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Currency restrictions

Currency restrictions

Old Aug 5, 16, 4:09 am
  #1  
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Currency restrictions

I've done business with a Brazilian company for almost 10 years. With the recent economic upheaval they've stopped paying me my royalties. Part of it is the significant tax they must pay to transfer the money to my US accounts.

I'm visiting them soon to review operations. They've just advised me that they are prepared to give me US dollars that will be over the 10,000 R limit that is stated on the Brazilian Customs page.
Don't want to say "no" to the money... Don't want to get stopped by BRA Customs...what to do...
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Old Aug 5, 16, 5:43 am
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As far as I remember, these 10000 are not a limit, just the money has to be declared if above...
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Old Aug 5, 16, 7:47 am
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Don't forget that you'll need to declare the currency if over US$10,000 when you enter the USA.
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Old Aug 5, 16, 10:13 am
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Entry and exit regulations are the same. No limit on currency but amounts in excess of BR 10,000 (or equivalent) must be declared.

Receita Federal will want to be sure all taxes have been paid on currency leaving the country.

Sounds like the company is shifting the tax burden or risk of currency seizure to you. I hate to sound paranoid but better to keep your departure date to yourself.

FYI: I've only read about a foreigner declaring funds one time upon entry and the agent basically said it wasn't smart to tell anyone that he was carrying that much cash. Infer what you will but I am NOT advising you to violate the law.

http://www.iatatravelcentre.com/BR-B...ns-details.htm

https://travel.state.gov/content/pas...ry/brazil.html
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Old Aug 5, 16, 1:23 pm
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I always declare with US Customs, I have a legitimate business and this is normal income. I don't know which tax the Brazil Customs might apply to the funds, my customer stated they would pay over 40% to pay by bank transfer for royalty expense. We discussed PayPal and other wiring alternatives, but they are all monitored by the government and they would have to pay the tax.
This tax would of course reduce the amount applied to their debt.

Now either the tax, or the risk, is being transferred to me. I don't like it, but again, I don't have much leverage if I want to salvage anything out of this. I wonder if there is a lower tax rate I could "declare" for? e.g. Gambling, consulting, etc

They are a small family business, fewer than 15 employees, and they have been hammered between an imploding economy and a devaluation that has more than doubled their cost for my product, effectively ending my sales to them.
They mean well....

Last edited by Hawaiino; Aug 5, 16 at 3:10 pm Reason: Clarification
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Old Aug 6, 16, 7:45 pm
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Originally Posted by Hawaiino
they have been hammered between an imploding economy and a devaluation that has more than doubled their cost for my product, effectively ending my sales to them.
What devaluation you mean? In March the rate was 1 USD=4 BRL, now despite all the turmoil, presidential impeachment, petrobras corruption, the rate is 1 USD = 3.20 BRL.
An unbelievable mystery of the world.
The real is stronger by 20% and so is cheaper all the imports coming to Brazil.
We, visitors to Brazil, suffer too, having to pay 20% more in the already expensive country.

Last edited by abeyro; Aug 6, 16 at 7:50 pm
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Old Aug 7, 16, 6:38 pm
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Yes, with the recent political events the currency has (slightly) strengthened this year. But our business has longer term cycles and the devaluation since Lula left office and Dilma took over has been severe.
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Old Aug 9, 16, 4:07 pm
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Like others have said here, I don't want to encourage you to break/bend the rules, but...

I guess it all boils down to the amount involved. I guess if it's BRL 20k, even a bit less, and the risk is relatively small as exit inspections are rare, and even so they'll turn a blind eye to breaking the limit within reason.

Last edited by RafKa; Aug 9, 16 at 4:13 pm
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