Tax accountant with crypto reports and tax forms

Tax accountant reviews crypto reports and IRPF forms, highlighting the growing tax complexity of digital investments in Brazil.

About this subject

Filing the Brazilian Personal Income Tax (IRPF) has become more challenging with the rise of cryptocurrencies. Since 2019, the Brazilian Federal Revenue requires investors to report crypto transactions, including purchases, sales, exchanges, and transfers. A tax accountant specialized in cryptocurrencies must master both Brazilian tax legislation and the specifics of exchanges like Binance, Mercado Bitcoin, and Foxbit.

The process involves reconciling statements from multiple platforms, converting values to Brazilian reais based on the daily exchange rate, and correctly filling out the Assets and Rights section. Capital gains exceeding R$ 35,000 per month from crypto sales are taxed at progressive rates from 15% to 22.5%. Transactions below this threshold are exempt but still must be declared.

The Federal Revenue created Normative Instruction 1.888/2019, requiring domestic exchanges to report client operations. For transactions on foreign exchanges or peer-to-peer, taxpayers must file a monthly crypto report if the total amount exceeds R$ 30,000. Non-compliance can result in fines of 1.5% to 3% of the transaction value.

With increased oversight, accounting firms have invested in specialized software that automates data import from exchanges and calculates taxes. Today's tax professionals need to understand blockchain, DeFi, and NFTs to properly advise clients. The trend is toward stricter regulation, with proposals to tax cryptocurrencies held abroad and establish a comprehensive legal framework for the sector.

Frequently Asked Questions

Who needs to declare cryptocurrencies in the Brazilian IRPF?

All investors who carried out crypto transactions in 2023 must declare them in the Assets and Rights section, regardless of value. Additionally, those who sold more than R$ 35,000 in crypto in a single month must pay capital gains tax.

How to calculate tax on cryptocurrencies in Brazil?

Tax is levied on capital gains (difference between sale price and acquisition cost) for monthly sales above R$ 35,000. Rates range from 15% to 22.5%, depending on profit. Taxpayers must use the Federal Revenue's GCAP program to generate the DARF payment slip.

What happens if I don't declare cryptocurrencies?

Omission can result in fines of 1.5% to 3% on the undeclared transaction amount, plus interest. In cases of tax evasion, the taxpayer may be investigated by the Federal Revenue and face more severe penalties, such as being flagged for audit.