UK and Brazil sign new double taxation agreement
06 December 2022
On 29 November 2022, significant progress in bilateral trade between the UK and Brazil happened as they signed a Double Taxation Agreement (DTA). The Agreement will provide relief from the double taxation of income in both countries. Before the signing of the DTA, Brazil was one of the only major trading partners of the United Kingdom that had not yet established an agreement to avoid double taxation.
Double taxation induces a hardship on taxpayers and discourages cross-border investment, making it more expensive. This can be burdensome for both businesses and individuals.
The main advantages of the agreement will be to:
- provide tax certainty and predictability to business, facilitating long-term investments
- help tackle tax evasion by providing for the exchange of information between the two countries
- intensify trade and investment between Brazil and the United Kingdom, strengthening the bilateral relationship.
The new DTA agreed will ensure UK and Brazilian businesses encounter fewer economic and administrative burdens. As a result of this, the government anticipates that the Brazilian market will become more attractive and will also facilitate Brazilian investment in the UK contributing to job creation, innovation, and prosperity.
You can check which other countries with which the UK has double taxation treaties on the HM Revenue and Customs (HMRC) guidance page. The treaty with Brazil has not yet entered into force, once completed this will be added to the documentation.
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