Tax In Brazil

A Contractor's Guide to Taxes : 

One of the most consistently challenging aspects of contracting in Brazil is complying with the country’s tax system. As well as paying tax in Brazil, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge.

How do I calculate my taxable income: 

If you’re working in Brazil under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Brazil for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Brazil, but contractors may not be offered this service because of their short stay with each employer.

Anybody who can’t pay their tax in Brazil through PAYE is left with the prospect doing everything themselves.

Do you know much about Brazilian Tax Law? Does Brazil have a tax treaty with your home country? You will need to find out or find someone who can help! Income tax in Brazil can range from 0 to 27.5 percent, and you need to be sure you are placed in the correct tax brackets.

Tax Calculator: 

If you are a contractor and want a calculation on your tax and net retention in Brazil, we can supply it to you free of charge.

Using an Umbrella Company for Income Tax : 

Contractors in Brazil are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Brazilian umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).

The companies are experts in Brazilian taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Brazilian tax office or tax department directly including processing your tax refund if you are eligible.

How We Can Help You with Tax: 

We work with numerous umbrella companies in Brazil, many of whom are experts in tax and immigration laws. If you have any questions about tax in Brazil, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Brazilian work permit.

Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in Brazil but without the overhead of directly dealing with the Brazilian tax authorities. Get in touch with us today for some reliable advice on tax in Brazil!

When Do You Need to Lodge Your Tax Return?: 
30 April
Tax Filing Deadline : 
30 April
Can you file it online? : 
Yes, https://cav.receita.fazenda.gov.br/autenticacao/login
Currency: 
Brazilian Real (BRL)
Tax-free Threshold in: 
BRL1,903.98
Grossed Income: 
0 - 1,903.98
Tax Rate: 
0%
Grossed Income: 
>1,903.98 - 2,826.65
Tax Rate: 
7.5%
Grossed Income: 
>2,826.65 - 3,751.05
Tax Rate: 
15%
Grossed Income: 
>3,751.06 - 4,664.68
Tax Rate: 
22.5%
Grossed Income: 
>4,664.68
Tax Rate: 
27.5%
How long does it take to set up: 
101.5 days
How much does it cost: 
BRL1,184.03 – BRL1,334.03
Is it easy? : 
Starting a Business Rank: 176/190 (Source: World Bank)
How to File Taxes in: 

You can file taxes in Brazil online or taxes on your tablet or mobile phone via the IRPF app which can be downloaded here.

Filing Taxes Online

Step 1: Obtain Access Code for e-CAC

You can apply for an access code on the Receita Federal do Brasil’s (RFB) website by following the link here.

You will need the following information to register for an access code:

  • Your CPF
  • Date of birth
  • The 10-digit receipt number for the previous year’s personal income tax return

Alternatively, you can access e-CAC by obtaining a digital certificate. The RFB’s website provides taxpayers with a list of links to Authorised Certification Authorities here.% You can apply for a digital certificate on the website of the Certification authority you have chosen.

Step 2: Log in to e-CAC

Using your access code or digital access, log in to the e-CAC portal here.

Step 3: File Taxes

A comprehensive guide (in Portuguese) on how to file taxes using e-CAC can be found here. It is recommended that you consult a translator or tax specialist, as all instructions and prompts on e-CAC are written in Portuguese.

Notes: 

Tax Rates for Non-Residents: Non-residents are subject to a flat employment income tax rate of 25% (with no deductions allowed).

Deductions: Deductibles from an individual’s annual taxable income include dependants (a specific amount specified by the tax authorities every year), alimony payments, tuition expenses, medical expenses, social security contributions, and private pension contributions.

Does the 183 day rule apply in: 

Yes

When do you become a tax resident in: 

You become a tax resident in Brazil when:

  • You are a Brazilian citizen living in Brazil;
  • You are a Brazilian resident living abroad within the first 12 months of your departure (if the exit process has not been filed);
  • You are a naturalised foreign national living in Brazil;
  • You are a foreign national and a holder of a permanent or temporary visa under an employment contract with a Brazilian entity;
  • You are a foreign national, a holder of a temporary visa without an employment contract with a Brazilian entity, and have stayed in Brazil for at least 183 days within a 12-month period; or

You enter into Brazil under a temporary visa to work as a doctor under the ‘Mais Médicos’ program.

Am I taxed on my global income in: 

Residents are taxed on their global income. Non-residents are taxed on their Brazil-source income only.

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