Hi, I'm considering purchasing a property in Brazil and know I will need a CPF.

Can anybody tell me if the following are correct?

This means filling in an annual tax return.
Being a non-resident this would only include declaration of Brazilian sourced income.
If I don't buy for a few years, I would not have any liability in Brazil and could fill in a tax-exempt form each year.
Once purchased only income from the property would be liable for tax in Brazil, if that is all I have in Brazil (not including a minimal bank account).
Would I need a Brazilian resident to act as attorney for my interests in Brazil (either friend or lawyer)?

Many thanks for any help

You only need to file an annual tax return if you are a resident (some type of permanent visa) in Brazil.

AS a non-resident, you will only have to file a Tax Waver that is easy to fill (at any post office) and costs R$2.40 for each year.

Thanks Boris,

Is that so even if I have say rental income from the property. OK this could be paid outside Brazil, but if it was local ?

I doubt that your rental income would exceed the R$12K and change annual exemption below which nobody pays federal taxes, but even if you do... there is a tangle of legal and fiscal matters to deal with if you wish to pay the taxes that can only be resolved on location with a very expensive help from local legal pros...

Boris,

Is that to say that income from renting out an apartment in Brazil is significantly below R$12,000?

Thanks,
David

Participants, the implications of having a CPF card are the following:

In order to keep and maintain your CPF number valid, once it has been issued to you, you have to do an income tax declaration or a declaration of exempt every year (except the year you received the CPF). This will depend on your taxable income and other circumstances, based on them, currently; we have the two options of declaration:

1. Declaração de Imposto de Renda:
If you earn R$ 12,696.00 or more per year. For a complete list of circumstances where one is obligated to do such declaration, please visit the Receita Federal homepage at:
http://www.receita.fazenda.gov.br/PessoaFisica/IRPF/2005/Orientacoes/Obrigatoriedade.htm

2. Declaração de Isento de Impostos:
If you don't have income in Brazil or if it is less than R$ 12,696.00 per year. For a complete list of circumstances and requirements to do such declaration, please visit the Receita Federal homepage at:
http://www.receita.fazenda.gov.br/PessoaFisica/Isento/2005/Orientacoes/default.htm

Such declarações can be made by your attorney, CPA, agent or by yourself via Internet on the website of Receita Federal at www.receita.fazenda.gov.br.

The Declaração de Imposto de Renda is usually done in March and April and the Declaração de Isento de Impostos, in October and November of every fiscal year.

Careful is required when filling out the forms, as the information provided can cause legal consequences. This informative has not the intention to serve as legal advise on how to do yourself, it is merely explanatory, please always consult with a professional.

If you failed to file one of these declarations for the first year, your CPF will have a notation on your number and, if don't do any of these two declarations for two years the CPF will be suspended. In order to re-activate the CPF you will have to go to the nearest office of Receita Federal and justify why you did not do the declaration(s). If accepted, most likely, you will have to pay a fee and your CPF will be re-activated, but I advise, it is a big hassle to go over all of this, especially for those who do not speak Portuguese fluently.

Another important aspect is that, If Receita Federal notices one person who made several applications or even has multiple numbers, all of them will be permanently revoked.
Should you need additional information, please feel free to contact me.

Jose C. Santiago
Licensed Attorney - Brazil
Licensed Real Estate Agent - USA
Phones: (55-11)9348-5729 - São Paulo, Brazil
(800)983-7060 - Miami, USA
Website: www.josesantiagohomes.com
Skype: josecsantiago
MSN: josecordeirosantiago@hotmail.com

Hello Boris

I have been snooping around the Receita Federal web site and if I am reading it properly it looks like September 1 until November 30 of this year is the prescribed time period to file the Declaracao Anual de Isento do IRPF? There is an area on the page which appears to be a required field " No do Titulo Eleitoral."

What does a foreigner do to file online Isento and how does one address the Titulo Eleitoral issue?

Thanks for your help!!

Hello Jonny,

Titulo Eleitoral is not a required field. You do not have to provide it in order to file the Tax Waver form online.

Regards,
Boris

David,

It depends on the apartment. The sheer majority of rents for apartments in Brazil would most likely fall well below the taxable level.

Regards,
Boris

Boris - Isn't rental income in Brazil taxed via the 'Carne Leao', that is on a monthly basis and based on a monthly tax free base, and due and payable monthly? So if you had a seasonal rental, with high income part of the year you would be taxed during those months like that was the yearly income. If at the end of the year the total for all twelve months was less than the yearly tax free base you would receive a refund when filing your 'IRPF'. So for the 2005 IRPF filing, rental income (if this was the total of one's income in Brazil) would have been tax free if below R$1058 per month or R$12696 per year for he fiscal/calender year of 2004. I believe for the 2006 IRPF (2005 fiscal year) the maximum tax free was R$13968 per year and R$1164 a month per the 'Carne Leao'(05). This year's 2006 Carne Leao I think has a tax free base of R$1257 per month. The 2007 IRPF (2006 fiscal year) isn't out yet.
Well I might be wrong, and I probably didn't explain it well, but that's the way I understand it...but I'm no professional.
Good Luck to all!!

I read in previous postings of the need for filing out a tax waiver if you are not a resident of Brazil, in lieu of a tax return for foreign property owners. You mentioned that it is a mere R$2.40 and can be obtained at the post office.

Am I correct in thinking that this is separate and apart from the CPF Declaracao de Isento de Impostos?

And if so, is there a time period in which this waiver needs to be filed so as not to be in violation?

Thank you, this forum is excellent.

Sincerely,

Jonny

Hello Johny,

Actually the tax waiver and CPF Declaracao de Isento de Impostos are one and the same. This declaration can be filed on-line through the site of the Receita Federal at no charge. As far as the dates for each year are concerned, they differ and are actually set each year and announced beforehand.

Lifestyles Brazil has been announcing these dates for a couple of years already. So, all that is needed is to keep an eye on our site (or the site of the Receita Federal).

Regards,
Boris Goldshmit
Licensed Real Estate Broker – Brazil
CRECI RJ 35267

CALL: +1 (718) 395-1861 USA
CALL: +44 020 8144 8370 UK
CALL: +55 21 9149-6856 Brazil

SKYPE: lifestyles.brazil

Hello Boris,

If I am not mistaken I believe it is possible for non resident CPF holders to file an online Brazilian income tax waiver? If so, in what time frame must this be done? I thought it was in September or October? If you could include the link that would be very helpful.

I noticed on another posting that you may have a Branch manager in Rio that can actually achieve a bank account for foreigners without a permanencia? If so I would like very much to get that persons info. Thank you.

Jonny

Hello Jonny,

Just follow our site we post dates and links for filing DAI (Declaração Annual do Isento) annually. I am not sure about the dates for this year, but last year the last day to file DAI was the thirtieth of November.

I think the post about the branch manager willing and able to help non-resident foreigners to open a bank account is at least three years old. The bank that was "foreigner-friendly" has since been acquired by Bradesco, the Central Bank o f Brazil has also changed its regulations that caused even the possibility of a non-resident foreigner opening a bank account to disappear completly (except the CC5 accounts which are mostly sabotaged by the banks).

Regards,
Boris