Bahamas Trusts for Brazilians: What Law 14,754 Requires

For a Brazilian resident, a Bahamas trust does not take assets out of reach of income tax. Under Law No. 14,754/2023 (Lei 14.754/2023), assets in a foreign trust stay with the settlor until distribution to the beneficiary or the settlor's death, and income is taxed under the rules that apply to the owner.

How does Law 14,754 treat a trust in the Bahamas?

Brazilian law looks at a trust through the relationship between the people involved, not through the country. Art. 12 defines a trust as a "contractual arrangement governed by foreign law" that sets out the relationship among settlor, trustee and beneficiaries. A trust governed by Bahamian law qualifies. Arts. 10 to 13 set the rules below for an individual resident in Brazil:

The settlor is the individual who allocates their assets to form the trust. The trustee is the person with the fiduciary duty to manage them according to the trust deed and, if there is one, the letter of wishes (art. 12, II and III).

What should the settlor require from the trustee?

The law places on the settlor and the beneficiary the duty to obtain the information needed to pay the tax. Art. 10 sets out four practical rules:

1. •Request for resources and information. The settlor or the beneficiary must request from the trustee the financial resources and the information needed to pay the tax and meet the other obligations in Brazil (§ 5).
2. •Clause in the deed. For trusts that existed when the law was published, the living settlor or the beneficiaries who knew about the trust had to amend the deed or the letter of wishes, within 180 days, to bind the trustee to comply with the law (§ 6). For a new trust, ask your lawyer whether the deed already includes an equivalent clause.
3. •Deceased settlor. If the settlor has already died or lost the power to amend, the beneficiaries send the trustee a formal notice about the requirements of the law (§ 7).
4. •Trustee refusal. If the trustee does not comply with the request, the settlor or the beneficiary remains bound by the principal and ancillary obligations (§ 8).

In short, the tax duty stays with the owner even when the trustee does not cooperate. For a comparison with other structures, see trusts and asset protection for Brazilians.

Who regulates trusts and banks in the Bahamas?

The Central Bank of The Bahamas states that, under the Banks and Trust Companies Regulation Act, 2000 and the Central Bank of The Bahamas Act, 2000, it licenses, regulates and supervises the banks and trust companies that operate in or from The Bahamas. The Central Bank page is the starting point to check whether the institution you hired is licensed.

The validity and administration of the trust follow local law, and that is the law the trustee and the Bahamian lawyer use to design the instrument. This article does not detail the provisions of that law. Ask the local lawyer for the applicable law and a written opinion before signing the deed. For the Brazilian-side structure, see corporate structures and the offshore banking service; for an overview of the jurisdiction, see the Bahamas page.

Account opening costs, trustee fees and minimum bank balances vary by institution and are not found in any official source consulted. Get a written quote before deciding.

Do the Bahamas report the trust to Brazil's Federal Revenue Service?

They may, through the CRS, when the bank account of the trust or of the owner is reportable. The exchange requires an agreement in force between the two countries and the inclusion of Brazil on each side's list of jurisdictions. The Bahamas signed the Multilateral Competent Authority Agreement (MCAA) on December 13, 2017, with a first exchange expected for September 2018, according to the OECD list as of March 13, 2025. Brazil signed on October 6, 2016. The Bahamas signed the Addendum, the expanded version of the agreement, on April 14, 2025, according to the list as of October 1, 2026.

The central point for trusts is the figure of the controlling person. IN RFB 1.680/2016 defines, for a trust, the settlor, the administrators (trustees), the protectors, if any, the beneficiaries or classes of beneficiaries and any other individual who exercises ultimate control. The exchange includes the name, address, taxpayer identification number (TIN), balance and gross income of the account. The Addendum adds, for interests in an investment entity that is a legal arrangement, the role by which the reportable person holds the interest.

The article on CRS and automatic exchange of information details the data and the timeline. The US Treasury list also records a FATCA agreement in force with the Bahamas since September 17, 2015, which matters if the owner or the structure has a US connection.

How do you declare the trust on the DAA and to the Central Bank?

These are two separate declarations, and the second has a point that needs confirmation.

• •DAA. The assets and rights of the trust are declared directly by the owner, at acquisition cost (Law 14,754/2023, art. 11). Anyone who has already reported the trust itself on the DAA must replace it with the underlying assets and rights (art. 11, § 1). Income from financial investments abroad goes on the DAA at a 15% rate (art. 2, § 1).
• •CBE. Central Bank Resolution BCB 279/2022 treats as Brazilian capital abroad the assets whose ownership was transferred, through any arrangement, revocable or not, to a fiduciary agent abroad, for administration in favor of specified resident beneficiaries (art. 7, § 2). The responsibility for reporting lies with the resident beneficiary of these arrangements (art. 8, sole paragraph, III). The annual declaration applies from USD 1,000,000.00 on December 31 (art. 10; see also the CBE page at the Central Bank).

The BCB rule speaks of the resident beneficiary. If the resident settlor is not a beneficiary, confirm with the Central Bank of Brazil or an accountant how the CBE applies to your case. The article on how to declare offshore on your income tax return shows how to fill in the DAA.