Brazil NRIs · Dividend Tax

Dividend tax on Indian shares for NRIs in Brazil

Dividends from Indian companies are withheld at the non-resident rate before they reach you in Brazil. Here's the treaty position and how to reclaim any excess.

When an Indian company pays you a dividend while you live in Brazil, the company withholds tax at source before the money reaches you. India's default withholding on non-resident dividends is 20% under Section 393(2), the successor to Section 195. The India-Brazil treaty position is more favourable, capping the rate at 15% for individual residents, a real saving over the 20% default (Article 10). To claim it you need Form 41, the successor to Form 10F, and a Tax Residency Certificate on file with the company or your broker.

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India-Brazil key facts: dividend tax

Default non-resident TDS rate	20%
India-Brazil DTAA treaty rate	15%
Your saving via the treaty	5%
Treaty article / basis	Article 10: 15% general treaty cap (10% only for a company holding at least 20% for 365 days)
Your TRC issuing authority	the Receita Federal do Brasil (RFB)

Rates reflect India's domestic withholding under Section 393(2) (Section 195 until 31 March 2026) and the India-Brazil treaty. Surcharge and cess apply on top where relevant.

How it works on the India side

Since the 2020 shift back to classical dividend taxation, dividends from Indian companies are taxable in the shareholder's hands and the company deducts TDS before paying. For a non-resident the default is 20% under Section 393(2) (Section 195 until 31 March 2026), plus surcharge and cess, and Section 115A taxes those dividends at 20% of the gross amount with no expenses allowed. A lower rate only ever comes from a treaty, and only where that treaty writes one for individuals: several of India's treaties reserve the reduced dividend rate for companies holding a large stake in the Indian payer, and some countries have no treaty with India at all, so portfolio investors there stay at the domestic rate.

Where a lower individual rate does apply, you claim it with Form 41 (formerly Form 10F) and a Tax Residency Certificate lodged with the company or broker, and any dividend withheld at the higher rate before your paperwork was on file is reclaimed through your Indian return. Where no lower rate applies, the 20% is generally your final Indian tax, so the questions worth asking are whether the payer withheld more than the correct rate and surcharge, and whether the country you live in gives you a credit for that Indian tax.

What changes because you live in Brazil

Brazil runs your Indian income on two clocks, and one of them bills you every month. Rent from your Indian flat, and the gain when you sell it, sit outside the offshore financial regime, so you work the Brazilian tax out yourself and pay a DARF by the last working day of the month after the money reaches you. Rent goes through carnê-leão on the ordinary monthly table, topping out at 27.5%. Nobody invoices you, and paying late costs 0.33% a day up to 20%, plus Selic on top. Indian interest, dividends and gains on Indian shares and funds go the other way. Since Lei 14.754/2023 they're settled once a year in the Declaração de Ajuste Anual at a flat 15%, with nothing deductible from that base, and Indian tax you can't use against it that year won't move to another one.

Frequently asked questions

Common questions from Brazil NRIs

India's default is 20% under Section 393(2), but the India-Brazil treaty caps it at 15% for individual residents, a saving of 5%. To get the lower rate you file Form 41 with a Tax Residency Certificate from the Receita Federal do Brasil (RFB). Any excess withheld beforehand is reclaimed on your Indian return.

Yes. With Form 41 and a Tax Residency Certificate on file, the treaty rate of 15% applies instead of the 20% default, a 5% reduction. Dividends withheld at the higher rate before your paperwork was lodged are reclaimed when you file your Indian return.

Go further

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Dividend Tax sorted, by an Indian CA who works with Brazil NRIs

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