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@Cheryl

Hi Cheryl,

I am in a complicated situation and I can use some advice.

Me and my fiancé met 10 years ago in South America. She is a Brazilian citizen and I live in Western Europe.

I have lived in Brazil for 2 years, and we decided to come to Europe together. She studied our language, got a college degree here and now has a consistent job for 2 the last 2 years. She pays her income taxes here.

We have been in a legal battle with our national migration service for 2 years. They are trying to prevent as many immigrants as possible from obtaining permanent residency here, but we won the case and she now has the right to stay here permanently.

However..

She owns a property in São Paulo. It is in her name, and her mother still lives there. In the long run, we are in doubt if we want to live here or there. She has never officially left Brazil (Declaração De Saída Definitiva Do País). I think that she is still paying property taxes in Brazil. But not income taxes, because she pays them in Europe. Her European bank account and her salary here are not registered with the authorities in Brazil. We want to avoid double taxation, obviously.

Until 2 years ago, she received monthly allowances from the Brazilian government because her father passed away as a police officer. An old law says that children of such police officers keep receiving this allowance, until they are married or have children. To keep receiving this allowance, she has to declare that she is not married or has children every single year in Brazil.

But because we were in this legal battle in Europe, she was not allowed to leave our country until we won the case about her citizenship. So she could no longer make that declaration.

She has not received the allowance for 2 years and we have heard that it is in a blocked account. She can get it back soon (we are coming to Brazil in 2 weeks) depending on her declaration when we go there.

She is not married at this point, but we are getting married in september. I don't know what we have to declare.

I also do not know if it is wise for her to give up her tax residency in Brazil. Because taxes in my country are much higher.

I am a medical doctor in Europe and since 2 years ago I have successfully invested in crypto currencies.

However taxes on those profits are huge in my country. Therefore I consider donating the crypto assets to my wife, and she can cash them out under Brazilian tax laws which are much more favorable. But I don't know in which country she is supposed to pay those taxes at this point.

Can she be a tax resident in 2 countries and choose by herself?

I think that not declaring foreign bank accounts (The European bank account not registered in Brazil, and the Brazilian account not registered here) is a dangerous game that will backfire in the future. But she absolutely doesn't want to take my advice and declare them. Especially if we marry in Europe in september and she still keeps receiving allowances in Brazil, I am pretty sure she will have to pay everything back in the future with giant penalties on top.

I don't know if the Brazilian tax authorities can also demand tax on her income salary from Europe, that was not declared in Brazil. She has already paid those taxes here, but officially she is a tax resident in both countries now.

06/01/25 @Woot.  Good morning.  I've reviewed your prior posts, and am happy for you two that your fiancée's immigration case is finally resolved.  Congratulations.

Before you get married, your fiancée should find a Brazilian lawyer that you two feel comfortable with -- in person would be ideal, but remotely through referrals from friends and family may be enough for now, to help her resolve, in order of urgency,

1. her tax status in Brazil -- she probably should have been filing declarations every year since she's still a tax resident, but that doesn't necessarily mean that she owes anything.  Brazil has strong policies against double taxation and as you say, EU taxes are higher;
2. her status with respect to her survivor's pension.  She's probably due the back payments, and if so, a lawyer can probably help her to update her paperwork and get them.
3. her future status with respect to the pension:  that should be resolved prior to your marriage.  It sounds like she's not in violation of the terms yet, so she doesn't want to be by leaving this undone.

As for the crypto question, consider discussing that with the attorney only when and if you've built up a level of trust with him or her that makes you comfortable.  Good luck.

Can you give me an idea of what a Brazilian tax lawyer costs? I have been looking for prices but they usually don't mention that on the website. I'm not sure if he has to be from her city. Maybe it can be done with video calls online. I don't like it when hourly rates are not mentioned on the website because it allows lawyers to set higher prices for foreigners.

My wife is worried about the payments (survivors pension) that she missed out on. She wants to make sure that she gets those back first. However, if she declares that she is no longer a resident in Brazil and hasn't been a resident for the last 2 years, maybe that would be an argument to keep the payments from her. I think that this is why she wants to wait with that declaration.

You could make a case that someone who isn't a resident anymore, is no longer entitled to a survivor pension.

This article here

And this one

strongly indicates that my wife has to declare that she is no longer a resident in Brazil. She can prove that too. She has been working consistently here and she has an address here.

I do wonder if Brazilian authorities will ask details of her bank account here, even if she is no longer a resident in Brazil.

06/01/25 @Wout.  The "honorário" suggested by the OAB -- Ordem de Advogados do  Brasil -- for an initial consultation with an attorney is one Salário Mínimo, currently R$1518.  After that, fees are negotiable based on the scope of the work proposed.  The fee for the initial consultation is also negotiable, and some attorneys, especially new ones, may even waive the fee for the initial consultation.  Naturally, you want to ask about charges first thing.

Whether your fiancée is still eligible for the pension or not depends on the terms of the pension, which an attorney should be able to determine easily, while advising her on the timing of changing her tax residence, and how to address the declarations that she hasn't filed with the Receita Federal.  I would doubt that merely moving abroad without changing her tax residence would void the pension and that changing her tax residence might, but that's just a guess. 

As to whether the Brazilian authorities would ask for details of her bank account there, the lawyer will undoubtedly tell you about that as part of the discussion of her tax status, and how to field the questions.  If either or both of you transfer significant funds to Brazilian accounts from foreign accounts, the Banco Central do Brasil will require significant documentation of your legitimate ownership of the funds.  This is not for tax purposes, but as part of their auditing to detect money laundering and profits from illegal activities.

@Wout

I think @abthree has given you some very sensible advice, but you really do need to find a suitable tax attorney in Brazil, and maybe even more than one. In my experience, most will grant you an initial interview for free, then you can choose which one to go with.

The problem is that tax matters in Brazil are very subjective, advice can vary enormously, and most attorneys will not have a great deal of experience in this field. This is because they have to pay for training in specific modules that are not part of the basic course, and dealing with international questions such as yours is definitely not part of the basic course! But I can guarantee that it will cost you a lot more than 1 salary in the long term to resolve...

Look at other threads on this forum, and you will see how advice on tax matters in Brazil for foreigners varies enormously. For example, some posters advocate that a foreigner moving here should pay little or no tax on their overseas income, others have actually refused to move to Brazil beacuse this will be so high... How can both be correct?

By way of illustration, I was talking to a Brazilian attorney 12 months ago about a real estate problem he had (strangely, I knew more than he did). He spoke excellent english, and told me that he worked for a sizeable law firm in Recife.

So I asked which aspects of law his firm dealt with, and he told me all of them. Then I asked if his firm might be interested to advise foreigners about tax and immigration, and he responded that those were 2 specialities that they did not work with...