2023-10-15 11:58:48
Brazilian Depositary Receipts, known as BDRs, are securities issued by financial institutions in Brazil that allow Brazilian investors to invest in foreign assets. But how does taxation work for BDRs? In this article, we will explore in detail the rules and tax implications of this type of investment so that you can make more informed financial decisions.
Taxation on the Sale of BDRs
When an investor sells a BDR, he is subject to capital gain taxation. The capital gain is the difference between the sale price and the purchase price of the BDR. The income tax rate on capital gains is 15%. In Day Trade operations, the rate is 20% on gains, with 1% of the positive amount withheld at source.
For example, if an investor bought a BDR for R$100 and sold it for R$150, he obtained a capital gain of R$50. Taxation on this gain will be R$7.50 (15% of R$50). It is important to highlight that there is no exemption for sales of up to R$20,000 in BDRs, as is the case with other types of assets.
To collect the tax, it is necessary to issue a DARF (Federal Revenue Collection Document) with code 6015 by the last business day of the month following the sales made. The DARF must be paid through the Federal Revenue Sicalc program.
Income Taxation on BDRs
Unlike Real Estate Funds, which are exempt from dividends, BDRs are subject to dividend taxation. The rate varies from 7.5% to 27.5%, depending on the amount of income. Currently, taxation only applies to monthly income that exceeds R$1,903.98, the exemption limit. If the value is lower, there will be no tax to be collected.
If you receive an amount greater than this limit, you must issue a DARF to make payment by the last day of the month following receipt of the amounts. The correct code for the income DARF is 0190.
It is important to highlight that dividends from BDRs may also be subject to taxation in the country of origin of the shares. The amount that the Brazilian investor receives in his account is already net of the discount on rates charged abroad. Therefore, there is no need to worry regarding paying taxes to another country. However, it is essential to check the rates charged in the country of origin of the BDRs, as they may vary according to each legislation.
Non-Double Taxation of BDRs and Reciprocity Agreements
In some cases, it is possible to take advantage of the non-double taxation of BDRs when there is a reciprocity agreement between Brazil and the country of origin of the company issuing the BDRs. This means that Brazilian investors who invest in BDRs from companies in these countries do not need to pay taxes on income abroad.
However, it is important to consult the list of countries with which Brazil has double taxation agreements to check whether this exemption applies. These agreements are established to avoid double taxation and ensure that investors are not penalized for paying taxes in both countries.
Income Tax Declaration
The procedure for declaring BDRs is similar to that for other Variable Income assets traded on the Stock Exchange. The investor is subject to taxation at two stages: when selling the asset and when receiving income.
When selling the asset, the rate for common operations (Swing Trade) is 15% of the profit, with 0.005% of the sale value withheld at source. For Day Trade operations, the rate is 20% on profit, with 1% of the positive amount withheld at source. Tax collection must occur through DARF, which must be issued with code 6015 by the last business day of the month consecutive to the sales operations carried out. It is important to note that there is no exemption for sales of up to R$20,000 per month.
In the case of receiving income, dividends received in BDRs are taxed. The rate varies from 7.5% to 27.5%, depending on the amount of income. Tax must be collected monthly whenever income exceeds R$1,903.98. If the income has already been taxed abroad, it is possible to offset the tax paid on dividends directly in the country of origin of the company issuing the shares that serve as collateral for the BDRs. To do this, there must be a double taxation agreement or an exchange of treatment between the company’s country of origin and Brazil.
Fees and Custodian
In addition to taxation on gains and income, it is important to be aware that there is a tax that varies from 3% to 5% on the payment of dividends and/or other cash distributions announced by the company that are retained in the custodian, the financial company that generated the BDRs. This fee is already deducted at source, so the investor does not need to worry regarding paying it.
Loss Compensation
In relation to losses, it is possible to offset previous losses through gains from other operations, such as spot, forward, options and futures, as well as deducting expenses. This offsetting of losses can be carried out within the same type of operation (cash with cash, for example) or between different types of operations.
It is important to remember that income tax declaration is mandatory for investors who own BDRs, regardless of the amount invested. It is recommended to consult a specialized accountant or use income tax declaration platforms to ensure that all information is filled out correctly.
Conclusion
The taxation of BDRs is an important aspect to be considered by investors interested in this type of asset. It is essential to understand the applicable rules and rates, both when selling BDRs and when receiving income, to avoid problems with the tax authorities and properly manage your investments.
Please remember that the information provided in this article is for informational purposes only and does not constitute financial advice. Always consult a qualified professional before making any investment decision or carrying out financial transactions.
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