Software download and taxes

This is an excerpt from a conversation with a reader. 

Hi.  

I read your blog about selling software into end users in Brazil which 
was very good.   One question though.  How does the import of download 
software get declared and who is responsible for this.  I would assume the 
end user?    

Thank you

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Dear Reader,

Thanks for following the blog. 

When there is withholding tax, the person who must pay for it is technically the exporter who resides abroad (you). But, in more practical terms, the duty to collect the tax will be shared between the importer and the bank that is conducting the transaction. 

In many cases, individual software licensing transactions made via credit card to individuals end up not paying taxes. The government does not control them very well yet.

However, if you are selling via credit card to a large number of clients, the financial intermediaries will probably want to make sure that taxes are being collected. 

In this case, you must show them that the end users are paying, or take up the responsibility for tax collection yourself. 

Please let me know more about your plans for Brazil. 

Regards, 

Adler