Brazilian tax legislation provides special exemptions from income tax on retirement and pension earnings. Retirees aged 65 and above are entitled to an additional exemption, while those with serious illnesses (as per Law 7.713/88) are fully exempt from tax on these earnings.
The Federal Revenue Service establishes specific tax benefits to protect the income of insured and pensioned elderly or disabled individuals with serious health conditions:
Retirees and pensioners aged 65 or older are entitled to an additional monthly exemption of **$ 1,903.98** on retirement and pension earnings (valid from the month they reach the age). This exempt amount is added to the standard exemption bracket of the current IRPF table.
Individuals with specific diseases (such as severe heart disease, malignant neoplasia, Parkinson's disease, multiple sclerosis, severe nephropathy, among others) are **100% exempt** from income tax on retirement, reform, or pension earnings. To obtain the exemption, an official medical certificate issued by a medical service of the Union, States, Federal District, or Municipalities is required.
No. The jurisprudence of the Federal Revenue Service and the courts restricts the exemption for serious illness exclusively to retirement, reform, and pension earnings. Earnings from active work (salaries, pro-labore), rents, or capital gains continue to be taxed normally.
The beneficiary must schedule a medical examination at the paying agency of their benefit (such as social security (INSS) or human resources department of the public service), accompanied by exams, medical reports, and biopsies that prove the disease and the date of diagnosis. Once approved, the tax ceases to be withheld at source, and the contributor can request a refund of the amounts paid retroactively from the date of diagnosis of the illness (limited to 5 years).