PERU Trends and Developments Contributed by: German Carrera, Juliana Llosa, Yesica del Carpio and Moritz Abramovitz, CPB Abogados
It is important to note that the automatic exchange of information does not replace traditional mechanisms of administrative cooperation between countries. Rather, it coexists with other forms of information exchange established under tax treaties and other international agreements entered into by Peru, which allow tax authorities to submit specific information requests when necessary for the performance of their functions. From a practical perspective, the implementation of these mechanisms broadens the information available to the tax administration and facilitates the compari - son of information obtained from foreign jurisdictions with that reported by taxpayers in Peru. BEPS and tax treaties : the multilateral front Last year, Peru ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). This instrument enables the co-ordinated incorporation of certain BEPS-related measures into tax treaties entered into by jurisdictions that are party to the MLI, without the need to renegotiate each treaty individually. In Peru’s case, ratification of the MLI will allow for the inclusion of provisions aimed, among other things, at preventing the improper use of tax treaties through anti-abuse rules such as the Principal Purpose Test (PPT) and enhancing dispute resolution mechanisms. The ratification of the MLI complements other meas - ures that Peru has progressively adopted as part of the implementation of the international standards developed under the BEPS framework. These include the obligations to file the Local File, Master File, and Country-by-Country Report (CbCR), which strength - ens transfer pricing documentation requirements and provide the tax administration with greater visibility into transactions conducted between related parties. Furthermore, in September 2024, Legislative Decree No. 1662 introduced the possibility for bilateral Advance Pricing Agreements (APAs) to have retroac - tive effect (roll-back), thereby complying with the mini - mum standard established under BEPS Action 14. The roll-back mechanism may apply to prior taxable years, provided that the relevant facts and circumstances
remain unchanged from those covered by the APA and that the tax administration is not time-barred from assessing the corresponding tax obligations. Practical Implications The gradual implementation of the various tax trans - parency mechanisms has significantly increased both the quantity and quality of information available to the tax administration. As a result, information obtained through beneficial ownership disclosures, automatic exchange of information, and other tax transparen - cy initiatives can be analysed collectively during tax audits. 4. Greater international mobility of families and investments. The increasing international mobility of Peruvian fami - lies has become one of the principal forces shaping the evolution of private wealth and succession plan - ning. While previous generations generally accumu - lated, managed and transferred wealth within Peru, many high-net-worth families today have family mem - bers, businesses and investments spread across mul - tiple jurisdictions. Several factors have contributed to this transfor - mation. Globalisation, access to foreign investment opportunities and international educational and pro - fessional mobility have encouraged younger gen - erations to establish personal and professional lives abroad. It is now common for parents to remain in Peru while children reside in the United States, Europe or other regions. At the same time, many families have diversified their wealth internationally through foreign real estate, financial assets and business investments. Political uncertainty in Peru during the last decade also prompted some families to relocate abroad and restructure part of their wealth outside the country. More recently, however, as political conditions have stabilised and a new government has taken office, some of these families have begun returning to Peru. As a result, mobility is no longer only outward; advis - ers are increasingly assisting families that are re- establishing their presence in Peru, bringing with them foreign assets, foreign structures and family members with international tax and succession considerations.
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