Since its inception, Law no. 13.254/2016,1 which
establishes the legal provisions of the so-called Brazilian amnesty
program (Regime Especial de Regularização Cambial
e Tributária [RERCT]) for undeclared foreign assets,
has generated many questions and some controversy. One of the main
issues still not clearly addressed by the regulators is the
treatment of trusts.
The law establishes the legal provisions for the voluntary
declaration and regularization of unreported assets of lawful
origin held abroad on or before December 31, 2014, by Brazilian
residents or persons domiciled in Brazil. Taxpayers who wish to
participate in the program need to file a regularization
declaration (Declaração de
Regularização Cambial e Tributária
[DERCAT]) with the Brazilian IRS (Receita Federal
Brasileira) and pay (i) income tax at a rate of 15% and (ii) a
fine in an amount equal to 100% of the income tax due. An
additional requirement is the amendment of the taxpayer's
annual tax
