The Brazilian government states that about 32 million taxpayers must declare their income this year. The balances for the purchase of cryptocurrencies are reflected according to the value on the date of acquisition.

The Brazilian Senate had requested the Tax Agency to postpone the deadline to declare income tax, which originally closes on April 30th, due to the coronavirus pandemic. However, according to local media, government officials had not granted the extension.

However, the news portal G1 (Globo Network) reported last April 1st that the Brazilian Tax Agency decided to postpone the term to declare income tax until June 30th. This presents an excellent opportunity for those who have not yet declared their movements with Bitcoin and other cryptocurrencies, and the government officials can now study the subject in more detail.

Extended Term

According to the publication, José Tostes Neto, who is the secretary of the Tax Agency, announced on April 1st that they would postpone the deadline for the submission of declarations of income tax by natural persons by 60 days. Therefore, the final date originally scheduled for April 30th would now be for June 30th.

Regarding the alteration of the deadline, the official stated that this term will expire on April 30th and have an extension until June 30th. As a consequence, the tax declaration submission period for natural persons will have a two-month extension.

The coronavirus pandemic may also affect repayment terms as the first batch occurs on May 30th and the Tax Agency is deciding whether to maintain the deadline. The secretary of the Receita Federal provided the information during a collective interview conducted at the Palacio do Planalto, which other members of the government also attended.

Until March 30th, the Tax Agency had made an assessment that defined 8.1 million declarations that had been submitted. This corresponds to 25% of the total previously foreseen since the government states that about 32 million taxpayers in 2020 are submitting declarations of income tax for natural persons.

Consequently, the extension of the term can help cryptocurrency investors, since the Brazilian tax agency Receita Federal has not published specific guidelines to declare profits from transactions in crypto assets in the income tax returns. On the other hand, many investors are lost concerning the procedures that the government office has adopted.

However, various financial portals recommend reporting cryptocurrency transactions under the heading “Other Assets and Rights”. In the case of cryptocurrency purchases, the taxpayer must record the value that the cryptocurrencies had at the time of the acquisition, regardless of the fluctuation that it has had at the time of the declaration, according to the website ValorInveste.

The taxpayer must declare the balances in cryptocurrencies in the Goods and Rights form, in the “Other Goods and Rights” field below, which is item 99 in the form.

In the case of profits obtained from the sale of cryptocurrencies, taxpayers must declare them only if the sale operation exceeds BRL 35,000, equivalent to USD 6,650.

By Alexander Salazar


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