Taxes In Brazil: Everything You Need To Know 2025

Foreign residents in Brazil must file taxes on global income, with rates up to 27.5%. Capital gains, real estate (IPTU), business profits, and foreign transfers are also taxed. No tax treaty exists with the U.S., so dual filing may apply. Tax rules are complex—professional guidance is advised.

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What Are Your Levels Of Taxation In Brazil?

When you are a legal resident of Brazil, you’ll need to file a tax return here. “Resident” here includes foreigners holding permanent visas, and also those holding temporary visas and a work contract.

As a general rule, if you are a U.S. citizen residing in Brazil, you’ll still have to file a U.S. return.

Foreigners with tax residence in Brazil must pay tax on income generated in Brazil or elsewhere, unless it is exempted through a double taxation treaty. The United States and Brazil do not have one at this time, though Brazil and Canada do.

Reviewed By Lief Simon

Lief Simon is the managing editor of Global Property Advisor, Simon Letter, and Offshore Living Letter. He has purchased more than 45 properties, investing in 23 different countries around the world.

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Ordinary income is taxed on a graduated scale. Low-income individuals pay no tax, and the maximum marginal tax rate currently is 27.5%. It’s best to consult an accountant in Brazil, but the following passive income sources must generally be reported:

Interest payments and dividends from foreign sources
Rents received
Most investment income
Income from business activities (except for dividends from Brazilian companies and interest income from savings accounts held in Brazil)

Returns must be filed by April 30 each year, and can generally be done via the Receita Federal website.

Real Estate Tax In Brazil

Capital gains are generally taxed at a flat 15%, but payment is due when the gain is realized, not the following April 30. There are some exemptions, such as the rollover of the gain from sale of your residence to buy a new residence within six months.

Note that when a property is sold in Brazil, Brazilian residents must pay capital gains in Brazil. Currently, non-residents would be required to pay taxes in their home country but not in Brazil.

For instance, some exemptions may be recognized in the United States (or other home country), but some may not, and laws change, so consult an accountant versed in international tax law.

IPTU (Imposto Predial Territorial Urbano)

The more upscale the neighborhood, the higher the tax. IPTU will generally run between 1% to 2% annually. (Note that in Brazil tenants are generally expected to pay the IPTU, as well as any monthly condominium fees, but these often aren’t included in the quoted rent—so be sure to ask before signing any lease.)

Currency conversion at today’s exchange rate.

Business Taxation

Smaller companies are generally taxed at 15% of net profits from operations, regardless of the type of business.

For example, there is a supplemental tax of 10% on any portion of net profit which exceeds 20,000 reals a month. Additionally, there is a social security contribution of 9%.

Foreign-Exchange Transaction Tax

If you are moving large amounts of money into the country, please be aware that Brazil enforces a foreign-exchange transaction tax (IOF) of 0.38%.

The issue of taxation is generally complex enough when discussing a single country. Involving another country obviously complicates matters. Everyone’s situation is a bit different, and tax regulations change. Accordingly, use the information in this section as a starting point, but seek the advice of a qualified tax planner before making important decisions or transferring assets.

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Lief Simon is the managing editor of Global Property Advisor, Simon Letter, and Offshore Living Letter. He has purchased more than 45 properties, investing in 23 different countries around the world.

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Taxes In Brazil: Everything You Need To Know 2025- FAQs

How Does Sales Tax Work In Brazil?

Brazil has a system with different tax rates for ICMS (Imposto de Circulação de Mercadorias e Serviços), which is charged by each state. The usual ICMS rate is 17%, but it is 18% in São Paulo, Minas Gerais, and Paraná, and 19% in Rio de Janeiro.