Income Tax: see the deductions that increase the refund

Declaring health, education and other expenses allowed in the 2022 Income Tax increases the amount of the refund to be received or decreases the tax to be paid. In the simplified declaration, the maximum limit to be deducted is R$ 16,754.34. The declaration can be delivered until 11:59 pm on April 29, and the program to complete and send the IR is available on the Federal Revenue website.

In full format, expenses that generate reimbursement include expenses with dependents, formal education, health, alimony, private pension, donations to philanthropic institutions and, for self-employed, contributions to the INSS and expenses with Cash Book.

According to the senior manager of the tax area at EY consultancy, Felipe Coelho, care must be taken when proving declared expenses and detailing expenses with invoices, receipts or bank vouchers. This is, according to Coelho, one of the main reasons that lead contributors to fine mesh.

Large variations in the volume of expenditures of the declarant between one year and another can also make him fall in the revision of the Revenue, says Coelho. In this case, you will need to justify the change and prove the expenses.

Each expense category has different rules for the deduction. There are those that have a limit, as in the case of education and expenses with dependents, or there are unlimited deductions, as is the case with health expenses.

Dependents

The deduction is BRL 2,275.08 per dependent. Children, stepchildren, parents, in-laws, siblings and same-sex partners can be included, but there are specific rules. Children must appear as dependents exclusively on the declaration of one of the parents, if it is not carried out jointly by the couple.

The parents of the declarant can only enter as dependents if they have received income, taxable or not, of up to BRL 22,847.76 throughout 2021.

Health

There is no deduction limit for medical expenses, but for this very reason, the IRS analyzes health expenses with special care to avoid fraud. A common mistake made by taxpayers, according to Coelho, is forgetting or omitting the amounts reimbursed by health plans.

It is necessary to specify how much was returned to the plan holder, says the expert. The deduction will be applied on unrefunded amounts.

In 2022, tests for Covid-19 carried out in laboratories and hospitals can also be deducted (see how), but the measure does not apply to tests carried out in pharmacies or self-tests.

education

Instruction expenses generate a deduction of R$ 3,561.50 per dependent and may include the declarant, explains Valdir Amorim, IOB’s legal and tax technical coordinator. A father who does a postgraduate course and pays for his son’s school, for example, can deduct double the amount, R$ 7,123.

But the deductions are only valid for expenses with formal education, such as colleges, technical courses and colleges. Language courses and private lessons, for example, cannot be deducted.

Alimony

Pension determined by the Court or in a notary-approved agreement paid to a child or ex-spouse can be deducted from the IR. Pensions paid voluntarily or after verbal agreement cannot be deducted. The person who receives the amount enters the declaration as “feeding” the taxpayer and what was paid can be deducted in full.

Alimony cannot be included as dependents on the same statement, except in the year in which the parents separated.

Private and official pension

Contributions to Social Security made by the self-employed person can be deducted in their total amount, without limit.

Private pension expenses of the PGBL (Free Benefit Generating Plan) or Fapi (Individual Program Retirement Fund) type can be deducted up to 12% of taxable income in the declared year.

If the taxable income is BRL 100,000, for example, it is possible to deduct up to BRL 12,000 with private pension.

self-employed

Self-employed workers can deduct the monthly contribution paid to the INSS and the expenses recorded in the Cash Book, consisting of expenses arising from the exercise of the activity.

REFUND PAYMENT CALENDAR