TransferWise is an online money transfer tool that allows you to send amounts abroad quickly, cheaply and securely. With over 4 billion pounds handled per month in international transactions around the world, the fintech has become popular because it has lower rates than traditional banks. The service is available in 59 countries and free.
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Although TransferWise has an intuitive and easy-to-use interface, operations performed in the digital environment tend to generate doubts, whether in terms of platform security or the procedure itself. Next, understand how TransferWise works, the fees charged on transactions and whether the service is reliable.
Secure TransferWise? See how the site for transferring money works Photo: Reproduo / TransferWise Brasil
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How to transfer money with TransferWise
The first step in sending funds abroad is to make a quick registration on TransferWise via website or application, which is available for Android and iPhone (iOS) phones. It is possible to create an account from an email address or log in with Google or Facebook data.
After registering, enter the amount you want to transfer and select the currency in which the money should be converted. TransferWise will show you, in this first stage, how much you will pay the fee and when your money will arrive. Then, just enter the destination bank account details. It is worth saying that the beneficiary does not need to be registered with TransferWise.
TransferWise is available for Android and iPhone phones (iOS) Photo: Divulgao / TransferWise
Finally, make the payment of the generated ticket or make a TED (Electronic Transfer Available) to the TransferWise account in Brazil. When the platform signals your payment, use the account abroad to transfer the combined amount to the destination account. You can track the status of the process via the website or app.
The final amount of a transfer depends on four factors: the exchange rate, the amount sent, the payment method chosen and the IOF (Tax on Financial Operations).
- Exchange rate: Different currencies have different quotes and regulations, so the price will be different in most cases. It is worth mentioning that TransferWise uses the commercial exchange rate, that is, the rate that banks use to transfer money between themselves.
- Amount sent: the more money you send abroad, the greater the cost of your transfer. This is because the TransferWise rate is calculated as a percentage of the amount to be converted. The exception is the rule when you send a small amount of money. In such cases, a minimum, cheaper tariff applies.
- Payment method chosen: if the user opts for bank transfer as a payment method, he will need to bear the eventual costs of issuing TED, according to the rates practiced by his bank.
- IOF rate: the IOF is a federal tax levied on credit, foreign exchange and insurance transactions. If the user sends money to himself, the rate is 1.1% of the total amount. If sending to someone else's account, the rate of 0.38%. In TransferWise, the value of the IOF is included in the total calculated since the beginning of the operation.
Income Tax and TransferWise: Should I declare remittances?
The guidelines of the Central Bank and the Federal Revenue determine that, if the international remittance is declared to cover educational expenses (exchange or attendance at congresses, seminars and lectures), it is not necessary to declare the transfer in the Income Tax.
When the purpose of the remittance is to cover the personal expenses of residents in Brazil on trips abroad, the tax is 6% of the total sent (until 12/31/2019). Personal expenses abroad are considered, for the purpose of reducing the IRRF tax rate, expenses for the traveller's maintenance, such as transportation, accommodation, cruise lines, car rental and travel insurance. In such cases, remittances are subject to the limit of R $ 10,000 per month per person.
Income Tax and TransferWise: Should I declare remittances? Photo: Pond5
Finally, in the case of a beneficiary resident or domiciled abroad, the applicable rate is 25% (twenty-five percent). It is worth mentioning that those who want to make transfers above 50 thousand reais per year must undergo a verification process. In other words, TransferWise asks for additional documents before continuing the transaction, including a PDF copy of your latest Income Tax Statement.
Yes. The company is legalized in all countries where it operates, following a strict list of rules established by regulatory agencies. TransferWise makes your shipments using local banking partners. In Brazil, fintech he acts as correspondent for the banks MS Bank and Banco Rendimento, which are authorized to operate in foreign exchange. In this way, all transfers are reported to the Central Bank, and each transaction pays the stipulated IOF, being declared Federal Revenue.
Via TransferWise and O Globo
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