Brazil 2026: How Taxation Works in Brazil

Brazil 2026: Why the Country Remains Attractive for Remote Workers

In recent years, Brazil has increasingly attracted professionals who work remotely, whether residing in the country or arriving from abroad.

With the regulation of the digital nomad visa, the consolidation of remote work, and the new Income Tax rules effective in 2026, understanding how taxation applies to those who live and work in Brazil is essential — regardless of employment status or the location of the contracting company.

1. Tax Residency in Brazil

Tax residency is the determining factor for defining whether a person is subject to taxation in Brazil.

According to Normative Instruction RFB No. 208/2002, an individual is considered a tax resident if, as a rule:

• they remain in the country for more than 183 days, consecutive or not, within a 12-month period.

This means that any remote worker who maintains regular ties with Brazil — even when working for a foreign company — may be considered a tax resident and therefore subject to Brazilian taxation.

2. Personal Income Tax (IRPF) in 2026

With the enactment of Bill 1087/2025, Brazil’s income taxation system underwent one of the most significant revisions of the last decade.

The new IRPF model, in force since January 2026, establishes tax exemption for monthly income up to R$ 5,000 and changes taxation for high-income earners and dividend recipients.

Progressive IRPF Table — Effective 2026

Annual Income (R$)	Rate	Deductible Amount (R$)
Up to 60,000.00	Exempt	—
60,000.01 — 120,000.00	7.5%	4,500.00
120,000.01 — 240,000.00	15%	13,500.00
240,000.01 — 360,000.00	22.5%	27,000.00
Above 360,000.00	27.5%	48,000.00

Taxation of Dividends and High-Income Earners

The new model also introduced taxation on dividends and capital income above R$ 600,000 per year, applying an additional rate of 2.5% to 5%, depending on income level.

As a result, professionals receiving business profits, rental income, or investment returns must structure their income carefully to prevent double taxation and ensure compliance.

3. Other Relevant Tax Obligations

In addition to IRPF, remote workers residing in Brazil may be subject to other taxes, depending on their circumstances:

• INSS: mandatory for employees and optional for freelancers; rates vary from 7.5% to 20%.

• ISS: applies to service providers and MEI professionals; municipal rates range from 2% to 5%.

• IPTU: due for urban property owners; rental contracts may transfer payment responsibility to tenants.

Even when the work is performed remotely for a foreign entity, the Federal Revenue Service considers the income taxable under the principle of universal taxation.

4. Digital Nomad Visa and Foreigners in Brazil

The digital nomad visa, created in 2021, remains in effect and allows foreigners to stay in Brazil for up to 12 months, renewable, provided they demonstrate:

• professional remote work tied to a foreign employer,

• minimum monthly income of US$ 1,500 or bank balance of US$ 18,000,

• health insurance valid in Brazil,

• no criminal record.

Although temporary, the visa can trigger tax residency, obligating the holder to declare and pay taxes under Brazilian rules.

5. Dual Tax Residency and International Treaties

Individuals maintaining ties with two countries — for example, Brazilians living part-time abroad — may fall under dual tax residency.

Brazil currently maintains 35 tax treaties to avoid double taxation, including with Portugal, Spain, France and Japan.These agreements establish which country has priority to tax specific types of income and allow foreign tax credits to avoid double payment.

Still, proper tax planning is crucial when exiting or returning to Brazil.

6. Tax Planning: A Necessity, Not a Luxury

The expansion of international remote work has opened new opportunities — but also new tax exposure.

Ignoring tax obligations or relying on oversimplified assumptions ("I earn abroad, so I pay nothing in Brazil") may lead to penalties, retroactive tax assessments, and even criminal liability for tax evasion.

Strategic tax planning is the safest path to legal protection and to fully leveraging tax treaties and the 2026 IRPF exemptions.

If you are interested in legal assistance with tax planning in Brazil, contact: contato@trpuppioadvocacia.com.br, or by WhatsApp.