How to Declare an Offshore on Brazilian Income Tax in 2026

An offshore company is declared on the Brazilian income tax return in two parts. The ownership stake goes on the Assets and Rights form, and foreign income goes on its own form under Law No. 14,754/2023 (Lei 14.754/2023), with 15% tax paid in the annual adjustment.

If the offshore is a passive controlled company, or is in a low-tax jurisdiction, each year's profit is included in taxable income even without distribution. Anyone with US$ 1 million or more abroad on December 31 also files the CBE (Brazilian Capital Abroad report) with the Central Bank of Brazil (BCB).

This guide follows the order of the filing: which rules apply to your structure, what goes on each form, how to convert the amounts, and how to fix an offshore that was never declared.

Which rule of Law 14,754/2023 applies to my offshore?

It depends on the type of structure. Law 14,754/2023 separates four situations:

There is also the transparency option (art. 8). With it, the company's assets are declared as if they belonged to the individual, and each item of income follows the financial investment rule. The option is irrevocable for as long as you own the company and, if there is more than one partner resident in Brazil, all of them must make it.

A tax-transparent U.S. LLC whose member is not a U.S. resident is treated by Brazil's Federal Revenue Service (Receita Federal) as a privileged tax regime (RFB Normative Instruction 1,037/2010 and Cosit Consultation Ruling 56/2026), so it falls under the rule of art. 5. See Delaware LLC for Brazilians.

What goes on each form of the tax return?

Profits of an art. 5 controlled company, already taxed on December 31, are not taxed again when distributed. On distribution, you identify the controlled company and the year of origin, and the amount reduces the dividend credit receivable (art. 5, § 11).

How do I convert the amounts into reais?

The profit of the art. 5 controlled company is converted at the Central Bank's closing selling rate on the last business day of December (art. 5, § 10, II). The controlled company's annual balance sheet follows IFRS or Brazilian accounting standards. If the controlled company is in a low-tax jurisdiction or under a privileged tax regime, only the Brazilian standard is valid (art. 5, § 10, I).

Two details prevent mistakes:

• •Exchange variation on the dividend. The difference between the reais value of the profit taxed on December 31 and the reais value of the dividend received later is neither taxed nor deducted (art. 5, § 12).
• •Non-interest-bearing checking account. Exchange variation on non-interest-bearing deposits held at an authorized institution abroad is not taxed (art. 2, § 3). An interest-bearing account is treated as a financial investment.

How do I offset losses?

Realized losses on financial investments abroad, if documented, offset investment income in the same year. If anything is left over, they offset controlled-company profits declared in the same year. The balance carries over to the following years, and each loss can be offset only once (art. 9, § 3).

When is the CBE filing with the Central Bank mandatory?

The Brazilian Capital Abroad report (CBE) is annual for anyone holding assets and rights abroad of US$ 1 million or more on December 31. It becomes quarterly from US$ 100 million (Central Bank of Brazil - CBE). It is separate from the income tax return, and neither replaces the other. The amounts in both must be consistent, because the Federal Revenue Service and the Central Bank cross-check the information.

What are the most common mistakes?

1. •Declaring the trust as a single item. The law requires declaring the assets held inside it (art. 11).
2. •Assuming undistributed profit is not taxed. For art. 5 controlled companies, it is taxed every December 31.
3. •Not recording the dividend credit receivable. Without it, a future distribution looks like new income.
4. •Deducting tax paid abroad without a treaty or reciprocity. The deduction depends on one of them (art. 4).
5. •Converting at the wrong exchange rate. The rule for the controlled company's profit is the Central Bank's closing selling rate on the last business day of December.
6. •Forgetting the CBE when assets abroad exceed US$ 1 million.
7. •Using an accountant with no experience in foreign controlled companies. The controlled company's balance sheet must follow specific accounting rules.

How do I regularize an offshore that was never declared?

The path is to amend the returns for the open years, with the tax due and interest, before any audit. Article 138 of the National Tax Code (Código Tributário Nacional, CTN) removes liability for the infraction when a voluntary disclosure is accompanied by payment of the tax and interest. This no longer applies once an audit procedure on the infraction has already begun.

Each case needs a review of the structure's history: creation date, contributions, profits of each year and distributions. Regularization may also involve the CBE for the mandatory years. See regularization of undeclared assets abroad and the compliance service.

What documents should I gather before filing?

• •December 31 statements for all accounts and brokerages abroad.
• •Annual balance sheet of the controlled company, in the required accounting standard.
• •Proof of contributions and of the acquisition cost of the ownership stake.
• •Minutes or proof of profit distributions, with the year of origin.
• •Proof of tax paid abroad, if any.
• •For trusts: deed, letter of wishes and a list of the underlying assets.

Conclusion

Declaring an offshore in 2026 means following the rules of Law 14,754/2023 according to the type of structure. A personal account pays when the income is realized. A passive controlled company pays every December 31. A trust is declared through the assets inside it. The costliest mistakes are failing to tax undistributed profit and forgetting the CBE. To prepare the return or regularize past years, book a consultation or see the tax planning service. If the structure does not exist yet, first see the net worth at which an offshore is worth it.