Brazil and Cryptocurrency Normative Instruction

Brazil and Cryptocurrency Normative Instruction - crypto assets brazil

In 2019, the Normative Instruction No. 1,888/2019 (“IN 1888”) was published; it is effective since August 1, 2019. The IN 1888 establishes which entities and individuals must provide the Brazilian Federal Tax authorities (Receita Federal “RF”). IRS with information on cryptocurrency transactions, and what information must be disclosed.



Here is a short summary of the IN 1888:


  • The information must be sent electronically and digitally signed by the individual, the legal representative of the legal entity or the attorney; it must be submitted through website (“e-CAC”) of the R.


  • Who is required to provide information to the RF for cryptocurrency transactions?:
    • the so-called Digital Currency Exchangers (“DCE”), domiciled in Brazil, and
    • the individuals and legal entities, resident and domiciled in Brazil, engaging in transactions with DCEs domiciled overseas or without the intermediation of a DCE if the monthly value of the transactions exceeds thirty thousand reais (BRL 30,000.00).
  • The value expressed in foreign currency must be converted:
    • in USD,
    • in BRL.


  • The following information and event must be disclosed:
    • purchase and sale,
    • exchange,
    • donation,
    • transfer of crypto assets to the Exchange,
    • withdrawal of crypto assets from the Exchange,
    • temporary assignment (rent),
    • payment in kind,
    • issuance,
    • other operations that involve the transfer of crypto assets.


  • The information to be provided to the Brazilian RF includes the type of operation and the amount of the cryptocurrency used; the transaction value in BRL; the address of the remittance and receipt wallet; and, if the DCE is domiciled overseas, the DCE’s name.


  • In addition to the monthly information report, the DCEs must also provide, regarding each of their users, the following information on December 31 for each calendar year: 
    • the balance of fiduciary coins, in BRL
    • the balance of each cryptocurrency, in the unit of the respective cryptocurrency;
    • the acquisition cost of each type of cryptocurrency, in BRL. 


  • About the deadlines, information must be transmitted to the RF monthly on the last business day of:
    • The calendar month following the one in which the set of operations carried out with crypto assets occurred, regarding the obligations provided for in art. 7th,
    • January of the subsequent calendar year, regarding the annual obligation.


  • There are penalties for late disclosure:
    • 500 BRL per month or fraction of a month, if the declarant is a legal entity opting for the Simples Nacional Tax regime,
    • 1,500 BRL per month or fraction of a month, for others legal entities,
    • 100 BRL per month for an individual.


  • And penalties for providing inaccurate, incomplete or incorrect information or omitting information (the IN 1888 exempt the party from fines if the correction is done before the IRS’s inspection):
    • 3% of the value of the transaction to which the omitted, inaccurate, incorrect or incomplete information refers, if the declarant is a legal entity; or
    • 1.5% of the value of the transaction to which the omitted, inaccurate, incorrect or incomplete information refers, if the declarant is an individual.