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Revenue Updates Income Tax Return Standards


Points that generate doubts, such as medical expenses and research grants, were clarified in an instruction published by the Treasury

The Internal Revenue Service consolidated on Monday (6), the rules of taxation of Personal Income Tax (IRPF). The amendments are in  normative instruction published in the Official Gazette of the Union and have as objective "to unify the legislation on the tax and to guide the taxpayer with respect to the interpretation that has been adopted by the Treasury".

In the statement, the Revenue explains, among other points, that the taxpayer can not enter in the statement medical expenses that are not part of the previous calendar year. That is, in the 2018 statement, no medical expenses before 2017 could be released. On in vitro fertilization expenditures, the standard determines that they will be deductible only in the statement of the patient who received the medical treatment.

The norm also clarifies that there is only exemption from income tax in relation to income derived from sickness insurance, which has a social security nature, and there is no exemption for the income derived from a license for health treatment, because of salary nature.

In relation to scholarships granted by the Scientific, Technological and Innovation Institutions (ICT) to carry out research activities, the Revenue explains that they are as a donation and do not constitute employment relationship and, therefore, are exempt from income tax.

Since the shared custody situation, which generates doubts among taxpayers when making the declaration, each child can be considered as dependent on only one parent. 

Other benefits

In relation to some tax benefits that had their deadlines extended, the time for deducting the tax was established: amounts spent as sponsorship or donation in the direct support of sports and sports projects - up to the calendar year of 2022; values corresponding to donations and sponsorships directly in favor of actions and services under the National Program of Support to Cancer Oncology (Pronon) and the National Program to Support the Health Care of Persons with Disabilities (Pronas / PCD) - until the year -calendar of 2020; amounts related to investments and sponsorships made in the production of cinematographic audiovisual works approved by the National Cinema Agency (Ancine), as well as in the acquisition of quotas of Financing Funds of the National Cinematographic Industry (Funcines) - until the calendar year of 2017.


Source: Government of Brazil, with information from the Federal Revenue Service