How Rental Income from a Studio Is Taxed in Brazil in 2026
Taxes are usually the last thing investors look at, but they directly affect net yield. And 2026 brought important changes. Here is the overview for Brazilian tax residents, with a note for those living abroad.
Non-residents follow different rules (15% withheld at source on rent).
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Brazilian residents: the Carnê-Leão
Residents who receive rent from another individual must pay the tax every month through the Carnê-Leão, by the last business day of the following month. The tax follows the progressive table, with rates of up to 27.5%, adding rent to other income for the month. If the tenant is a company, it withholds the tax at source.
New in 2026: exemption up to R$ 5,000
Law 15,270/2025 created, from January 2026, a reduction that brings the tax to zero for those with total taxable income of up to R$ 5,000 a month, with a gradual discount up to R$ 7,350. Note: it counts all income combined (salary, rent and so on), not just rent. For owners of one studio with moderate income, the tax can drop a lot or disappear.
What can be deducted
When paid by the owner, these can be deducted from rent before calculating the tax:
- IPTU property tax
- Condo fees
- The agency's management fee or commission
Individual vs. company
| Criteria | Individual | Company (holding) |
|---|---|---|
| Payment | Monthly Carnê-Leão | Depends on the company's regime |
| Rate | Progressive table (up to 27.5%) | Varies by regime |
| Taking out profits | Not applicable | Dividends above R$ 50,000/month with 10% withholding since 2026 |
| Complexity | Simple for a few properties | Requires accounting |
| Best for | 1 to a few properties | Larger portfolios |
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Airbnb and the tax reform
For individuals, short-term rental income follows the same logic as rent. Brazil's consumption tax reform (Complementary Law 214/2025) creates the IBS and CBS taxes, which will apply to rentals from 2027. For individuals, it only applies to those with more than three rented properties and rental income above R$ 240,000 a year. Owners of one or two studios are, in most cases, not affected.
Capital gains on sale
When selling at a profit, capital gains tax is due: 15% on profits up to R$ 5 million, rising by brackets to 22.5%. It is paid by the last business day of the month after the sale. For residents, there are important exemptions:
- Sale of your only property for up to R$ 440,000, if there was no other sale in the last 5 years
- Using the money to buy another residential property within 180 days
- Reduction factors for properties bought long ago
Taxes are not the most exciting topic, but they are among those that affect net yield most, and that change most often. In 2026, the R$ 5,000 exemption changed the math for many owners of one or two properties. Bring in an accountant from the start, not after the property is already rented.
This article provides general information and does not replace accounting or tax advice. Rates, brackets and rules can change: always consult an accountant for your case.
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- Your income and asset profile
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Frequently asked questions
Do I pay tax on rent received in Brazil?
Yes. Brazilian tax residents who receive rent from individuals pay monthly through the Carnê-Leão system, on a progressive table. Since 2026, those with total taxable income of up to R$ 5,000 a month are exempt, with a gradual reduction up to R$ 7,350 (Law 15,270/2025). Non-residents pay a flat 15% withheld at source.
Can I deduct condo fees and IPTU from rent?
Yes, when the owner pays them: IPTU property tax, condo fees and the agency's management fee can be deducted from rent before calculating the tax.
Is Airbnb taxed differently from long-term rent?
For individuals, short-term rental income follows the same logic as rent. Brazil's tax reform creates the IBS and CBS taxes from 2027 for those with more than three rented properties and rental income above R$ 240,000 a year.
Is it worth holding rentals through a company?
It can be for owners with several properties and high income, but since 2026 profits and dividends above R$ 50,000 a month are subject to 10% withholding. Do the math with an accountant.
About Rio Living Studios
Rio Living Studios specializes in studio apartments for real estate investment in Rio de Janeiro. We help investors and buyers find developments that match their profile, using market data, location analysis and appreciation potential.