Quote:
Originally Posted by RalphJ
It's 5% of the value that is on the deed. If you buy a piece of beach front property for 1,000,000 reais, and 1,000,000 reais is the value on the deed, you pay 50,000 reais only for the "terreno da marinha" tax.
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Now, this is the
KEY! The value "on the deed", or escritura. And let me tell those interested in investing in brazil that open their own brazilian business, that will be making a "foreign investment in Brazil", be
VERY careful in respect to this...the value that is put on deeds, receipts, not receiving receipts, and not only receipts, but one
MUST receive a "
NOTA FISCAL" when paying for ANYTHING from your business account.
A foreign investor who opens his own business and who is not familiar with the way business is done in Brazil will soon find himself in a precarious position. He will find that when buying land or property people will not want to put the actual sales price(s) on the deed(s). Naturally they do this for tax purposes. I used to think this was sinful but since I wholeheartedly agree with them. Brazil is the 2nd most heavily taxed country on planet earth, and we see
very little in return for those tax dollars. This is a WIDELY COMMON practice, it is done by EVERYONE, lawyers, judges, politicians, policemen....it doesn't matter.....EVERYONE does this in Brazil.
The foreign investor will then find this is a common practice not only in buying real estate, but in everything. If you contract an architect, if you go to buy construction materials, if you hire a topographer, to just about anything, people here have an aversion to giving receipts, and in particular, receipts which are fiscally legal with Receipta Federal (a nota fiscal). Normally someone like an architect, if you're going to spend any type of significant monies at all will give you two prices, one with a "nota fiscal" and one without. And these price differences can be as much as 40% in my experience.
Be VERY careful here. A company making a foreign investment in Brazil must account for EVERY SINGLE CENTAVO THAT LEAVES HIS ACCOUNT! In other words, one must have a NOTA FISCAL, or "legal receipt", for every single penny that was paid from his business account(s). It's very tempting to get a 40% discount on a large ticket item...but what do you do afterwards? At the end of the year when you declare your taxes how do you account for this money that has left your account? Well, I won't even discuss the options because they're illegal. And if one doesn't know this going into his investment.....and DEMAND for a legal receipt, or nota fiscal, with each and every purchase from his business account, years down the road he very well may find himself in hot water with Receipta Federal.