Retirees over 65 are exempt from the IR; know how it works

Retirees from the INSS (National Institute of Social Service) and from state, municipal and federal district regimes are entitled to a special income tax exemption from the month in which they turn 65.

The extra installment of exemption corresponds to a discount of R$ 1,903.98 on the taxable income that the insured receives from the INSS or other schemes per month. The rule applies to benefits paid by official pensions. Private pension and salary do not have the same discount.

In the year, retirees aged 65 and over can deduct an extra R$ 24,751.74 from their income tax, which corresponds to 12 installments of R$ 1,903.98 plus the 13th salary. Anything that exceeds this total amount pays Income Tax.

In practice, it is as if this insured person were entitled to double the monthly exemption from the IR. This is because, according to the tax table, only those who receive taxable amounts from R$ 1,903.98 per month pay tax. In the case of the beneficiary of the age exemption, there is also the right to add another R$ 1,903.98 per month. With this, the IR is only calculated on the amount that exceeds BRL 3,807.96 per month.

Valdir Amorim, IOB’s tax coordinator, says that when it comes to the right to double the exemption, it does not mean that retirees over 65 years of age can receive the age exemption twice. “Double means that there is a deduction from the table’s calculation basis plus the retiree’s exemption limit.”

According to the expert, you have to be very careful, because the error can lead to fine mesh. The portion that exceeds R$ 24,751.74 is taxable and pays tax.

Where to enter the values ​​in the declaration

The portion exempt from retirement or pension must be declared in the form “Exempt and Non-Taxable Income”, in line “10 – Portion exempt from retirement benefits, remunerated reserve, retirement and pension of declarant aged 65 years or older”.

It is necessary to inform the type of beneficiary, if it is the holder of the declaration or the dependent, the CNPJ and the name of the paying source, the total amount received in the year and the 13th. Whoever was 65 years old since January 2021 declares, in value, the total of R$ 22,847.76, plus the 13th of R$ 1,903.98.

The amount that exceeds the total allowed in the year goes under “Taxable Income Received from PJ”. In order not to make any mistakes, Amorim recommends following the information contained in the INSS income report.

Another expert tip is to make a pre-filled Income Tax return, available to those who have a silver or gold account at gov.br. However, you need to check that the information is correct. “The responsibility for accepting what the Revenue is showing is yours. It is up to the declarant to make the decision to use those values ​​or not”, says Amorim.

Retired cannot forget other funds

There are those who confuse the extra exemption of the IR for the retiree who is 65 years old with other benefits from the Revenue, such as the total exemption from the Income Tax for retirees due to serious illnesses. In this case, only the diseases listed by law give this right.

In addition, all other income received must be declared. Those who have assets also need to inform them in the declaration and those who have consigned credit must put the information in the “Real Debts and Onus”.

Who needs to declare the IR in 2022:

• Workers, retirees and public servants who received taxable income of more than BRL 28,559.70 in 2021
• Who received exempt, non-taxable or taxed exclusively at source income above R$ 40 thousand in 2021, which includes the FGTS (Fundo de Garantia do Tempo de Serviço) and unemployment insurance, for example
• Who had, on 12/31/2021, assets and rights of more than BRL 300 thousand
• The taxpayer who carried out an operation on the Stock Exchange in 2021
• Who moved to Brazil and was here on 12/31/2021
• The taxpayer who opted for the IR exemption on capital gain (profit) on the sale of residential property whose value was applied to the purchase of another property in the country, within a period of up to 180 days from the sale
• Who had gross income from rural activities of more than BRL 142,798.50 or wants to compensate for losses in this area