As readers may recall in June 2015 United States and Brazil agreed and signed the Social Security Totalization Agreement. Recently the Brazilian President ratified the agreement and now the agreement has come in to effect on October 1, 2018.
The agreement would be welcome news for the expatriates working in both countries as they will not be subject to pay social security taxes in both countries on the same income. Like in other totalization agreements, the assignment should not exceed 5 years. Additionally, similar to other totalization agreements, the expatriate individual is required to obtain “certificate of coverage” from the other country where he makes the social security contributions.
Another benefit of the totalization agreement is the individuals will be able to combine the periods of coverage to meet the minimum period of coverage requirements in order to qualify for the social security benefits in the home country.
CPA Global Tax & Accounting will be happy to assist with any questions.