there's no need to volunteer additional information that's not requested, unless it will help her make her case.

If I recall correctly, her pension is from the local police in São Paulo.  In that case, I doubt that the police will care one way or another about whether she's a tax resident, or that that subject will come up with them -- that's between her and the Receita Federal, and there's no connection between the two.  Unless there's a requirement for her to actually be living in Brazil to receive the pension, she remains eligible to receive it until she gets married, as you've described it.

Declaring that your fiancée is not a tax resident anymore is something that she does herself with the Receita Federal at her discretion; there's no need to do it before talking to the police.  When she's ready, the instructions are here:

https://www.gov.br/pt-br/servicos/comun … va-do-pais

There are no tax incentives in Brazil for foreigners

They should do like Uragray's incentives for 10 years

Portugal is proposing a 500,000 euro investment and a 10-year tax incentive.

06/13/25 There are no tax incentives in Brazil for foreigners They should do like Uragray's incentives for 10 years Portugal is proposing a 500,000 euro investment and a 10-year tax incentive. - @jc1234

If Brazil were interested in incentivizing immigration, those could pretty good ideas.  But consider:  Uruguay is a little smaller that Rio Grande do Sul, with about a third the population; Portugal is similar in size and population to Pernambuco (19th out of 26 states in area).  Numbers that might move the needle in those countries would be lost in the rounds here:  Brazil is too big for those types of programs to scale effectively.

Moreover, there is currently zero organized internal opposition to Brazil's immigration policies:  from the extreme Left to the extreme Right, there's broad consensus that the country's got immigration about right.  On the other hand, there is a serious, ongoing, multi-sided debate about the size of the tax burden, the way it's distributed, and how it relates to expenditures.   The debate is especially intense this week as it happens, and the idea of giving tax breaks to rich foreigners to move here isn't one likely to gain traction with any of the sides.

06/13/25 There are no tax incentives in Brazil for foreigners They should do like Uragray's incentives for 10 years Portugal is proposing a 500,000 euro investment and a 10-year tax incentive.  - @jc1234
If Brazil were interested in incentivizing immigration, those could pretty good ideas. But consider: Uruguay is a little smaller that Rio Grande do Sul, with about a third the population; Portugal is similar in size and population to Pernambuco (19th out of 26 states in area). Numbers that might move the needle in those countries would be lost in the rounds here: Brazil is too big for those types of programs to scale effectively.

What a well informed response @abthree.

I was in Uruguay a few weeks ago, and have visited Portugal dozens of times. Perhaps @jc1234 could indicate the industries these countries enjoy that attract foreign investment? They both have virtually nothing but tourism, which is not the same with Brazil. Hence the difference in immigration and inward investment incentive.

That is not to say that us foreigners would not enjoy a little financial benefit, but it simply is not going to appear high on the Brazilian Government's agenda any time soon...!

With Lula seeking reelection the Real will take a beating still. They need all the foreign inflows they can get. Two weeks ago there was a huge backlash when they try to increase the rate of the IOF to try to counteract outflows. Only reason why the Real isn’t above 6 now is because of the tariff threats and the dollar pullback.

Not withstanding the 15% interest rate on their bonds due in 10 years with rates not falling below 10% in the next 3 years.

@Cheryl

I am a UK national, taxation is an issue I was going to ask about. In November 2023 the UK and Brazil agreed to a single taxation system, so I believe. It has been double taxation and is still double taxation as I understand. I learned the UK Parliament has ratified the agreement, but the Brazilian National Congree is yet to put this agreement into effect.

Does anyone know when the new taxation procedure comes into effect, when Brazil will confirm the agreement of 2023?

I bought a home in Brazil, I have CPF, my partner is currently living there. I am in UK getting medical treatment and I have not taken residence in Brazil, just travelled back and forth before medical complications arose. . I have not had to pay tax in Brazil as I have not moved there beyond staying within the 6 month allowed without a visa.

I am hoping when my medical treatments are completed, the NHS has been very slow to proceed,  I will be moving to Brazil.

I pay 20% tax in UK, I believe I could be paying 27% peak band iin the graduated system f I lived permanently in Brazil.

I am hoping the tax agreement between UK and Brazil will be law soon. UK has tax agreements with many countries but Brazil is still pending.

Does anyone know if and when the issue will be implemented in Brazil?

@DavidPH

I am a Brit, who has been living here permanently for 18 years.

The tax question is complicated, and lots of people have opposing views, as has been explained before. Some believe, as I do, that you should pay taxes in the UK (in this case) on UK funds, and Brazilian taxes in Brazil on Brazilian funds, others that the tax burden in Brazil is excessively high on all worldwide funds and it is not worth living here as a result. Certainly if you offered to pay taxes on all funds in both countries I think the governments involved would be most grateful...!

On the specific question of a double taxation treaty, there is already a clause in the Brazil Constitution that makes it illegal to charge taxes on funds that have already been taxed once, but beyond that I have no further information about its implementation.

You do not make it clear in which country the funds are being earned, if you intend to transfer funds internationally, nor your visa situation - for example will you continue to be a "tourist"? On what immigration basis might you seek to live here permanently?

As all tax situations are very subjective, you might want to seek professional advice on your specific case, but for me to avoid (not evade) taxation is a normal, and quite acceptable, way of life...

@Peter Itamaraca

Thanks for your information. I am retired, so my only income would be from pensions in UK, taxed at source, a tax-free allowance of £11,275 (I think) then 20% on the above of the allowance level.

The taxation implications has been a concern to anticipate. I've not yet been advised by professionals.

Unexpected health problems has messed up the plans exactly this last year, but marriage, in UK or Brazil, is the anticipated step. The locality is NE Brazil, RN.

UK has introduced some very stringent requirements for a spouse from abroad to live here too, as you may have heard (something like having £38,500 annual income to sponsor a family member from abroad.).

Currently I'm here until several medical issues are resolved on NHS, just now trying to estimate what my income after taxation woUld be in the future.

Do I understand you in that the existing rules would be I deduct what I have paid in tax from my gross income, then that amount could be the basis for Brazil calculating tax?, in effect nullifying the UK tax free allowance, but getting some tax free allowance according to the Brazilian graduated system?

I presume that a single taxation system arising out of the 2023 agreement between UK and Brazil, which I think has not been legislated on in Brazil yet, would be more generous.

2026, if all gets done medically, is the expected date, I have the CPF which was a requirement for purchasing property from abroad, not the visa application..

@DavidPH

I think the tax free allowance on income/pensions in the UK currently stands at £12,570, then 20% up to some £50k, then 40% to £125k, and 45% above that.

Most UK retirees I know receive their pensions in the UK, pay UK tax as required, then transfer some funds to their bank accounts in Brazil as savings (non-taxable), or simply use UK debit and credit cards as though they were on holiday. This is on the basis you will remain a UK citizen, and perhaps seek a permanent family reunion visa through marriage. You could also transfer some funds to your Brazilian partner's account as a gift...

The Brazil tax system is extremely complicated, and I know of no one who understands it fully! However the good news is that if you fail to pay tax due, you will simply have to pay a fine and interest, you will not get thrown into prison! (That is assuming there is no criminality involved, like drugs, etc.) Why pay for someone to be imprisoned when the state can make much money but making you pay the due amount plus interest and fines...

@DavidPH

It is also worth noting that there is not a flat rate of 27.5% tax on income, as some people have mistakenly stated. It depends on the monthly income, and ranges from 0%, 7.5%, 15%, 22.5% and finally 27.5% - all depending on the income band, which can change every year.

Re: Proposed US Remittance Tax in Trump/GOP tax bill

The so-called Big Beautiful Bill (BBB) includes Remittance Tax for money sent from the USA to another country.

The original proposal was a 3.5% remittance tax on *non-citizen* remittances from the USA. US citizens were originally excluded.

But in the latest version just sent to the US House of Representatives the proposed remittance tax has been reduced to 1% with NO EXCLUSION for American citizens. So, if passed into law this tax will affect any US expat in any country who receives US based income transferred to a foreign country.

Source: POLITICO

”…lawmakers are dropping plans to shield U.S. citizens from the tax on money sent overseas, which had been aimed squarely at undocumented immigrants.”

https://www.politico.com/live-updates/2 … e-00433068

07/02/25 @Ipanema777.  Thanks for the heads-up on this.  Expats thinking about purchasing and/or renovating properties using US funds may want to consider accelerating their plans.

UPDATE TO BBB REMITTANCE TAX FOR US CITIZENS OR THOSE WITH ASSETS IN THE USA:

Re: Remittance tax law change

The bill (proposed law) language is now only 1%, as stated previously.

But after large banks complained to Congress they received an exemption from the tax that *appears* to also apply to services like Wise, Xoom, Remitly. (See bill language at link below).

So under the BBB bill language bank-to-bank transfers will NOT be subject to the 1% tax, while payments made WITH CASH (or cash equivalents) via Western Union, etc will be taxed at 1%.

Transfers via Wise, Xoom, and Remitly should  NOT be subject to the 1% tax if the source of those funds comes via transfer from a US bank (or “credit union”).

Result: the mostly illegal immigrant Latinos doing the most difficult work and getting paid in cash in the US will pay the remittance tax, while the Indians on HB-1 visas taking jobs from US Microsoft and tech employees will NOT have to pay the tax if they transfer from a US account. (Microsoft just announced laying off 9,000 employees this week.)

https://x.com/onthenewsbeat/status/1939 … wbNTQq8gww

07/04/25 The US Social Security Administration issued this announcement late last night:

"The Social Security Administration (SSA) is celebrating the passage of the One Big, Beautiful Bill, a landmark piece of legislation that delivers long-awaited tax relief to millions of older Americans.

The bill ensures that nearly 90% of Social Security beneficiaries will no longer pay federal income taxes on their benefits, providing meaningful and immediate relief to seniors who have spent a lifetime contributing to our nation's economy."

US citizen expats receiving Social Security will probably want to confirm the individual impact with their tax advisors. 

Wishing you all a Glorious Fourth!