Payments to foreign suppliers are subject to a 30% IR rate. Experts point out that the administration is expanding the scope of what is established in the standard.
Payments made to people residing abroad so that they transmit their knowhow to a company are considered as royalties, subject to an income tax rate of 30%. Recently, Sunat has adopted a position that would broaden the scope of this criterion, which could end up generating more costs for companies.
According to Carlos Moreano, partner of the PPU study, Sunat is classifying any operation in which knowledge is transmitted by a person abroad as subject to the payment of Income Tax for royalties, when this should not be the case.
The criteria of the Sunat
Giorgio Balza, a partner at the Cuatrecasas studio, points out that other benefits may be included in knowhow transmission contracts, unrelated to the act of transferring information itself.
However, despite being differentiated acts one from the other, the Sunat is, wrongly, considering that the payment related to these benefits is a royalty also for the simple fact of being in the same contract.
In other words, the Sunat is indicating that the payment for services other than the transfer of knowhow would also be royalties if they are found in the same contract.
According to Moreano, the payment of an additional tax only applies to cases in which the provider carries out a “mere transmission of information”. It would not apply if the provider also performs additional services.
Balza, however, indicates that the norm establishes that, in cases in which the benefits included in the contract are intrinsically linked to each other, if the obligations of the contract are incorporated within the concept of royalty, subject to a payment of the tax on the rent of 30%. “The controversial cases are those where the service can be divided and, nevertheless, the Sunat decides not to do it,” he explains.
However, if the payment is considered a royalty, it should be paid by the person the company contracts with, not the company.
As Balza explains, in a large number of contracts the companies assume the eventual cost of the taxes to be paid as an extra cost in the operation. In this sense, imposing a 30% payment as a tribute for the operation would make these contracts significantly more expensive.
Moreano stresses that, in a recent case analyzed by Sunat, “a provider provided legal and financial services (the payment of which would qualify as royalties), but also provided services that sought the sustainability of the company’s income and good corporate governance. as well as environmental issues.
Despite the fact that the provider carried out all these tasks, the Sunat stressed that the payment for all these services should be considered as royalties.
In this case, Moreano comments that “the administration limited itself to verifying that there was an alleged transmission of knowledge, not realizing that it did not end there, but that the person hired also provided other services.”