Can a Foreigner Rent Out Property in Brazil?

Legal and Tax Insights on Rental Investments

By Iure Pontes Vieira, Brazilian Real Estate Lawyer for Foreign Investors

Introduction

Brazil is becoming an increasingly attractive destination for foreign investors looking for both capital appreciation and rental income. With its vibrant tourism market, favorable property prices, and high rental demand in urban and coastal regions, Brazil offers significant opportunities — especially in short-term vacation rentals (Airbnb, Booking.com, etc.).

But what are the legal and tax implications of renting out property as a foreigner in Brazil?Can a non-resident legally rent out property?What are the risks, contract types, and tax rules?

As a Brazilian attorney with over 20 years of experience advising international clients, I’ll walk you through everything you need to know to invest safely and profitably in Brazilian rental property.

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1. Can a Foreigner Legally Rent Out Property in Brazil?

Yes. Brazilian law allows both residents and non-residents to rent out property they own, with no nationality restrictions.You don’t need to live in Brazil to own and rent a property — as long as you comply with Brazilian civil and tax laws.

Foreigners can legally:

• Rent out residential apartments or houses

• Operate short-term vacation rentals

• Lease commercial spaces to Brazilian businesses

There are no restrictions on nationality, but proper legal contracts, tax registration, and compliance are essential.

2. What Types of Rental Agreements Exist in Brazil?

The Brazilian Civil Code and specific rental laws regulate various types of leases. Here are the three most common categories:

a) Long-Term Residential Lease

• Governed by Law 8.245/91 (Lei do Inquilinato)

• Standard lease term: 30 months (2.5 years)

• Allows for automatic renewal, early termination with penalties, and legal guarantees

Common guarantees:

• Security deposit (up to 3 months’ rent)

• Personal guarantor (Brazilian resident)

• Rental insurance policy (seguro-fiança)

Legal Tip from Iure Pontes Vieira:

"Even basic leases should include clear clauses on rent increases, maintenance, penalties, and eviction procedures. Using a legally vetted contract is crucial to protect your rights."

b) Short-Term Rental (Vacation Use)

• For rentals up to 90 days, typically via platforms like Airbnb or Booking

• Written contracts are mandatory, even if the rental is digital

• Landlords must comply with local laws and building rules

Important Warning Before You Buy an Apartment for Airbnb:

📌 In Brazil, some condominium buildings explicitly prohibit short-term rentals in their bylaws (convenção de condomínio).Even if federal law allows it, the building’s internal rules can legally block it.

Before buying an apartment with short-term rental intentions, make sure to:

• Review the condominium bylaws

• Ask for minutes of the latest meetings

• Verify if the building enforces restrictions

Advice from Iure Pontes Vieira:

“Many foreign clients buy apartments thinking they’ll do Airbnb, only to find out after closing that the building prohibits it. This can completely derail your investment strategy.”

c) Commercial Lease

• For properties leased to companies or professionals

• Often long-term (5+ years), with complex legal provisions

• Includes rules for renewal, penalties, and tenant improvements

Commercial leases must be drafted or reviewed by a legal professional, especially when the landlord is abroad.

3. How Are Rental Earnings Taxed in Brazil?

Rental income is taxable in Brazil, even for non-residents. The tax treatment depends on your fiscal residency status.

a) If You Are a Non-Resident (Living Abroad):

• 15% withholding tax on gross rent received

• No deductions (maintenance, taxes, fees are not deductible)

• Tax must be paid via DARF (Brazilian tax document), monthly

Example: If you earn R$5,000 in monthly rent, you must pay R$750 in tax.

b) If You Are a Tax Resident in Brazil:

• Taxed at progressive rates (0% to 27.5%)

• Deductions allowed: property tax (IPTU), condo fees, repairs, insurance

• Monthly declaration via Carnê-Leão and annual income tax return (IRPF)

c) Other Considerations:

• You must obtain a CPF (Brazilian taxpayer ID number) to receive rental income

• Your income must be reported in your home country (e.g., US, UK, EU)

• Tax treaties may apply to avoid double taxation

4. Common Mistakes to Avoid

Over the years, I’ve helped numerous foreign clients recover from costly mistakes. These are the most common:

❌ Using informal or poorly drafted contracts

Unenforceable in court, putting your property at risk

❌ Ignoring the building’s bylaws

Short-term rentals may be legally prohibited by the condo rules

❌ Failing to report rental income

This can block money transfers abroad and trigger fines or audits

❌ Lacking a local legal representative

Makes it hard to manage disputes, evictions, or tenant defaults from abroad

5. Why Brazil Is Still a Strong Investment Opportunity

Despite legal and tax obligations, Brazil offers real advantages for rental investors:

• 💰 Rental yields often exceed 6%–8% net in key locations

• 🌴 Year-round demand from domestic and international tourists

• 📈 Long-term appreciation potential

• 🌐 Portfolio diversification into a growing emerging market

Whether you rent to locals or tourists, demand is strong — especially in São Paulo, Rio de Janeiro, Bahia, and the Northeast coast.

I am a licensed Brazilian attorney with over 20 years of experience in real estate, tax, and international law. We work with foreign clients investing in Brazil.

What we offer:

• ✅ Full legal due diligence before property purchase

• ✅ Drafting and review of rental agreements (residential, seasonal, commercial)

• ✅ Tax strategy and compliance in Brazil

• ✅ Ongoing support in English, French or Portuguese

• ✅ Representation for non-residents investing remotely

  
  

Thinking of Renting Out Property in Brazil?

Get professional legal advice before you buy or rent out your property.Work with Iure Pontes Vieira, Brazilian real estate lawyer for international investors.

👉 Visit: www.pontesvieiraadvogados.com.br

📧 iurevieira@pontesvieiraadvogados.com.br

📍 São Paulo-based. Remote legal support worldwide.