Sending over $10k to Brazil: Tax laws to know | finder.com
transferring large sums of money into Brazil

Tax guidelines and regulations for large money transfers into Brazil

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Here’s what to know about taxes when transferring money into Terra do Brasil.

Supporting your student studying in São Paulo or starting a business in Brasilia — you could have many reasons for sending a large money transfer to Brazil. One element you’ll want to consider are that country’s laws and legal paperwork. Before you move your money out of the US, familiarize yourself with these laws and regulations.

How Brazil regulates large remittances

Americans sent $637 million from the US to Brazil in 2015 through banks and money transfer services. But when sending a lot of money, your recipient could be on the hook for taxes regulated by the Brazilian Department of Federal Revenue.

Gift and donation taxation rates vary among the 26 states of Brazil, ranging from 4% in Rio de Janiero to up to 7% in Santa Catarina. Beneficiaries of these gifts are responsible for declaring and paying this tax with their annual returns by April 30.

What are the penalties for not filing a large remittance?

Brazilians are among the biggest tax evaders worldwide, largely due to an absence of penalties until recently. If you fail to file taxes on a large money transfer today, you could face a penalty equal to 20% of the tax in question. If you’re caught in one of the country’s irregular sweeps for unpaid taxes, that penalty increases to a stiff 75% of the amount you owe.

You could also be hit with jail time of six months to two years, with increased fines for subsequent evading.

Encourage your family and loved ones to include any large remittance on their annual tax return or speak to a tax professional for guidance.

Do I have to report large transfers out of the US?

To be safe, yes. To avoid severe penalties that could come with a failure to report large sums of money into and out of your own country, speak with a professional to guarantee that everything is above board.

By law, banks are required to report cash transactions that exceed $10,000 and transactions of any amount they find suspicious. For independent money transfer businesses, that thresholds can be as low as $1,000.
Sending a lot of money out of the country? Know what the IRS expects of you.

How will president trump’s proposal to tax remittances to Brazil affect my transfer?

Politics may put a wrinkle in money transfers sent to friends and family in Brazil.

In 2017, Congress submitted a bill proposing a 2% tax on remittances to Latin American countries that include Mexico, Brazil, Honduras and El Salvador — a tax that’s a significant key to fulfilling the Trump administration’s campaign promise to build a border wall between the US and Mexico. We’ll keep an ear to the ground as the situation develops.

How will my recipient receive my remittance in Brazil?

When sending money to your friends and family in Brazil, you’ll typically have the option of a bank-to-bank transfer, cash pickup or mobile wallet delivery.

To pick up your transfer in person, they may need to show ID or a confirmation number. For other transfers — like to a Brazilian bank or money transfer company — they may not need to provide anything to receive it.

As with all international money transfers, be wary of potential fraud and only send money to people you know. Using a reputable provider can safeguard you from potential scams.

How to set up a business entity in Brazil

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    2 Responses

    1. Default Gravatar
      SoGOctober 22, 2018

      Is there any way to transfer USD to a Brazil nonprofit? Everything I read seems to be individual to individual. How about from a US nonprofit to a Brazil nonprofit?

      • finder Customer Care
        AnndyNovember 5, 2018Staff

        Hi SoG,

        Thanks for your question.

        If you want to send USD to an organization or business in Brazil, you may check this page to compare your money transfer options. You can enter the amount that you want to send on the calculator on top of the comparison table to see how much your recipient will possibly receive using a particular service.

        I hope this helps.

        Cheers,
        Anndy

    US International Money Transfers Offers

    Important Information*
    XE Money Transfer

    Transfer up to $500,000 with no minimums and no fees.

    WorldRemit International Money Transfers

    Use promo code FINDER to send your first transfer with no fee.
    Send to 110+ countries for bank-to-bank deposit, cash pickup or mobile top-up.

    World First

    No maximum limit, no fees and competitive exchange rates for 100+ currencies.

    TransferWise

    Enjoy high maximum transfers into more than 20 currencies while saving up to 90% over local banks.

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