Find out the maximum deductible amount, what documents you need and take a look at a detailed guide to make this inclusion
Time to declare Income tax it has arrived, and with it always come doubts. With that in mind, we spoke to Ricardo Jesus, accountant and partner at ABordin, part of the CorpServices group, to find out everything you need to know to have the maximum deduction for expenses with the education of children or other dependents.
The first essential information: it is necessary to do the complete model of the DIRPF (Individual Income Statement) so that education expenses have a tax effect. Additionally, there is a limit to these expenses: BRL 3,561.50 it is the maximum deduction that can be obtained per employee, who can be up to 24 years of age and attend a higher education.
Documents required for IR
“In addition to the discharge statement issued by educational institutions, it is important to keep supporting documents of the actual financial transaction, such as proof of payments and bank statements containing debts,” explains Ricardo. That is, when separating the documents for declaring income tax, ask the school, if it has not yet been submitted, tuition statement, and gather all evidence of payments made over the months.
“All documentation used to prepare the return must be kept for a period of five years from the year of the relevant tax year,” warns the accountant.
How to declare education expenses with dependents?
Ricardo Jesus teaches a short step by step:
- Training expenses must be reported on the “Payments made” form.
- select the code “01- Expenditure on education in Brazil” or the code “02- Expenses with training abroad”, depending on your case.
- Then select who the expenses refer to (tenant, dependent or food); inform the name of the institution and the CNPJ, if located in Brazil. Enter the total amount paid. Don’t worry about filling in the “Non-deductible installment/repayment amount” field (unless you receive a refund on the paid installments), as the program automatically deducts only the ceiling of BRL 3,561.50 per employee from the calculation base.
- Open courses like ballet, judo and English are not deductible.
The specialist also explains that other expenses, such as tours, extracurricular leisure activities, meals, fines and interest for late payment of installments must be declared in the “Payments made” form, under the code “99 Other”. “The most important point is that expenses with instructions in the name of food will be deductible only if made in execution of a judicial decision or agreement ratified in court or by public deed”, he concludes.
It’s worth being careful not to include the same employee on more than one statement, as the Federal Revenue does automatic crossings of recipes and expenses reported in the declarations. There’s little cure-all to avoid falling into the fine mesh, so it’s worth considering whether to hire a professional to help you with this task.
Where and until when to declare income tax?
On your computer, you need to download a program from the Federal Revenue website (). It is also possible to do it online through the e-CAC (Virtual Taxpayer Service Center), which can be accessed with the same data as gov.br, and from a mobile phone or tablet with the Meu Imposto de Renda app (iOS version and Android version ).
In 2023, the deadline for submitting applications will be 31 May.
Source: Terra
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