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Brazil: News and deadlines for submitting Individual Income Tax Return and Foreign Assets statement for Brazilian Central Bank – 2021

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In brief

Brazilian taxpayers can already submit their Declaration of Foreign Assets, which is due on 5 April 2021, to the Brazilian Central Bank (DCBE). The declaration must be filed by individuals or legal entities resident, domiciled or headquartered in Brazil, with foreign assets in the amount equal to or greater than: (i) USD 1 million on 31 December 2020; and (ii) USD 100 million on 31 March, 30 June and 30 September of each year base. Please note that until last year, this threshold amount was USD 100,000 for the annual statement.

Besides the information already required by the Brazilian Central Bank, there are new fields included this year for individuals who own 10% or more interest in foreign companies. In particular, information about the decomposition of the company’s results will be requested, more specifically information about: (i) the results of non-recurring items; (ii) the results of revaluation of assets or liabilities (e.g., impairment); and (iii) the results from exchange variation.

The Individual Income Tax return program for calendar year 2020 is also available and the deadline for filing the tax return is 30 April 2021. Among the news highlights disclosed by the Brazilian IRS this year are the following:

(i) the creation of three specific codes for cryptocurrencies in the assets tab of the return, as follows:

  • 81 – Bitcoin cryptocurrency
  • 82 – other crypto currencies of the digital currency type (e.g., Ether, XRP, Bitcoin Cash, Tether, Chainlink, Litecoin)
  • 89 – other crypto currencies (payment tokens)

(ii) the possibility to receive refunds by “Payment Accounts” (e.g., fintechs)
(iii) the possibility to send information about additional distribution of the decedent’s estate without need to amend Estate Final Tax Return
(iv) the requirement to declare the amount received as “emergency aid” during the COVID-19 pandemic period as taxable income
(iv) the possibility to obtain the pre-filled tax return through access to GOVBR
(v) the possibility to obtain the income information received by dependents, if the declarant has an electronic power of attorney granted by the dependent

We are available for further clarification about the matter.

Click here to read the article in Portuguese.

*In cooperation with Trench Rossi Watanabe, a Brazilian law firm.

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Author

Marcos Vinicius Neder joined the Firm in 2011 as Partner. He coordinates the Tax practice group, with focus on tax litigation. He also supports clients in business tax consulting (national and international), taxation of reorganizations and acquisitions. He is the Head of Wealth Management area in the office. Marcos Vinicius Neder has a wide breadth of experience in national and international taxation. He represents clients in the oil, mining, civil construction, commercial, services, cement, polymers, oil and gas, cosmetics, telecommunications, real estate development, food and financial institutions segments. Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.

Author

Flávia Allegro Gerola joined the firm in 2011. Flávia concentrates her practice and coordinates the Wealth Management group, focusing on tax advice for individuals and Family Offices, domestic and international succession planning, structuring investments inside and outside Brazil, pre-immigration planning, expatriation and global information exchange. She also works on tax planning for legal entities and on tax administrative litigation.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.

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