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.