RFB - Revenue regulates taxation of foreign remittances

Date / Time: 01/26/2016 - 15:40:47
RFB - Revenue regulates taxation of foreign remittances
IN published today provides for the levy of withholding tax on income paid, credited, employees, delivered or remitted abroad

Was published in the Official Gazette today, January 26, the RFB Normative Instruction 1611, which provides for the levy of Income Tax Withholding on income paid, credited, employees, delivered or remitted abroad.

With the expiration of the exemption on remittances abroad aimed at paying tourism services, the amounts remitted have come under the incidence of Income Tax Withholding (IRRF) at a 25% rate. Importantly, the incidence of IR only occur in cases where there is remittance income which, for the most part, occurs in the case of payment of service as, for example, the case is referred to payment of hotel, transportation , cruise lines and travel packages.

In the case of shipment to purchase tickets directly made of air or boat domiciled abroad, the withholding tax rate is 15% and may be no impact if the company's home country does not tax remittances to Brazil (reciprocal treatment ).

The end of the exemption does not alter the cases in which there was no incidence of IR, or not be characterized as income payment, as in the case of transfer bank of the same ownership accounts, or because there is no legal provision for levy of withholding income tax, as in the case of import of goods.

The Instruction states of the non application in the case of remittances abroad for educational purposes and for coverage of medical expenses for health care abroad, the sender or their dependents.

Read IN 1611 here.

Source: Federal Revenue of Brazil

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