Heir Living Abroad: How ITCMD, Fund Remittances, and Tax Rules Work When Inheritance Crosses Borders
“When the family is on the other side of the world, the inheritance does not travel by plane. It travels through a legal process that very few people know.”
It is an increasingly common situation in Brazilian families.
The parents stayed in Brazil. The children left — for the United States, Portugal, Germany, Canada.
When the parents pass away, the heirs need to receive their share of the estate from a distance. But how does this process work from a legal and tax perspective?
💰 ITCMD: A Tax Obligation That Does Not Emigrate
Brazil's inheritance and donation tax applies to all inheritance on Brazilian territory — regardless of where the heir lives.
| Question | Answer |
|---|---|
| Does a foreign-resident heir pay ITCMD? | Yes, on Brazilian assets |
| How can they pay? | Through a representative (proxy), via Brazilian notary |
| Does non-payment block the process? | Yes — asset transfer cannot occur without settlement |
| Can the rate increase? | Yes — currently up to 4% in SP, subject to legislative changes |
🌍 The Double Taxation Issue
In some cases, the country where the heir lives also taxes the inherited assets:
🇺🇸 United States: Federal Estate Tax may apply to inheritances received by U.S. residents above certain thresholds.
🇵🇹 Portugal: Stamp duty may apply to inherited assets from foreign sources in certain situations.
🇩🇪 Germany / 🇫🇷 France: each country has its own rules for taxing international inheritances.
Brazil has few double taxation treaties in succession matters — the analysis must be done case by case, country by country.
📤 How Are Funds Sent From Brazil to Another Country?
The remittance of inheritance funds is not unrestricted. It requires:
✅ Completed Brazilian probate, with the public deed or formal distribution document ✅ Proof of ITCMD payment ✅ Full documentation of heirs ✅ Transfer via a Central Bank-authorized financial institution ✅ Correct classification of the remittance nature: "inheritance transfer"
Sending informally or without proper classification: risk of tax assessment in Brazil and blocked remittance.
Andrade & Cintra Advocacia, together with Sintra Legal & Partners, handles this entire process — from opening the probate to the legal remittance of funds to the heir abroad.
👉 Ensure the inheritance arrives correctly: andradecintra.com.br
