Thoughts on Banks and a Update for my situation...

Builders often offer in-house financing for new construction or pre-launch sales from plans. Having said that, personally, I would never buy an uncompleted project or a newly finished building. I like 20+ year or older construction. Mortgages here are very expensive FWIW, currently around 9-14%.....

I deal with 3 banks. Depending on how much you put on deposit, as well as your monthly income, makes a significant difference in the qualifying service levels available to you as a customer. Been banking here since 2007.

Good luck.

Thanks for the info---not sure if looking at an apartment or house in future.....what 3 banks do you like?

Mickey

It's not so much which banks I like, as it is what you can get from them. For example, ITAU, one of the bigger banks has two tiers. Regular customers and ITAU Personnalite. How dies it work ? Personnalite has separate branches only for those clients, no lines, as well as a dedicated relationship manager who you deal with exclusively for everything by using Whats App, phone, or in person. As a gringo you need forms signed all the time. It's basically private banking with three fewer zero's on your account balance. Requirements are R$15.000 per month per person income and R$250.000 of investments at a minimum on deposit.

Why does that matter ? Well, I'm sure you've seen the bank lines here. Itau is the INSS pension bank, so, for the first week of every month people without online banking or an account, line up to get cash all day long for their pensions and to pay bills. It's a hell........30 in line on the street, and once you are inside another 30 sitting and waiting. Banking in Brasil for the regular people is brutal at times.

Santander also has Santander SELECT with the same criteria and services like ITAU. BDB and Caxia (the government banks) don't offer a tiered service. Having said that BDB does have high net worth private banking dept.

They're pretty close in service in either case. Really lousy or really good. Depending on where they classify you. Our daily use bank is Santander SELECT.

If you're in the top group it's better than a Canadian bank (where I'm from) and if you're in the bottom, it's worse IMHO. Now where you live also matters as to how busy they are if you are a regular client. There are also credit unions here now like SICOOB, etc. Hope that helps.

02/04/25 @easygoer1050.  As a US citizen contemplating banking in Brazil, particularly in a banking relationship that requires minimum account or investment balances, be sure to discuss your plans with your US tax advisor beforehand, with particular focus on any Foreign Bank and Financial Accounts (FBAR) reporting requirements. 

At the 30,000 foot level, you'll need to file a report for any tax year in which the aggregate value of all your foreign accounts exceeds US$10,000 at any time -- even for single day -- during that year.  This will not increase you taxes, but it requires a certain amount of upfront planning and recordkeeping since, for example, you're required to report the number of days that your average daily balance exceeded the US$10,000 limit.  It's not unusual to end up in this situation for a single year (I did) when you transfer money to buy property and it sits in your account, especially if you're doing a renovation so it gets spent down gradually.  While filing a properly prepared FBAR  report will have no negative consequences for you, the penalties for failing to file, filing incorrectly, or filing late can be serious.

In addition, certain types of tax-advantaged investments that are perfectly legal in Brazil and handled by banks are heavily regulated and taxed by the United States, so be sure to understand with your advisor where the danger areas are.

@Abthree

Your post about American financial reporting requirements is probably the only reason I'd ever state publicly "it's good to be a Canadian" as we have NONE of that nonsense at all.

Having said that, I am a non-resident for tax purposes with the CRA (our IRS) which means all I had to do was fill out a one time 5 page form and cut ALL TIES to Canada, except for a passport and leave the country. I have a CRA waiver letter saying I no longer have to file any returns, nor pay taxes to Canada. And, we can even refute citizenship a month after we start collecting our government pension, and receive it until we pass away tax free. That's my plan.

So far THANKS for all the info ...I will have to discuss this with my tax attorney----I am on a pension here in the US  (and make some side money via day trading---nothing so great that can put me in the HIGHER tier of banking it seems)...I never heard of the 10K for one day as that is important...as I dont want to incur any problems with taxes in Brazil as well....so I will let him know here as well to make the right decisions...

@Koyla-  I did see those lines at ITAU last May--took me 10 minutes to get in and then a hour wait inside...(I was then told I could NOT open an account without a CRNM..lol---but that was on my wife's niece who used to work at ITAU and thought it was ok....lol)   it kind of reminded me of an old version of DMV from years ago in New York.....(the set up)

Try SICOOB or one of the credit unions then. They never seem busy when I walk by. Don't know where you'll end up living, but now you have some ideas. Good luck !!

02/04/25 @kolyaS122HSU Yes, there is no way for an American to stop owing taxes to Uncle Sam, no matter where s/he lives or for how long, with or without a US address.  This is a distinction that we only share, the last time I checked, with such enlightened corners of the world as Eritrea and Myanmar.  Great company to be in!  Renouncing US citizenship is also quite difficult (not that I'd want to) and can be expensive; if it would leave the applicant a stateless person, it may not even be allowed.

@easygoer1050.  I bank at Banco do Brasil.  We chose it because at the time we weren't sure where we'd end up living, and BB has offices everywhere.  Also, since it's government-owned (as is Caixa, which also has offices everywhere), it's not likely to be sold or to go out of business.  My buddy, the late Advisor Texanbrazil, banked with HSBC, and got crammed into Bradesco against his will when they sold their retail business in Brazil; I don't want that.  I've been pretty satisfied with them, but I live in a different city from @kolyaS122HSU; like him I NEVER go to the bank on the first Monday of the month, for the same reason.  But with the strides that online and phone banking and cashless purchasing have made in Brazil, I rarely have to go to the bank at all.

FWIW to refute Canadian citizenship is $100 and a 3 page form. Go to a consulate and you're done as long as you can prove you have a second passport.

I understand it's like $2,500 USD for you guys to do the same. But the tax savings may be worth it overall, and then some. To each their own.

FWIW my father in law landed at Santander when Banco Real got bought out by them, and it's simply risk management to spread the money around. I find the banking apps work well, but, when you have easy access to your banker you actually end up contacting them. Beats texting a two bit AI program and getting no assistance.

For example, if you get a C/C get a Mastercard or AMEX here because they work everywhere all the time. VISA is shit. Pure unadulterated garbage. Sometimes the POS terminals don't access them. In the last two months I had my Santander VISA declined for he following......my AMEX saved the day, and my wife's MC has never had a problem. Must be the VISA software security settings.

A R$7.50 metro fare in Rio

A R$45.00 purchase on a popular app

A R$300 transaction at the Canadian Consulate, very embarrassing

A R$30 purchase at a variety store

A R$100 charge on a popular app

Called Vanda at my bank, saw her late in the same day. In 10 minutes she opened her desk drawer and pulled out a MC and I was good to go. Try and do that in the line up. I am so over AI and telephone CS lines here. The only frustration I have to be honest.

I opened a checking account at Banco do Brasil ten years ago and have gone to a physical branch only a few times since.

You can, of course, live in Brazil without a local bank. Pix requires a local bank account and is convenient at times.

I bank with Caixa simply because it is the only bank on the island. I also used to have accounts with Bradesco and Citibank, but it was a real pain driving up to an hour just for a quick bank visit, so we closed them.

Therefore it would be sensible to choose a bank that has a branch relatively close to where you will live - even if you only plan on going there occasionally.

I have a good relationship with the managers, so that I am allowed access to see them after the bank has closed when there are no crowds, and I also know when not to go on certain days!

@kolyaS122HSU

Re "I no longer have to file any returns, nor pay taxes to Canada", that's not entirely true. Any government pension or old age secuirty payments (CPP and OAS) payed to you by Canada will be subject to a 25% withholding tax by Canada if you live in Brasil and are not  a national of Brasil. In addition, any amount withdrawn from a registered retirement fund (RRSP or RRIF) will have 25% lopped off by the Canadian government, meaning you will receive only 75%. These and other conditions are clearly outlined in the Brasil-Canada tax treaty. There is the possibility of lowering those Canadian withholding taxes by filing tax returns in both Canada and Brasil while you are a resident of Brasil, and you can generally use any taxes paid in Canada to offset taxes owed in Brasil, as outlined in the treaty.

As it relates to CPP/OAS and other pensions, you need to be an non-resident expat for tax purposes, which means you formally cut ALL TIES with Canada except for a passport. Including rights to bank accounts, investments, and you must have any income direct deposited to a Brasilian bank, sell all your CAD assets, RE, etc, and relinquish rights to healthcare.

Then the CRA will issue a clearance letter from the NR73 and NR5 form submissions which you made, and which the CRA will respond to in writing with their decision.

That is what we did. It is the most severe action you take short of recanting.

If you do not do this, then they take the 25% withholding tax. We collect CPP without any withholding tax (nor will there be tax on OAS when that starts) and my wife collects a Province of Alberta LAPP pension with a reduced tax rate of 9% down from 25%. We then apply that CAD tax paid as a credit to her Brasilian tax owing on our multiple Brasilian income sources.

I no longer have to file a Canadian tax return, and she must file for 5 more years, unless she refutes her Canadian citizenship which is the plan.

We have all my aforementioned statements in writing from the CRA.

02/05/25 @easygoer1050.  These folks provide a lot of free, up-to-date information specifically (although not entirely) for US citizens contemplating an expat life:

https://creativeplanning.com/international/

I am NOT recommending (for or against) their services and do not use their paid services myself, but I do attend some of their free seminars and get their free newsletter.  The information can help you formulate probing questions to ask your own advisors.

@alan279 Totally Agree. Banco Do Brazil is my "What If" bank (like those fixed apostrophe's😍) in case someone manages to get into my main bank account or as Dave Ramsey would say my Banco Do Brazil account is my "Emergency Money"

FYI Banco Do Brazil's physical branch ATM`s are harder to maneuver than Fort Knox. Consider yourself lucky. Retirment🕵

As it relates to CPP/OAS and other pensions, you need to be an non-resident expat for tax purposes, which means you formally cut ALL TIES with Canada except for a passport. Including rights to bank accounts, investments, and you must have any income direct deposited to a Brasilian bank, sell all your CAD assets, RE, etc, and relinquish rights to healthcare. Then the CRA will issue a clearance letter from the NR73 and NR5 form submissions which you made, and which the CRA will respond to in writing with their decision.That is what we did. It is the most severe action you take short of recanting.If you do not do this, then they take the 25% withholding tax. We collect CPP without any withholding tax (nor will there be tax on OAS when that starts) and my wife collects a Province of Alberta LAPP pension with a reduced tax rate of 9% down from 25%. We then apply that CAD tax paid as a credit to her Brasilian tax owing on our multiple Brasilian income sources.I no longer have to file a Canadian tax return, and she must file for 5 more years, unless she refutes her Canadian citizenship which is the plan.We have all my aforementioned statements in writing from the CRA. - @kolyaS122HSU

You must have an extremely low worldwide income that would normally be exempt from tax in Canada. I suspect this is why your filing of the NR5 form led to a decision to remove all withholding taxes. The withholding tax decision by the CRA after filing that form is based on the worldwide income you declare and their assessment of how much tax it would incur in Canada.  That form must be re-filed every five years. Additionally, filing the NR73 as a non-resident for tax purposes, as I did 25 years ago and everyone should do on leaving Canada, does not require you to sever ALL ties with Canada. It requires you to sever enough ties that the Canada Revenue Agency is convinced that you are no longer a Canadian tax resident. You are allowed to keep investments in a registered savings plan (although not contribute), bank accounts for deposit of Canadian funds etc. The trick is to keep financial ties to a minimum in the early years of your departure to not arouse suspicion, and to confirm that you physically no longer live in Canada. And, of course, as soon as you make that declaration you no longer have to file a Canadian tax return. As for Canadian provincial health care, you lose that in any event, by being a non-resident (although in some provinces, such as Ontario, if you spend five months of the year in that province you are still eligible).

You can file an annual Canadian tax return on your worldwide income as a non-resident if it benefits you, which is one of the purposes of the  NR5 form. If you can demonstrate that your worldwide income is low enough that you wouldn't normally be taxed in Canada then you can reduce or eliminate withholding taxes on Canadian sourced pension and other income. Or if you become a Brazilian citizen (which I am), there is no longer a withholding tax on your CPP or OAS, regardless of your income level, because of tax treaty provisions. No tax return filing is necessary for that to take effect, just proof of Brazilian citizenship.

Also, after you have initially convinced the CRA that you are a non-resident you are free to conduct business in Canada, maintain investments in Canada, and even have business interests in the country. For decades I  earned all my employment (freelance) income in Canada and the U.S. and had payments deposited in bank accounts in those countries. I pay tax on my worldwide employment  income only in Brazil. About five years after becoming a resident of Brasil (I sold my house in Canada when I moved to Brasil to "sever ties") I bought a second home in Canada. This does not jeopardize my tax status, although I will owe capital gains taxes to Canada on the profit when I sell. In fact, I am on my second Canadian non-resident home, and I did pay capital gains when I sold the first one before buying another. I use that house to spend three months of the year in Canada, which also does not jeopardize my non-resident tax status. I am also now of the age where I must make minimum annual withdrawals required by law from my Canadian registered savings plan, which i was able to legally maintain in Canada as a non resident for 25 years. These are deposited in a Canadian bank account before being transferred to Brasil. I have filed an NR5 to request reduction of the 25% withholding tax, but my worldwide income tax is high enough that my Canadian accounted estimates I won't be able to reduce it by much--perhaps to 20%. However, those taxes can be used to offset my income taxes in Brazil. Unfortunately for tax purposes I have considerable investment income in Brasil and other investment income in Canada that means my NR5 request impact will be limited.

I'm rambling a bit, but my point is that filing the two forms you mention does not remove Canadian tax obligations if you are a resident of Brasil. It removes or reduces them only if your worldwide income situation is low enough that you would otherwise not be obligated to pay income tax, or would pay little income tax in Canada. This is evidenced by the fact that your wife is still paying a 9% tax on her Province of Alberta pension.

I realize this all digresses from the general topic of this discussion, but I don't want any Canadians reading this to get the wrong idea about what can or cannot be done about Canadian withholding taxes.

Every individuals situation is different, and I think we all realise that aspect of tax structuring. You didn't state anything I didn't already know, but, for the benefit of those Canucks reading this you should hire a Canadian tax lawyer regardless, as I did. Luckily for me I married into an extended Brasilian family with three lawyers, so, no retainers required on this side at least KKKKKKKK. There were a few healthy churrascaria bills which I paid however.

The great thing is, that "nuances" abound in both countries laws and reporting requirements fortunately, and it is these which must be "navigated and manipulated" for the desired outcome relative to your intentions going forward. You don't have to break any laws to do so either, nor should you.

I'm recanting my Canadian citizenship probably in spring or summer of next year at the earliest possible moment. Canada is dead to me, in fact the entire western world can KMA.

YMMV of course..........so, govern yourself accordingly......right ?