Brazil

Brazil legally classifies cryptocurrencies as virtual digital assets or property, subjecting them to income taxation. The country's crypto landscape is regulated, meaning operations and holdings are legal but subject to a dedicated framework of rules and reporting requirements. The primary authority for cryptocurrency taxation and compliance in Brazil is the Secretaria Especial da Receita Federal do Brasil (RFB), which is the Federal Revenue Service. It governs these activities under tax guidance, notably through the Declaração de Criptoativos (DeCripto) system. Individual investors in Brazil face a flat tax rate of 15% to 17.5% on all cryptocurrency gains. This rate applies uniformly to capital gains from selling or exchanging crypto, as well as to other forms of crypto income. There is no distinction between short-term and long-term holdings, the same flat rate applies regardless of how long an asset is held. Importantly, converting cryptocurrency to fiat currency or swapping one cryptocurrency for another are both considered taxable events. For corporate entities, the standard income tax rate is 15%, which can increase to an effective rate of up to 34% with surcharges, depending on the business structure. Cryptocurrency transactions are exempt from Value Added Tax (VAT) or Goods and Services Tax (GST). Various crypto activities are taxed consistently under the 15% to 17.5% flat rate. Staking rewards are taxed upon receipt. Mining income is also subject to this flat rate, with general business rules allowing for the deduction of associated costs. Decentralized Finance (DeFi) activities, including yield farming, liquidity provision, lending, and borrowing, each trigger a taxable event. Non-Fungible Tokens (NFTs) are treated as other digital assets, with no special collectibles exemption, meaning their creation, purchase, and sale are taxed at the flat rate. Brazil has undertaken significant reforms, effective as of 2026, to align with international standards. The updated DeCripto system, effective July 2026, mandates comprehensive monthly reporting. While crypto exchanges must report all client transactions, individuals are required to report direct transactions (those not facilitated by an exchange, or through foreign exchanges) only if the monthly volume exceeds R$ 35,000. Brazil has also adopted the Crypto-Asset Reporting Framework (CARF), facilitating automatic information exchange with over 70 jurisdictions. Additionally, enhanced Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements are now in place for crypto service providers.