PERU Law and Practice Contributed by: Percy Castle, Violeta Moncada, Angel Quispe and Dayana Evangelista, Casahierro Abogados
Casahierro Abogados 501 Rivera Navarrete Ave., 14th Floor San Isidro, Lima Peru Tel: +51 122 2559 Email: casahierro@casahierro.pe Web: www.casahierro.pe
1. Tax 1.1 Tax Regimes Peruvian Tax Regime
(i) Interest: 4.99%; applicable only on interest paid by a Peruvian non-related company where no tax haven is involved and only to a specific cap rate; any other case or any excess to such cap will be subject to 30%. (ii) Dividends: 5%. (iii) Capital gains derived from securities sales in the Peruvian stock exchange: 5%. (iv) Lease of real estate properties and mov - able goods: 5%. (v) Capital gain derived from the sale of se - curities outside the Peruvian stock ex - change: 30%. (vi) Royalties: 30%. (vii) Other capital incomes not mentioned above: 30%. (b) Foreign source income and capital gains are not taxed in Peru. Inheritance and Donations to Individuals Unsettled estates constitute a separate taxpayer category subject to Income Tax. Consequently, all income and capital gains generated by the deceased’s assets within the estate must be reported utilising the deceased’s Tax Identification Number (RUC) until such time as the beneficiaries are legally designated via a declaration heirs. There is no inheritance or wealth taxes in Peru, but real estate is subject to a tax levied by the local govern - ment based on the value of urban and rural properties, with progressive rates, between 0.2% and 1%.
In Peru, individuals who are Peruvian tax residents are subject to tax on their income of both domestic and foreign sources. Non-residents are subject to tax only on their domestic source of income. The income tax treatment is as follows. • In the case of Peruvian tax resident individuals: (a) Income and capital gain related to the invest - ment and utilisation of domestic source assets (ie, interest, dividends, lease of real estate properties and movable goods, capital gains, royalties) are levied with a flat tax rate equiva - lent to 5%. (b) Income and capital gains related to the invest - ment and utilisation of foreign source assets (ie, dividends, interest, and capital gains from other jurisdictions) are levied with cumulative and progressive tax rates equivalent to 8%, 14%, 17%, 20%, and 30%, depending on the income tax bracket and/or capital gain ob - tained within the fiscal year. (c) Individual business income will be taxable as any Peruvian corporate income; therefore, it will be subject to the 29.5% corporate tax over the net income plus a 5% dividends tax in the event of any liquid distribution. • Non-Peruvian tax resident individuals: (a) Income and capital gain related to the invest - ment and utilisation of domestic source assets:
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