New income tax rules approved by the Brazilian Senate may require Brazilians to pay up to a 15% tax on income from cryptocurrencies held on foreign exchanges.

The bill, having already passed in the Chamber of Deputies, is anticipated to be approved by President Luiz Inácio Lula da Silva, who initiated the income tax rule changes.

Effective January 1, 2024, the tax applies to any Brazilian earning over $1,200 (6,000 Brazilian reals) on foreign exchanges, aligning their tax rate with funds held domestically. Upon access, funds earned before this date will incur a tax rate of 8% for earnings accessed before December 31.

Note that this is the crypto profit derived by trading on foreign exchanges. This rule isn’t applicable to expats leaving in Brazil with no residency status.