By Jay Forte, Contributing Reporter

RIO DE JANEIRO, BRAZIL – Expats often face confusing scenarios with tax reporting obligations in more than one country. Some are reluctant to seek tax advice because they intend to stay in Brazil for just a few months and over time (as many of our readers know!), this becomes a few years, resulting in tax obligations and potential penalties for not having taken action earlier.

Amit Ramnani of Ipanema Wealth, helps expats prepare for the unexpected, photo curtesy of Ipanema Wealth.
Amit Ramnani advises expatriates to review their financial planning, photo courtesy of Ipanema Wealth.

The cost of tax advice in more than one country is often perceived as too expensive, Amit Ramnani of Ipanema Wealth explains, “Many expats believe that tax planning is more suited to high net worth individuals which is why Ipanema Wealth has enabled the provision of global tax advice at accessible rates, helping clients to prioritize and avoid paying unnecessary fees.”

The OECD is taking major steps to reduce tax evasion by 2018 with the Common Reporting Standard (CRS). The CRS is aiming for the automatic exchange of financial information amongst participating countries which include Brazil, most of Mercosul, Canada and the EU. Some countries already have bilateral and multilateral sharing agreements in place e.g. United States (FATCA).

Most financial institutions are currently asking accountholders for Tax Identification Numbers (e.g. CPF in Brazil) to comply with future requests from the tax authorities of where their accountholders are resident.

The Brazilian government is currently offering a tax amnesty (Special Regime for Monetary and Tax Regulation) for undeclared overseas assets until October 31st, which may be extended until November 16th. Individuals face a one-off penalty equal to thirty percent of their account balances at December 31, 2014.

This is a unique opportunity for those in irregular positions compared to the scenario of being identified via CRS information exchanges in the future. Yet many have questions, for example, U.S. citizens residing in Brazil with income and assets in both countries, many ask about their reporting obligations.

Mr. Ramnani explains “You need to complete income tax returns and asset statements in both, the U.S. and Brazil. If your foreign assets are greater than US$100,000 in value, this needs to be declared with the Central Bank in Brazil.”

He reiterates, “For peace of mind, it is better to confront any doubts than procrastinate and allow a potential error to snowball into a serious situation.” Mr. Ramnani also suggest watching the Ipanema Wealth video on advising “distressed clients”.

Disclaimer: Ipanema Wealth provides an advisory service and does not engage in capital markets activity. For more information, please submit a specific enquiry via their website here.

* This is a Sponsored article by Ipanema Wealth.


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