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Brazilian Crypto Users Must Report to the IRS Starting Today

From today, 1st of August, 2019, the citizens of Brazil, will be compulsorily required to report on all of the crypto transactions they engage in to the Brazilian regulatory body the IRS or Internal Revenue Service. All entities and individuals that are involved in dealing with cryptocurrencies like Bitcoin, Ether and more, will be expected to file a detailed report with the IRS. The rules for such reporting can be found in the Normative Instruction 1888 that had been introduced earlier this year, in the month of May.

As per reports from Brazil’s mainstream news media outlets, the new directive will be applicable to a wide variety of users, including standalone individuals, companies and brokerages. The rules will have no exceptions for any kind of crypto-related activities, be it buying and selling, or a charitable act of donation. The cases of barters, deposits and withdrawals must be reported to the regulatory body as well.

As a result of the new measure, all entities will have to submit monthly reports at the end of each month they engage in any kind of crypto-based transactions. Basically, according to the rules, the data from crypto transactions engaged in, in the month of August should be reported by the last business day of the successive month, that is September.

Local crypto exchanges must abide by these rules regardless of how small or large the value of their crypto transaction may be. However, for those entities using foreign exchanges or brokerages, the rules are slightly different as they will be compelled to report only if their transactional value exceeds 30,000 Brazilian reais in any month.

Penalties ranging between 1.5 to 3 per cent of the amount of unreported transaction stand to be applied to those who try to evade reporting. Those who fail to report may have to pay anywhere between 100 and 500 Brazilian reais as penalty.