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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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I (husband) have sent a wire transfer of "donation monies"

Resolved Question:

I (husband) have sent a wire transfer of "donation monies" from my Wells Fargo bank account in the amount of $107,500 in U.S. currency to my wife into her bank account in Brasil.
Should arrive in next couple of days. Would I or my wife be subject to a tax from Brasilian Fed or this bank even though it is a gift?
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

Lev :

Hi and welcome to our site!
The only tax levied in Brazil on gifts is the ITCMD (Imposto sobre Transmissão Causa Mortis e Doação de Quaisquer Bens ou Direitos) tax. ITCMD is a state tax imposed on the transfer of ownership of goods and rights upon gift. ITCMD rates vary according to the local laws of the State (up to 8%). For instance, in the State of São Paulo - the rate is 4%. ITCMD is usually paid by the recipient of the gift.


This rate applies to amounts above certain level. São Paulo for instance allows up to BRL48,000 donations during 12-month period without ITCMD.

Lev :

Just recently - in the case of the gift from a donator resident abroad, the Court of Appeals in São Paulo (TJ-SP) confirmed the opinion that charging such tax is illegal.
See more details in this article -
http://www.lexology.com/library/detail.aspx?g=2afc71fe-908b-444c-b427-6889d213b9eb
Still we do not know official response from taxing authorities.

Customer:

So, since our marriage is registered in Brasil and US and these donation monies wired are most likely non-taxable by Brasilian Government...does the amount have a determining factor $107,500 (U.S.= R$235,640 ?

Lev :

Because that is Brazilian tax - the amount is determined in Brazilian curency.
ITCMD is NOT imposed by Brazilian Government - this is tax on the state level and regulated by state laws.
As long as you are married - it doesn't matter if the marriage is registered in Brazil or in the US or both.

Customer:

Do you know the state of Santa Catarina Law relative to amount of around R$235,640 as donation monies wired into Brasilian account?

Customer:

Do you know the ITCMD law imposed on donation wire transfers into the State of Santa Catarina, BR...bank account?

Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22831
Experience: Taxes, Immigration, Labor Relations
Lev and 3 other Tax Specialists are ready to help you
Expert:  Lev replied 1 year ago.
ITCMD is a state tax imposed on the transfer of ownership - regardless if the transfer completed via wire transfer to the bank account or any other way.
But a recent the Court of Appeals decision which confirmed that charging ITCMD tax is illegal when the gift from a donator residing abroad will change the situation - but all aspects are not clear.
Specifically for the state of Santa Catarina - see HERE

Up to R $ 20,000
- de R$ 20.000,01 a R$ 50.000 - R $ 20,000.01 to R $ 50,000
- de R$ 50.000,01 a R$ 150.000 - R $ 50,000.01 to $ 150,000
- Acima de R$ 150.000 - Over $ 150,000
Parente colateral e não parente Collateral and not relative

1% 1%
3% 3%
5% 5%
7% 7%
8% 8%

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