Tax in Brazil
When buying a property in Brazil it is essential that you understand how the tax system works and know exactly what you will be liable for. The team at My Other House are able to offer guidance and advice on tax issues however it is recommended that you consult an independent tax advisor to discuss the tax implications of your individual situation.
Below is a guide to help you understand tax in Brazil.
UK-Brazil Tax Treaty
This double tax treaty ensures investors do not pay Capital Gains Tax in both countries.
Capital Gains Tax
A tax is levied on any capital gains made on the property and land. Capital Gains Tax is based on the sale price minus the purchase price. This is charged at 15% on gains from properties in Brazil, unless you re-invest the profits in another Brazilian property, in which case you are exempt.
Stamp Duty
This is 3% of the purchase price.
Inheritance Tax
Inheritance and wealth taxes at federal level do not exist in Brazil. However, some states may impose death transfer or donation/gift taxes on the occurrence of appropriate events.
Property Tax
Property tax is payable on the total annual rental income, not the value of the property. The table below shows the sliding scale of how the tax is worked out.
| Rental Value in Real | Tax rate |
| Less than R$1250 | Exempt |
| R$1250 to R$2500 | 15% |
| More than R$2500 | 27.5% |