Taxes in Brazil in 2026 for foreigners and expats

Tax rates in Brazil in 2026: the short version

Since 1 January 2026 Brazil has taxed dividends at 10% - they had been tax-free since 1996. The same Law 15,270/2025 cut income tax to zero on salaries up to $1,100 (5,000 Brazilian reais) a month and introduced a minimum tax of up to 10% for anyone earning more than $130,000 (600,000 reais) a year. The burden has shifted from employees to business owners.

The real, written R$ in documents, is the national currency. At the Central Bank of Brazil rate in October 2026, 1 US dollar buys about 5 reais; amounts below are in US dollars with the sum in reais in brackets. Taxes are collected at three levels: the federal government, 26 states plus the Federal District, and municipalities. Federal taxes are run by the federal revenue service (Receita Federal do Brasil).

Besides Law 15,270 of 26 November 2025, three more acts shape the 2026 rules. Complementary Law 224/2025 cut federal incentives by 10% and raised the tax on interest on net equity (JCP, Juros sobre Capital Próprio - a payment to shareholders that the company deducts from its profit) from 15% to 17.5%. Complementary Law 214/2025 launched the test of the new value added tax. Complementary Law 227/2026 required the states to adopt a progressive inheritance tax.

Rates for other countries in the region and beyond are in our taxes by country section.

Compare taxes in 146 countries: relocation taxes 2026

Who counts as a tax resident of Brazil

Brazil does not go by days alone: with a permanent visa, tax residency starts on the day of arrival, even after a single week in the country. The 183-day rule applies only to temporary visas without a Brazilian employment contract. A resident pays tax on income from anywhere in the world and must hold a Brazilian taxpayer number; a non-resident pays only on Brazilian income.

The rules are set out in the revenue service's Normative Instruction 208 of 2002 (Instrução Normativa SRF 208/2002) and repeated on the Receita Federal website.

Days are not counted by calendar year. The count starts on the date of first entry and runs for 12 months. If 184 days are not reached in that time, a new 12-month period starts from the next entry.

The weak spot in the rules: indefinite residence permits

The instruction was written for the old visa types. Migration Law 13,445/2017 replaced the permanent visa with an indefinite residence authorisation (autorização de residência por prazo indeterminado), while the text of the instruction stayed the same. Parents of a Brazilian-born child and other holders of indefinite residence should establish their residency start date in advance: it decides from which day Brazil claims tax on foreign income. How to obtain status is covered on our pages about giving birth in Brazil, residence through property and the digital nomad visa.

How to stop being a resident

Leaving is not enough. You have to file a notice of definitive departure (Comunicação de Saída Definitiva do País) by the end of February of the year after you leave, followed by a final departure return (Declaração de Saída Definitiva do País). Without the notice Brazil treats the leaver as a resident for another 12 months and expects tax on worldwide income. After exit, Brazilian income is taxed as a non-resident's: the payer withholds the tax.

When two countries both treat the same taxpayer as their resident, the double taxation agreement settles the dispute. How the 183-day rule works in different countries is explained in our article on tax residency and the 183-day rule.

Brazil tax residency: how to become a resident and count the days

Brazil does not count days alone. With an indefinite residence permit or a Brazilian employment contract, residency starts on the day of entry, even if you have lived there a week. The more-than-183-days-in-any-12-months rule applies to temporary visas.

A departing resident needs a final exit return, otherwise the status lasts another 12 months. A resident pays progressive income tax on worldwide income, a non-resident only on Brazilian income. The status is confirmed by the Brazilian Federal Revenue Service.

Mistakes cost more: without the exit return Brazil taxes foreign income for a year. Murblz support removes these risks: we count days and prepare the exit return or the certificate. We guarantee professional work and a transparent process, and in most cases a result on the first filing.

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What is the income tax in Brazil and how much of a salary is left

A salary of up to $1,100 (5,000 reais) a month has carried no income tax at all since 2026, while from $1,500 (7,350 reais) the relief disappears and the old scale with its 27.5% ceiling applies. That ceiling is lower than in Uruguay (36%) but almost three times higher than in Paraguay (10%).

Law 15,270/2025 left the scale itself untouched. It added a reduction to the tax already calculated: on income up to $1,100 (5,000 reais) the tax is reduced to zero, between $1,100 (5,000 reais) and $1,500 (7,350 reais) the reduction in reais is 978.62 - 0.133145 x income, and above $1,500 (7,350 reais) there is none. In the annual calculation the same thresholds are $13,000 (60,000 reais) and $18,000 (88,200 reais).

The taxable base is the salary minus the social security contribution and dependant allowances. A simplified deduction of $130 (607.20 reais) a month may be taken instead if it works out better. The tax is the base multiplied by the rate for its band, minus the deductible amount from the table.

Worked example: take-home pay

The calculation is for an employee with no dependants at 2026 rates. The social security contribution is capped, so its share falls as the salary rises.

The row for 6,000 reais step by step. Base: 6,000 - 641.51 = 5,358.49 reais. Tax on the scale: 5,358.49 x 27.5% - 908.73 = 564.85 reais. Reduction under the new law: 978.62 - 0.133145 x 6,000 = 179.75 reais. Tax due: 385.10 reais. Without Law 15,270 the same employee would hand over $40 (180 reais) more every month.

What reduces the tax in the annual return

• Dependants: $460 (2,275.08 reais) a year each, and each must have their own taxpayer number.
• Education: up to $720 (3,561.50 reais) a year for the taxpayer and for each dependant.
• Medical costs: doctors and hospitals with no upper limit, unless reimbursed by an insurer. Foreign health insurance premiums are not deductible.
• Contributions to Brazilian private pension plans: up to 12% of taxable income.
• The simplified option instead of all of the above: 20% of income, capped at $3,600 (17,640 reais) a year.

Deductions are what the revenue service queries most often: keep receipts and contracts for five years. Investment income and dividends are taxed separately - see below.

How much social security employees and employers pay

An employee on $2,100 (10,000 reais) a month costs a Brazilian employer roughly $2,800 (13,580 reais), before the thirteenth salary and holiday pay. The employee's own contribution never exceeds $200 (988.09 reais), whatever the salary: it is capped.

Social security is run by the National Social Security Institute (INSS). Contributions fund the state pension, sick pay and maternity benefit. The 2026 rates were set by Interministerial Ordinance 13/2026 (Portaria Interministerial MPS/MF 13/2026).

The scale is progressive: each rate applies only to its own slice of the salary. $330 (1,621 reais) is the 2026 minimum wage and $1,700 (8,475.55 reais) is the contribution ceiling. The employee pays nothing on earnings above the ceiling.

What the employer pays on top of the salary

• Social security - 20% of the full salary, with no ceiling. In the financial sector it is 22.5%.
• Work accident insurance (RAT, Riscos Ambientais do Trabalho) - 1% to 3% depending on how hazardous the activity is.
• Sector levies (known as third-party contributions: the training and social service funds SENAI, SESC, SESI) - usually about 5.8%.
• Severance fund (FGTS, Fundo de Garantia do Tempo de Serviço) - 8% paid into the employee's personal account. The money is released on dismissal without cause, when buying a home or on retirement.

Worked example for a $2,100 (10,000 reais) salary and a 2% accident insurance rate: 2,000 + 200 + 580 + 800 = 3,580 reais on top, or 35.8%. Add the thirteenth salary and the holiday bonus of one third of monthly pay, both mandatory under labour law.

Small businesses on the Simples Nacional simplified regime pay the employer contribution inside a single payment on revenue in most activities, instead of 20% of payroll.

The self-employed pay their own contributions: 20% of income up to the ceiling, 11% of the minimum wage under the simplified plan, or 5% for a micro-entrepreneur.

The public health system (SUS, Sistema Único de Saúde) does not depend on contributions: it is free for everyone in the country, foreigners included.

What are the corporate tax and dividend tax in Brazil

An ordinary Brazilian company pays a combined 34% on profit - more than in Chile (27%) or Uruguay (25%) and over three times Paraguay's 10%. Until 2026 one rule softened that rate: the owner received dividends tax-free. Now it holds only up to $11,000 (50,000 reais) a month.

The 34% has three parts. Corporate income tax (IRPJ, Imposto de Renda da Pessoa Jurídica) is 15%. A 10% surcharge applies to profit above $49,000 (240,000 reais) a year, that is $4,100 (20,000 reais) a month. And the social contribution on net profit (CSLL, Contribuição Social sobre o Lucro Líquido) is 9%. For insurers the contribution is 15% and for banks 20%, taking their combined rate to 40-45%.

Two ways to measure profit

Actual profit (lucro real). Tax is charged on accounting profit. The regime is mandatory for revenue above $16 million (78 million reais) a year and for financial institutions.

Presumed profit (lucro presumido). The state ignores expenses and assumes profit equals a fixed share of revenue: 8% in trade and manufacturing, 32% in services. For a service company the federal taxes come to 11.33% of revenue (IRPJ 4.8%, CSLL 2.88%, PIS 0.65%, COFINS 3%), with municipal service tax of 2-5% on top. That makes 13.33-16.33% of turnover, plus the 10% surcharge once presumed profit exceeds $13,000 (60,000 reais) a quarter. From 2026 Complementary Law 224/2025 raised the presumed-profit shares by 10% on revenue above $1.1 million (5 million reais) a year: 32% becomes 35.2%.

Dividends: what is taxed from 2026

• A resident receives more than $11,000 (50,000 reais) from one company in a month - the company withholds 10% of the whole amount, not just the excess. 49,000 reais means zero tax, 51,000 reais means 5,100 reais of tax.
• A non-resident receives dividends from Brazil - 10% on any amount, to any country.
• One Brazilian company pays another - no tax, as before.
• Profit earned up to the end of 2025 stays untaxed if the distribution was approved by 31 December 2025 and is paid on the approved schedule in 2026-2028. An interim ruling of the Federal Supreme Court (STF, Supremo Tribunal Federal) of 26 December 2025 extended the approval deadline to 31 January 2026 (cases ADI 7912 and 7914).

Minimum tax on income above $130,000 (600,000 reais) a year

The second mechanism in Law 15,270 is calculated once a year in the tax return. Almost all income is added up, tax-free dividends included, and the rate follows a formula: income divided by 60,000, minus 10. From $250,000 (1.2 million reais) the rate is 10%.

This is a floor, not a top-up. Income tax already paid for the year is deducted, including the 10% withheld on dividends. The base excludes capital gains made off-exchange, interest on savings accounts, income from exempt mortgage and agribusiness bonds, and assets received as an advance on a future inheritance.

There is also a ceiling. If the company itself paid the full 34% on its profit, Article 16-B reduces the owner's minimum tax: the combined burden on company and owner must not exceed 34%. Non-residents have a similar right to a credit under Article 10-A of Law 9,249/1995. So the new tax bites hardest where the company pays little on its profit: presumed profit and the simplified regime.

The revenue service holds that the 10% on dividends above $11,000 (50,000 reais) a month also applies to companies on the Simples Nacional simplified regime. In 2026 courts in several states sided with the companies; the higher courts have not settled the matter.

Company forms and the set-up procedure are described on our page about company registration in Brazil; other jurisdictions are in the company registration abroad section.

What is the VAT in Brazil and what the tax reform changes

Brazil still has no single value added tax: five taxes at three levels of government do its job, and since 2026 two new ones have been added for a seven-year transition. Until 2033 companies will run the old and new systems in parallel.

There is no registration threshold of the kind familiar from Europe. A company registers with the state and the municipality from its first sale, while small businesses pay these taxes inside the single payment of the simplified regime. Exported services are exempt from ISS, PIS and COFINS when the result of the service is obtained abroad and payment comes into Brazil from overseas.

The dual value added tax: what is coming and when

Constitutional Amendment 132/2023 and Complementary Law 214/2025 replace the five taxes with two. CBS (Contribuição sobre Bens e Serviços), a federal contribution on goods and services, takes the place of PIS and COFINS. IBS (Imposto sobre Bens e Serviços), a tax shared by states and municipalities, replaces ICMS and ISS. Both work as a classic value added tax with full input credit, charged where consumption takes place.

The final rates will be set later. Law 214/2025 names 26.5% combined as the benchmark, and official estimates point to about 28% - on a par with the highest value added tax rates in the world. For comparison, Uruguay charges 22% and Chile 19%.

The reform keeps the Simples Nacional simplified regime, and with revenue below $8,200 (40,500 reais) a year there is no CBS or IBS to pay.

What sole traders and small businesses pay in Brazil: MEI, Simples Nacional and remote work

The cheapest legal status in Brazil costs from $20 (82.05 reais) a month: the fixed payment of a micro-entrepreneur, which already includes taxes and the pension contribution. But a developer, engineer or marketer cannot use it - for them there is the simplified regime, with rates from 6% of revenue.

Micro-entrepreneur (MEI, Microempreendedor Individual)

• Revenue of no more than $17,000 (81,000 reais) a year; the limit has not changed since 2018.
• Monthly payment: 5% of the minimum wage to social security, $20 (81.05 reais), plus $0.21 (1 real) of state tax for trade or $5 (5 reais) of municipal tax for services.
• No more than one employee.
• No shareholding in, or management of, another company.
• Only occupations from a closed list: hairdresser, driver, small-scale retail, repairs. Intellectual professions are not on it.

A foreigner needs a taxpayer number and the resident foreigner's ID card (CRNM, Carteira de Registro Nacional Migratório) to register. Non-residents are not eligible.

The Simples Nacional simplified regime

The regime for companies and sole traders with revenue up to $970,000 (4.8 million reais) a year was created by Complementary Law 123/2006. One monthly payment replaces corporate income tax, the social contribution on profit, PIS, COFINS, the state or municipal tax and the employer's social security contribution. The rate depends on the activity and rises with turnover.

The lowest rate applies to revenue up to $37,000 (180,000 reais) over 12 months. A service business in Annex V moves to Annex III if payroll, including the owner's salary, is at least 28% of revenue. The difference at the start is 6% against 15.5%.

The regime is closed to companies with another legal entity as a shareholder or with an owner who lives abroad. First the move and residency, then Simples.

Worked example: $3,100 (15,000 reais) a month from foreign clients

A resident developer earns 15,000 reais a month, or 180,000 a year. As an individual the tax follows the scale: 15,000 x 27.5% - 908.73 = 3,216 reais a month, about $650, 21.4% of income, before deductions. Through a company on Simples under Annex III it is 6% of revenue, 900 reais, about $190. To qualify for that annex the owner pays themselves a salary of at least $850 (4,200 reais), 28% of revenue; 11% of it goes to social security, and income tax on that amount is zero in 2026. The rest comes out as tax-free dividends as long as the payout stays within $11,000 (50,000 reais) a month.

Remote work, digital nomads and professionals from abroad

Brazil has no special regime for newcomers. There is neither a tax holiday on foreign income, as in Uruguay, nor a reduced rate for relocating professionals, as in Portugal. The digital nomad visa gives the right to live in the country, not a tax break: for the first 183 days Brazil does not tax foreign income, and from day 184 all worldwide income falls under the scale of up to 27.5%.

A resident paid from abroad, or paid by individuals, calculates the tax every month. This calculation is called carnê-leão: income is entered in the revenue service's online account and taxed on the general scale. Foreign tax on the same income is credited if there is an agreement or reciprocity with that country.

A company bank account can be arranged through our business account in Brazil service.

Taxes on property, cars, inheritance, investments and crypto

Buying a flat in São Paulo costs 3% in transfer tax; selling it at a profit costs at least 15% of the gain. In between, the owner pays the municipality about 1% of the assessed value every year. Brazil has no wealth tax: the constitution allows one, but the law was never passed.

Property: selling and renting out

A resident pays no tax on the gain in two cases. First: the only home was sold for no more than $89,000 (440,000 reais) and there were no other sales in the past five years. Second: the proceeds from selling a home were put into another home in Brazil within 180 days, once every five years. The revenue service denies these reliefs to non-residents (Normative Instruction 208/2002), although in individual cases courts have sided with sellers.

A resident's rental income is taxed on the general scale up to 27.5%, a non-resident's at a flat 15%. The reform will add value added tax: an owner of more than three rented properties with rental revenue above $49,000 (240,000 reais) a year becomes a CBS and IBS taxpayer, with the rate for rentals reduced by 70%. Properties for purchase are selected through our investment property in Brazil service.

Inheritance and cars

The 8% ceiling on inheritance tax was set by the Senate back in 1992. Complementary Law 227/2026 required every state to adopt a progressive scale and allowed foreign assets to be taxed when the deceased or the heir lives in Brazil - once the state passes its own law. Constitutional Amendment 137/2025 exempted cars 20 or more years old from vehicle tax.

A resident's foreign assets

Law 14,754/2023 ended the deferral that owners of foreign companies relied on. Interest, dividends and gains on foreign accounts are taxed at 15% once a year. The profit of a controlled company in a low-tax jurisdiction, or one with passive income, is treated as the owner's income on 31 December even if it was not distributed. More on our controlled foreign companies page.

Crypto

A flat 17.5% rate was not introduced: presidential Provisional Measure 1,303/2025 (Medida Provisória - an act with the force of law that Congress must approve within 120 days) lapsed on 8 October 2025 without a vote. Sales on Brazilian platforms of up to $7,100 (35,000 reais) a month are tax-free; above that, the gain is taxed on the 15-22.5% scale. Crypto held or sold through foreign platforms is treated by the revenue service as a foreign financial asset: 15% once a year and no monthly exemption. Since July 2026 the new monthly DeCripto report (Normative Instruction 2,291/2025) has applied: residents themselves report trades made through foreign exchanges.

What non-residents pay and Brazil's double taxation agreements

A non-resident pays between 10% and 25% at source in Brazil, and the tax is almost always final: there is no return to file, but no deductions either. The highest rate - 25% - is on salaries and services, so working for a Brazilian client from abroad costs more than it looks when the contract is signed.

Brazil treats a jurisdiction as low-tax if its income tax rate is below 17% or information on company ownership is closed. The list is kept by the revenue service.

Which countries have agreements with Brazil

The Brazilian revenue service lists 38 agreements in force in 2026. They include Ukraine (Decree 5,799/2006), Portugal, Spain, France, Italy, the Netherlands, Israel, Turkey, the United Arab Emirates, China, India, Argentina, Uruguay and Chile. The newest is with Poland, enacted by Decree 12,865/2026.

Brazil's domestic rate on dividends is 10% anyway, so an agreement's main value lies elsewhere: it decides which country treats a taxpayer as its resident in a dispute and obliges each side to credit tax paid in the other.

• There is no agreement with the United States.
• The agreement with Germany has not applied since 1 January 2006.
• Agreements with the United Kingdom and Colombia have been signed but are not in force.
• There are no agreements with Kazakhstan or Belarus.

Without an agreement, foreign tax can be credited only where there is reciprocity: the revenue service recognises it with the United States, the United Kingdom and Germany. In other cases the same income may be taxed twice, and the income structure has to be set up before the move. Murblz specialists run these calculations.

The agreement with Russia, signed in Brasília on 22 November 2004 and applied since 2018, operates in full in 2026: Russia's 2023 suspension of tax agreements does not cover Brazil. It caps dividends at 10% for a company holding at least 20% and at 15% otherwise, and interest and royalties at 15%; see also taxes in Russia.

When to file a tax return in Brazil and the penalties for being late

The annual return in Brazil is due by the last business day of May, and there are no extensions. Being one day late costs at least $35 (165.74 reais) and at most 20% of the year's tax. In 2026 the revenue service accepted returns for 2025 from 23 March to 29 May.

The employer withholds tax on salary every month and the return settles the balance: any amount due can be paid at once or spread over up to eight months with interest, and any overpayment is refunded to a bank account.

The return lists not only income but assets worldwide: accounts, property, shareholdings, cars, crypto. There is no tax on assets, but growth in net worth is checked against declared income. Mismatches with data from employers, banks and clinics are caught by an automated cross-check that Brazilians call the fine mesh (malha fina).

Fines and interest

• Late return: 1% of the tax for each month of delay, no less than $35 (165.74 reais) and no more than 20% of the tax.
• Late payment: a penalty of 0.33% per day, capped at 20%, plus interest at the Central Bank's policy rate (Selic).
• Assessment after an audit: a fine of 75% of the unpaid tax (Article 44 of Law 9,430/1996).
• Limitation period: the revenue service may review a return for five years.

The return for 2026 is filed in 2027, and it will be the first to include the minimum tax on high incomes. The revenue service updates the filing thresholds every year in a separate instruction.

What Brazil's taxes mean for people moving there: who gains and who does not

For anyone moving with income from abroad, Brazil is one of the most expensive countries in the region: up to 27.5% on all worldwide income from the first day of residency, with no transition period and no reliefs for new residents. Neighbouring Paraguay has a 10% income tax rate, and Uruguay gives new residents a tax holiday on foreign investment income.

The second uncomfortable truth is complexity. In the World Bank's last Doing Business ranking (2020), a medium-sized Brazilian company spent 1,501 hours a year preparing and paying taxes - the worst result among 190 economies. The reform is meant to fix that, but until 2033 the books have to be kept under two systems at once.

Who benefits from Brazilian taxes

• Employees earning up to $1,100 (5,000 reais). No income tax; only the social security contribution is withheld, about 10%.
• Small service businesses. The simplified regime from 6% of revenue and tax-free dividends up to $11,000 (50,000 reais) a month.
• Anyone spending fewer than 184 days in 12 months in the country on a temporary visa. Brazil does not tax foreign income until residency starts.

Who should think twice

• Remote professionals and people living on investment income with high foreign earnings. The whole amount falls under the scale of up to 27.5%, and tax has to be calculated and paid every month.
• Owners of foreign companies. Law 14,754/2023 taxes a controlled company's profit at 15% every year, even if it is not distributed.
• Recipients of dividends from $250,000 (1.2 million reais) a year. A 10% minimum tax on all income, unless the company paid the full 34% on its profit.
• Anyone who often sends money abroad or spends on a Brazilian card when travelling. 3.5% on every transaction.

What to do before the move

1. Establish the date tax residency will start: it depends on the visa type, not only on the number of days.
2. Recalculate foreign income on the Brazilian scale and check whether there is an agreement or reciprocity with the source country.
3. Decide what to do with a foreign company and investment accounts before arrival, not after the first tax return.
4. Get a taxpayer number and open an account - our personal account in Brazil service handles this.
5. Close tax residency in the previous country, otherwise two states will claim the same income.

The country's migration programmes are collected on our Brazil: citizenship, residence and visas page. For comparison, see taxes in Argentina and taxes in Paraguay.

How to get from residence to a passport, and why citizenship by itself does not change taxes, is explained on the page Brazilian citizenship.

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