Neobank Account Abroad: What Brazilians Report and Pay

Yes, a Brazilian resident can hold an account at a neobank abroad if they follow Brazilian rules: report the income on the DAA, taxed at 15%, and file the CBE with the Central Bank when assets abroad total US$ 1,000,000.00 on December 31. Whether the bank accepts Brazilians is the bank's decision.

Revolut, N26 and Monzo show up in searches by people who want an account abroad. This guide does not say which of them open accounts for residents of Brazil, nor does it give fees or limits, because those change and only what appears in each bank's terms counts. What does not change from bank to bank is the Brazilian side, and that is where this text focuses, based on Law No. 14,754/2023 (Lei 14.754/2023), Law No. 14,286/2021 (Lei 14.286/2021) and BCB Resolution 279/2022.

Can a Brazilian have an account at a neobank abroad?

Yes. BCB Resolution 279 (art. 2) says Brazilian capital abroad may be invested in any form regularly practiced in the international market. The law defines that capital as funds, goods, rights and assets of any nature held outside the country by residents (Law 14,286, art. 8, I).

The fact that Brazilian law permits the account does not oblige the foreign bank to open it. The neobank decides whom it accepts as a client, under the rules of its country and its license. Read the bank's terms for residents of Brazil before counting on the account.

How do you send money from Brazil to the account abroad?

Through an institution authorized to operate in the foreign exchange market. BCB Resolution 279 (art. 6) requires financial transfers related to Brazilian capital abroad to go through an institution authorized to operate in foreign exchange, subject to the limits and conditions of the legislation and regulation.

Keep the receipt for each transfer. The rule requires you to keep for 10 years the documentation that proves the flows and stocks of capital abroad, and the Central Bank may request it during that period (art. 3, sole paragraph). The limits and conditions of each foreign exchange operation change, so check with the institution you will send through. Our offshore banking service helps organize that path.

When does the balance of the foreign account generate tax in Brazil?

It depends on whether the account earns anything. Law 14,754 treats an account without earnings differently from an account or digital wallet that pays earnings.

Two points call for attention in your case. First, the exchange-rate variation exemption requires an account without remuneration and a financial institution authorized by the local monetary authority. Confirm with the neobank what type of license it has and what type of product your account is, and ask your accountant for the conclusion for your case. Second, the classification of digital wallets depends on a Federal Revenue Service regulation. Check the current text before filing.

How do you report foreign account income on the DAA?

The income goes on the Annual Adjustment Return (DAA), on a separate schedule from other income, in the period in which it is actually received (Law 14,754, arts. 2, caput, and 3, § 2). Interest and other remuneration count when received. Gains, including exchange-rate variation on the principal, count on redemption, amortization, disposal, maturity or settlement.

Practical steps:

1. •Gather the year's statements for each account and card abroad, with the earnings and the transactions.
2. •Separate what is income (interest, remuneration, gains) from what is just balance or exchange-rate variation on an account without remuneration.
3. •Convert the amounts to reais according to the Revenue Service rule and add up the year's income.
4. •Offset losses, if any. The law allows realized losses on financial investments abroad, proven by proper documentation, to be offset against income of the same period and, if any remain, of later periods. Each loss can be offset only once (art. 9).
5. •Assess the credit for tax paid abroad. It can only be deducted if provided for in a double taxation treaty or reciprocity of treatment, if it is not refundable abroad and within the limit of the law (art. 4).

More details in the guide how to report an offshore on your income tax return.

When do you need to file the CBE with the Central Bank?

When the sum of your assets abroad reaches US$ 1,000,000.00 on December 31. BCB Resolution 279 (art. 10) sets that threshold for the annual declaration and the base date of December 31. The threshold considers the total, not each account in isolation.

The person responsible for the information is subject to the penalties of the legislation (Res. 279, art. 16; Law 14,286, art. 20). The neobank balance adds up with other accounts, real estate, equity interests and investments abroad. See the Central Bank's CBE page and the Declarant's Manual (Manual do Declarante) provided for in art. 17 of the resolution. To find out whether the total of your wealth abroad justifies a structure, read at what level of wealth an offshore is worth it.

Does an account in the name of an offshore company change the treatment?

Yes. In an individual's account, the earnings go on the DAA as a financial investment. If the account belongs to a company you control abroad, the controlled-entity rule of Law 14,754 applies (art. 5).

The law considers an entity controlled when the individual holds rights that ensure a preponderance in decisions or the power to elect the majority of the directors, or more than 50% of the capital or profits. The profits of these entities are taxed on December 31 of each year, at a 15% rate, when the controlled entity is in a favored-taxation country or privileged regime, or has its own active income below 60% of total income (art. 5, §§ 1 and 5). For other controlled entities, taxation occurs when the profit is made available to the resident (art. 6).

On the CBE, an interest in a non-resident company is one of the items reported (Res. 279, art. 7, I). The choice between a personal account and a company account should be made with an analysis of your case and of the company's country. See asset privacy and legal strategies and bank accounts in the Cayman Islands.

What should you check before opening an account at a neobank abroad?

Check what the bank itself publishes and what your accountant needs to file. This list helps you avoid taking an account you cannot report or prove later.

1. •Who issues the account and which authority supervises it. Ask the bank about the type of license.
2. •Whether the account earns remuneration. This determines whether the earnings fall under the 15% tax and whether the exchange-rate variation rule applies.
3. •Whether the bank accepts residents of Brazil, and what documents it asks for. See the bank's own official terms page.
4. •Whether there is an annual statement with the balance on December 31 and the year's earnings, which you use on the DAA and the CBE.
5. •How the money comes in: send through an institution authorized to operate in foreign exchange and keep the receipt.
6. •Whether the account is joint; remember the full-amount rule for the CBE.

To keep track of all your obligations, a review with our compliance team is worthwhile.