Brazilian tax residency: what you need to know

In 2026, the theme tax residence in Brazil has gained strategic importance for entrepreneurs, investors and Brazilians living abroad. With more and more Brazilians living abroad, the international movement of capital and improvements in the cross-checking of tax data, understanding tax residency is no longer just a formality, but has a direct impact on the country. where and how much tax you pay. This article explains the subject in a simple and practical way, with examples and guidance to avoid common mistakes.

What is Tax Residency in Brazil?

Concept in legislation

Tax residency determines where a person is considered a taxpayer for tax purposes. In Brazil, the Internal Revenue Service uses this concept to decide whether you pay tax on your global income or just on the income generated in the country.

Civil residence vs. tax residence

Civilian residence is where you live on a day-to-day basis, in the ordinary sense.
Tax residency is a tax category: even if you live abroad, you can still be considered a tax resident in Brazil if certain conditions are not met.

The 183-day criterion and the center of economic interests

The best-known rule is the 183 days in a 12-month period, consecutive or not. If you stay in Brazil for more than 183 days in 12 months, you can be considered a tax resident, even without a permanent visa, in certain situations.

In addition, the IRS considers links such as employment, permanent residence and center of economic interests (where your main businesses or family are) to assess tax residency.

Tax resident or non-resident: understand the rules

If you are a tax resident in Brazil

If you are considered a tax resident, you must:

• Declare and pay tax on their worldwide income in Brazil.

• Include all income, including foreign income, in the annual declaration.

• Declare global assets and rights as required (Income Tax).

If you are not a tax resident in Brazil

If you become a non-tax resident, you will only be subject to tax on income from Brazilian sourcesuch as:

• Income from renting property in Brazil.

• Dividends, interest or profits of Brazilian investments.

• Capital gains from assets in the country.
  Foreign income is not taxed in Brazil once you leave the country.

What you can't do without formalizing your permanent departure

Even if you've lived abroad for a long time, if you don't formalize the final exit, you can:

• Continue to be taxed in Brazil on income from abroad.

• You will need to submit your annual tax return as a resident.

• Being subject to retroactive tax requirements.

Read also: Can foreigners work in Brazil? Find out how to hire them step by step

Can people who live abroad have tax residency in Brazil?

Person who left and did not leave permanently

If you left Brazil and has not formally communicated his departure, In this case, the tax resident status is maintained for up to 12 months after departure, even if they live abroad.

Person who has left permanently

When communicating and delivering the Declaration of Final Departure from the Country (DSDP), This means that you are no longer a tax resident in Brazil and will only be taxed on income from Brazilian sources.

What you can't do without formalizing your permanent departure

Even if you've lived abroad for a long time, if you don't formalize the final exit, you can:

• Continue to be taxed in Brazil on income from abroad.

• You will need to submit your annual tax return as a resident.

• Being subject to retroactive tax requirements.

Can people who live abroad have tax residency in Brazil?

Person who left and did not leave permanently

If you left Brazil and has not formally communicated his departure, In this case, the tax resident status is maintained for up to 12 months after departure, even if they live abroad.

Person who has left permanently

When communicating and delivering the Declaration of Final Departure from the Country (DSDP), This means that you are no longer a tax resident in Brazil and will only be taxed on income from Brazilian sources.

Person who maintains a company or investments in Brazil

Even if you are not a tax resident, you can keep companies or investments in Brazil. However, the taxation of these assets will be specific to non-residents and may include withholding tax.

Cases of dual tax residence

When two countries consider you a tax resident, the following can occur taxation on both. To avoid this, there are International Double Taxation Treaties, These rules determine which country a person should pay tax in first.

Has anything changed in the law in 2026?

So far, no structural change in Brazil's tax residency rules in 2026. The standards are still based on Income Tax Regulation (RIR) and Normative Instructions of the Federal Revenue Service.
What has changed is intensified monitoring and cross-checking of international data, This makes it more likely that inconsistencies will be detected.

What are the main laws in force?

Income Tax Regulations (RIR): Defines general tax residency criteria and taxation rules for residents.

Normative Instructions from the Federal Revenue Service on definitive exit: They regulate the formalization of the exit and the related accessory obligations.

Rules for communicating permanent departure from the country: Initial document announcing the possibility of no longer residing in Brazil.

Declaration of Final Departure from the Country (DSDP): It replaces the annual income tax return for the year in which you ceased to be a tax resident.

International Anti-Taxation Treaties: Instruments to prevent the same income from being taxed in more than one country.

Taxpayers' main questions in 2026 

Can I live abroad and still declare in Brazil?
Yes, but if you are considered a tax resident and do not regularize your departure, you still need to declare your income in Brazil.

Do I have to pay tax in Brazil if I already pay it abroad?
If you are still a tax resident in Brazil, yes - your worldwide income is taxed. Otherwise, Brazilian tax is only levied on income from Brazilian sources.

Can I have a company in Brazil while living abroad?
Yes. As a non-tax resident you can keep companies, but taxation follows specific rules for non-residents.

What happens if I don't communicate my departure?
You continue to be treated as a tax resident and subject to Brazilian tax obligations for up to 12 months or more.

Can I become a tax resident again afterwards?
Yes. If you return to Brazil with permanent intent or stay for the 183-day period, you can once again be considered a tax resident.

Do I need to declare assets abroad?
Yes, if you are still a tax resident in Brazil. If not, only assets in Brazil are relevant for the local declaration.

Maintaining income in Brazil without regularizing your situation can lead to:

• Retroactive tax collection with interest.

• Fines for late or missing declarations.

• Consequences for international remittances and banking restrictions.

• Risk of double taxation if there is no efficient treatment.

Strategic conclusion

Tax residence is a strategic tax decision, It's not just a bureaucratic issue. Choosing correctly where you are considered a tax resident directly impacts your tax burden, investment planning and compliance with international laws.

For entrepreneurs, investors and Brazilians living abroad, having experts who understand international tax planning, tax compliance and corporate structuring is essential to avoid unnecessary risks and optimize your tax structure.

CLM Controller has expertise in these areas and can guide you through every step of this process, ensuring security, compliance and tax efficiency.