Americas Tax Facts 2017

The Americas Tax Facts 2017 A concise overview of tax systems in the Americas region

Audit / Tax / Advisory

Smart decisions. Lasting value.

Contents Argentina.......................................................................................... 4 Aruba................................................................................................ 5 Barbados.......................................................................................... 5 Belize................................................................................................ 6 Bolivia............................................................................................... 7 Brazil................................................................................................ 7 Canada............................................................................................. 8 Chile................................................................................................. 9 Colombia.......................................................................................... 9 Costa Rica.......................................................................................10 Curacao...........................................................................................11 Dominican Republic........................................................................11 Ecuador...........................................................................................12 El Salvador......................................................................................13 Guatemala.......................................................................................13 Honduras.........................................................................................14 Jamaica...........................................................................................15 Mexico.............................................................................................15 Nicaragua........................................................................................16 Panama...........................................................................................17 Paraguay.........................................................................................17 Peru.................................................................................................18 Saint Martin.....................................................................................19 United States...................................................................................19 Uruguay.......................................................................................... 20 Venezuela....................................................................................... 21

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This booklet contains a summary of essential tax information covering 26 countries in the Americas region in alphabetical order. It demonstrates our leadership skills in the region for both our partners and clients The tax information is current as of 1 January 2017. Our layout allows users to easily make comparisons between countries but the content of this booklet should not be used as a basis for action without further professional advice.

We are confident this information is useful to different economic industries. The following topics are covered in this booklet: • Currency • Official language(s) • Taxation of individuals (tax base) • Individuals Income tax rates • Specific or general expatriate tax provisions • Corporate income tax rates (standard rate)

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• Tax Residence and Permanent Establishment (PE) • Branch Profits Tax Rate (Permanent Establishments) • Branch remittance tax • Tax losses • Domestic withholding tax rate (WHT) on dividends paid • Domestic withholding tax rate (WHT) on interests paid • Domestic withholding tax rate (WHT) on royalties paid • Domestic withholding tax rate (WHT) on certain fees paid • Specific or general Transfer Pricing (TP) regulations • Specific or general Thin Capitalization (D:E) regulations • Specific or general Controlled Foreign Companies (CFC) regulations

• OECD Base Erosion and Profit Shifting (BEPS) participation • Foreign Exchange Controls applicable • US Foreign Account Tax Compliance (FATCA) applicable • OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable • Bilateral Investment Treaties (in force) • Tax Treaty Network in force

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4

Topic

Argentina

Currency

Argentine Peso (ARS)

Official language(s)

Spanish

Taxation of individuals (tax base)

Worldwide income

Individuals Income tax rates

5% - 35°%

Specific or general expatriate tax provisions

No

Corporate income tax rates (standard rate)

35%

Tax Residence and Permanent Establishment (PE)

A corporation is generally considered resident if it is incorporated in Argentina. Branches of foreign corporations and Permanent Establishments are also considered as residents.

Branch Profits Tax Rate (Permanent Establishments)

35%

Branch remittance tax

0%

Tax losses

5 years carry forward

Domestic withholding tax rate (WHT) on dividends paid

0%

Domestic withholding tax rate (WHT) on interests paid

35%

Domestic withholding tax rate (WHT) on royalties paid

6%

Domestic withholding tax rate (WHT) on certain fees paid

2% - 30%

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

No

OECD Base Erosion and Profit Shifting (BEPS) participation

Yes

Foreign Exchange Controls applicable

Yes

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

Yes

Bilateral Investment Treaties (in force)

53

Tax Treaty Network in force

Sweden, Germany, Bolivia, France, Brazil, Italy, Spain, Canada, Finland, Belgium, Denmark, Netherlands, Australia, Norway, Russia, Switzerland, Uruguay, UK & North Ireland, Chile, Mexico ( not yet protocolized )

Aruba

Barbados

Aruban Florin (AFL or AWG)

Barbados Dollar (BBD)

Dutch, English and Papiamento

English

Worldwide income

Residents - Worldwide income; Non-residents - Barbados sourced income

7% -58.95%

12.5% - 33.5%

yes

Yes

25%

25%

A corporation is considered a resident tax payer if if it is incorporated under Aruba law or it has its place of effective management in Aruba. Entities incorporated under foreign law are considered non-resident tax payer if they have income from business conducted through a fix place of business in Aruba, from real estate located in Aruba or from claims which are secured by a mortgage on such real estate.

A corporation is generally considered resident if it is managed and controlled in Barbados or if it is incorporated in Barbados. Branches of foreign corporations are also considered as residents.

25%

25%

not applicable

10%

5 years carry forward

9 years carry forward (except for residential undertakings - which are restricted to 7 years)

0%, 5% or 10%

12.5%

0%

12.5%

0%

12.5%

0%

12.5%

yes

NO

No

NO

No

NO

Not yet embedded in local law

YES. But not enacted in any legislation yet

No

YES

No IGA to implement Fatca. Aruba FI may register with the IRS and agree to report to the IRS information about their US accounts

YES

yes

YES

approx. 190 Bilateral Investment Treaties in force

9

Dutch Kingdom (Kingdom Act for the avoidance of double taxation)

UK & Northern Ireland, Canada, USA, Finland, Norway, Sweden, Switzerland, CARICOM, Venezuela, China, Cuba, Malta, Mauritius, Austria, Netherlands, Seychelles, Mexico, Luxembourg, Panama, Spain, Czech Republic, Iceland, Bahrain, Qatar, San Marino, Singapore, United Arab Emirates

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6

Topic

Belize

Currency

Belize Dollar (BZD)

Official language(s)

English

Taxation of individuals (tax base)

Income earned in Belize

Individuals Income tax rates

25%. Residents earning BZD 26,000 (USD 13,000) or less pay no income tax. In the case of all other employed residents, tax is assessed on all compensation including benefits in kind after allowance of BZD 20,000 (USD 10,000).

Specific or general expatriate tax provisions

No, except for double taxation agreement with the United Kingdom and CARICOM.

Corporate income tax rates (standard rate)

Although Belize is under a business tax regime, the law still requires the filing of an annual corporate income tax return at the end of a company’s financial year. Corporate income tax is assessed at a rate of 25%. Business Tax is assessed monthly at a rate of 1.75% on Gross Receipts for most entities. No expense deduction allowed except for interest expense in the case of banks.

Tax Residence and Permanent Establishment (PE)

Considered tax resident once income is earned in Belize.

Branch Profits Tax Rate (Permanent Establishments)

25% (see Corporate Income Tax Rates above)

Branch remittance tax

N/A

Tax losses

Approved losses are converted into a tax credit at 25% and can be relieved against 20% of the annual charge to business tax. Tax losses can be carried forward for 5 years.

Domestic withholding tax rate (WHT) on dividends paid

15%

Domestic withholding tax rate (WHT) on interests paid

15% - interest to non-residents

Domestic withholding tax rate (WHT) on royalties paid

15%

Domestic withholding tax rate (WHT) on certain fees paid

25% on management and technical fees, and rental of equipment paid to non-residents.

Specific or general Transfer Pricing (TP) regulations

No

Specific or general Thin Capitalization (D:E) regulations

No

Specific or general Controlled Foreign Companies (CFC) regulations

No

OECD Base Erosion and Profit Shifting (BEPS) participation

No

Foreign Exchange Controls applicable

Yes

US Foreign Account Tax Compliance (FATCA) applicable

Banks in Belize comply with FATCA.

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

Belize has signed on to the Organization of Economic Cooperation on Development’s (OECD) Convention on Mutual Administrative Assistance in Tax Matters. Belize also signed specific tax information exchange agreements with Australia, United Kingdom, Belgium, Netherlands, Sweden, Finland, Greenland, Norway, Iceland, Denmark, Faroes, Portugal, France, Ireland, Mexico, Poland, India, South Africa.

Bilateral Investment Treaties (in force)

Belize has a trade agreement with CARICOM. Tax and duty exemptions are available for investments in Belize that meet certain size, employment generation and foreign exchange earnings criteria.

Tax Treaty Network in force

There is a double tax treaty with the United Kingdom and with CARICOM.

Bolivia

Brazil

Bolivian Boliviano (BOB)

Brazilian Real (BRL)

Spanish and several dozen of indigenous languages

Portuguese

Bolivian Source

Worldwide Income

13%

From 0% to 27.5%

No

Yes

25% Generally 37.5 or 32.5% Mining Industry 50% Banks (Since 2017)

34% (corporate income tax, is levied on the taxable profits at a rate of 15% plus surtax of 10% exceeding BRL 240,000 on an annual basis. Additionally is due a social contribution of 9% on taxable profit)

A corporation is generally considered resident if it is incorporated in Bolivia. Branches of foreign corporations and Permanent Establishments are also considered as residents.

The characterization of a PE in Brazil is uncommon, since Brazilian tax law does not have a clear definition of PE. For this reason, in order to analyze if a legal entity can be considered as having a taxable presence in Brazil, the concept of “doing business� is more frequently used by tax authorities.

25% Generally; 37.5 or 32.5% Mining Industry; 50% Banks (as of 2017)

34%

12.5% (except DDT Spain 10% apply for the dividends)

Dividends payment are no taxable.

3 years carry forward 5 years carry forward to the extractives Company

Tax loss may be carried forward with no time limit. Loss compensation is limited to 30% of taxable income.

12.5% if the dividends are paid abroad. 10% DDT Bolivia - Spain apply to dividends if the Spain Company who have 25% of Bolivian company

Dividends payment are no taxable

12.5% if the interest are paid abroad

Interest to non resident WHT 15%; 25% payment to tax haven country)

12.5% if the royalties are paid abroad

WHT 15% (25% payment to tax haven country)

12.5% if the fees are paid abroad

Technical Services: WHT 15% (25% payment to tax haven country), plus CIDE 10%, plus PIS and COFINS 9.25%, plus ISS 5%.

Yes

Yes

No

Yes

No

Yes

No

Yes

No

No

No

Yes

No

Brazil is not an OECD member country.

Sweden, Germany, Bolivia, France, Spain, Andean Community and United Kingdom

Argentina, Austria. Belgium, Canada, Chile, China, Czech Republic, Denmark, Ecuador, Finland, France, Holland, Hungary, India, Israel, Italy, Japan, Korea, Luxembourg, Mexico, Netherlands, Norway, Peru, Philippines, Portugal, Slovakia, South Africa, Spain, Sweden, Ukraine

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Topic

Canada

Currency

Canadian Dollar (CAD)

Official language(s)

English and French

Taxation of individuals (tax base)

Worldwide income

Individuals Income tax rates

15%-33% plus provincial tax where combined rates can exceed 50%

Specific or general expatriate tax provisions

No

Corporate income tax rates (standard rate)

Ranges around 26% -31%* depending upon the province. (*Rate may vary depending on corporate activity, ownership and tax treaties)

Tax Residence and Permanent Establishment (PE)

A corporation is considered resident generally where it is incorporated or where mind and management is located. A foreign company can be subject to tax if it carries on business in Canada or has Canadian real estate holdings.

Branch Profits Tax Rate (Permanent Establishments)

Non-resident corporations carrying on business in Canada through a branch are subject to a 25%** branch tax (**Potential reductions depending on tax treaty)

Branch remittance tax

8

Tax losses

Non-Capital Losses - 20 years carry forward and 3 years carrybac Net Capital Losses - indefinite carryfoward and 3 years carryback

Domestic withholding tax rate (WHT) on dividends paid

Could be 38.33% in certain circumstances

Domestic withholding tax rate (WHT) on interests paid

0%

Domestic withholding tax rate (WHT) on royalties paid

0%

Domestic withholding tax rate (WHT) on certain fees paid

0%

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

Yes

OECD Base Erosion and Profit Shifting (BEPS) participation

Yes

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

Yes

Bilateral Investment Treaties (in force)

93

Tax Treaty Network in force

Algeria, Argentina, Armenia, Australia, Austria, Azerbaijan, Bangladesh, Barbados, Belgium, Brazil, Bulgaria, Cameroon, Chile, China, Colombia, Croatia, Cyprus, Czech Republic, Denmark, Dominican Rep, Ecuador, Egypt, Estonia, Finland, France, Gabon, Germany, Greece, Guyana, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Jamaica, Japan, Jordan, Kazakhstan, Kenya, Korea, Kuwait, Kyrgyzstan, Latvia, Lithuania, Luxembourg, Malaysia, Malta , Mexico, Moldova, Mongolia, Morocco, Netherlands, New Zealand, Nigeria, Norway, Oman, Pakistan, Papua New Guinea, Peru, Philippines, Poland, Portugal, Ivory Coast, Romania, Russia, Senegal, Serbia, Singapore, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Taiwan, Tanzania, Thailand, Trinidad and Tobago, Tunisia, Turkey, Ukraine, UAE, UK, USA, Uzbekistan, Venezuela, Vietnam, Zambia, and Zimbabwe

Chile

Colombia

Chilean Peso (CLP)

Colombian Peso (COP)

Spanish

Spanish

Worldwide income

Worldwide income

2016: 0% - 40%; As of 2017: 0% -35%

0% - 35%

Non residents/domiciled are taxed only on Chilean source income, for the first 3 years, after which are taxed on worldwide income

No

2016: 24%; 2017, 25%-25,5%; as of 2018: 25%-27%.

33% (34% for 2017 taxable year). There is also an income tax surcharge for taxable years 2017 at a 6% rate and 2018 at a 4% rate. Which will only be applicable to those taxpayers with a net taxable income equal or higher than COP 800,000,000.

Corporations incorporated in Chile are considered residents.

Branches and PE also are considered residents.

A corporation is resident if it is organized under Colombian law, it has its main domicile in Colombia or if its place of effective management is located in Colombia. The notion of Permanent Establishment (PE) includes any fixed place of business located in Colombia through which a foreign company, whether corporation or any other foreign entity or individual not resident in Colombia, performs wholly or part of its activity. The PEs are taxed only on their Colombian-source income.

2016: 24%; 2017, 25%-25,5%; as of 2018: 25%-27%.

33% (34% for 2017 taxable year). There is also an income tax surcharge for taxable years 2017 at a 6% rate and 2018 at a 4% rate. Which will only be applicable to those taxpayers with a net taxable income equal or higher than COP 800,000,000.

35%. Corporate tax may be credited against withholding tax.

From profits that were not taxed at the Branch level will be subject to a 35% withholding tax of 35% plus 5%. The profits that have been taxed at the branch level will be taxed at the Head Office level at 5%.

May be carried forward indefinitely

12 years carry forward

N/A

The dividends paid out from profits that were not taxed at the corporate level will be subject to a 35% withholding tax led by of the domestic shareholder and 35% plus 5% led by the foreign shareholder. The dividends that have been taxed at the corporate level will be taxed at the shareholder level at 5%.

N/A

33%

N/A

15%. Special rate 26.4% applies to software licensing payments.

10% on fees paid to individuals. Individuals may credit amount withheld against personal tax.

15%

General TP Regulations

Yes

Specific Thin Capitalization Regulations

Yes

Specific CFC Regulations

Yes

Yes

No

No

No

Yes

Yes

Yes

yes

48, please see: www.sice.oas.org/ctyindex/CHL/CHLBITs_s.asp

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Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Colombia, Croatia, Czech Republic, Denmark, Ecuador, England, France, Ireland, Italy, Japan, Malaysia, Mexico Norway, New Zealand, Paraguay, Peru, Poland, Portugal, Russia, Spain, Sweden, Switzerland, South Africa, South Korea, Thailand.

Chile, Spain, Switzerland, Canada, MĂŠxico, Portugal, Korea, India and Czech Republic

Please see: www.sii.cl/pagina/jurisprudencia/convenios.htm

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Topic

Costa Rica

Currency

Costa Rica Colon (CRC)

Official language(s)

Spanish

Taxation of individuals (tax base)

Territorial tax regime

Individuals Income tax rates

10-25% (0% for a certain threshold)

Specific or general expatriate tax provisions

No

Corporate income tax rates (standard rate)

10-30%

Tax Residence and Permanent Establishment (PE)

A corporation is generally considered resident if it is incorporated in Costa Rica. Branches of foreign corporations and Permanent Establishments are also considered as residents. 180 days threshold to be considered a tax resident

Branch Profits Tax Rate (Permanent Establishments)

30%

Branch remittance tax

15%

Tax losses

Only for industrial (3 years) and agro industrial companies (5)

Domestic withholding tax rate (WHT) on dividends paid

15%

Domestic withholding tax rate (WHT) on interests paid

15%

Domestic withholding tax rate (WHT) on royalties paid

25%

Domestic withholding tax rate (WHT) on certain fees paid

15%-30%

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

No

Specific or general Controlled Foreign Companies (CFC) regulations

No

OECD Base Erosion and Profit Shifting (BEPS) participation

No

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

Yes

Bilateral Investment Treaties (in force)

There are 14 bilateral investment agreements with Germany, Argentina, Canada, Chile, Taiwan, Korea, Spain, France, the Netherlands, Paraguay, the Czech Republic, Switzerland, Venezuela, Qatar and China.

Tax Treaty Network in force

Existing information exchange agreements with Argentina, Australia, Canada, France, the Netherlands, Mexico, Ecuador.

Fiscal treaties of mutual assistance with the United States, Central America (Agreement of mutual assistance and technical tax and customs cooperation of Central America No. 8880). Agreements to avoid double taxation with Spain and Germany.

10

Curacao

Dominican Republic

Netherlands Antillean Guilder (ANG or Nafl)

Dominican Peso (DOP)

Dutch, English, and Papiamento

Spanish

Worldwide income

Territorial Income

9.75%-46.50%

15%, 20% and 25%

Yes

No

22%

27%

A corporation is considered resident if it has been incorporated in Curazao or has it's place of effective management in Curazao or has real estate in Curazao or receivables covered by a mortgage

A corporation is generally considered resident if it is incorporated in Dominican Republic. Branches of foreign corporations and Permanent Establishments are also considered as residents.

22%

27%

not applicable

10%

10 years carry forward

5 years carry forward

0%

10%

0% Curacao does not levy withholding taxes on interest; In the personal income tax a 8.5% tax rate applies on domestic interest paid on bank accounts and is withheld by the banks.

10%

0%

15%, 20% and 25%

0%

1% - 27%

As per 1-1-2017 General applied OECD TP rules apply

Yes

Loans from related Tax exempt NV's or BV's may not exceed 3 times the equity of the debtor

Yes

No

No

Yes

Yes

No

No

Yes

Yes

Yes

Yes

approx. 190 Bilateral Investment Treaties in force.

3

27 TEIA's, Tax treaties with The Netherlands and Norway in force, with Malta and Cuba signed but not yet in force

Canada, USA, Spain

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11

Topic

Ecuador

Currency

US Dollar (USD)

Official language(s)

Spanish

Taxation of individuals (tax base)

Worldwide income

Individuals Income tax rates

5% - 35%

Specific or general expatriate tax provisions

Yes

Corporate income tax rates (standard rate)

22%; and 25% for companies with shareholders domiciled in tax havens.

Tax Residence and Permanent Establishment (PE)

A corporation is generally considered resident if it is incorporated in Ecuador. Branches of foreign corporations and Permanent Establishments are also considered as residents.

Branch Profits Tax Rate (Permanent Establishments)

22%

Branch remittance tax

22%

Tax losses

5 years carry forward

Domestic withholding tax rate (WHT) on dividends paid

1% - 10% for individuals, not for companies, with exception if their shareholders are domiciled in tax havens.

Domestic withholding tax rate (WHT) on interests paid

5% for residents; 22% for non-resident if the credit it is not registered in the Central Bank.

Domestic withholding tax rate (WHT) on royalties paid

2% for residents; 22% for non-residents.

Domestic withholding tax rate (WHT) on certain fees paid

8% - 10% for individuals residents; 2% for companies residents; and 22% for non-residents.

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

No, except for activities such as public services, TV and radio, financial and newspapers.

OECD Base Erosion and Profit Shifting (BEPS) participation

Yes

Foreign Exchange Controls applicable

WHT 5% to send money abroad.

US Foreign Account Tax Compliance (FATCA) applicable

No

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

No

Bilateral Investment Treaties (in force) Tax Treaty Network in force

12

Belgium, Bolivia, Brazil, Canada, Chile, China, Colombia, France, Germany, Italy, Mexico, Peru, Romania, Singapore, Spain, Switzerland, Uruguay, and South Korea.

El Salvador

Guatemala

US Dollar (USD)

Guatemalan Quetzal (GTQ)

Spanish

Spanish

25 % or 30 % income territory only El Salvador

Local income

25%-30%

7% - 25°%

No

YES

25%-30%

7% of income or 25% on profits

Tax residence is obtained by the incorporation in the national territory, also branches of foreign companies which in turn is a form of permanent establishment. The various forms of permanent establishment are also considered tax residents.

A corporation is generally considered resident if it is incorporated in Guatemala. Branches of foreign corporations and Permanent Establishments are also considered as residents.

30%

7% of income or 25% on profits

Not applicable

15% to 25%

Tax losses are not deductible from future earnings, there are only deductible losses on sale of fixed assets against future profits from sale of fixed assets, within 5 years after sale.

Not applicable

5% to dividends from 2011 onwards obtained, and 25% tax havens, states or territories with low or no taxation

5%

10% for residents, except financial institutions, 20% for nonresidents and 25% for fiscal paradises, states or territories with low or no taxation.

10%

20% for non-residents and 25% for fiscal paradises, states or territories with low or no taxation.

15%

10% for individuals, except legal persons, 20% for non-residents and 25% for fiscal paradises, states or territories with low or no taxation.

25%

Yes

Yes, only for transactions with related companies outside the country

No

NO

No

NO

No

NO

No

NO

Yes

Yes

No

NO

21 - www.sice.oas.org/ctyindex/SLV/SLVBITs_s.asp

Chile, Colombia, USA, PanamĂĄ, Central America and Mexico, Taiwan, Dominican Republic

5%

US, Association Agreement with the EU, FTA Dominican Republic, FTA Chile, FTA Panama, FTA Taiwan, CAFTA-DR (Central America, the US and Dominican Republic), FTA Colombia, CAFTA-MX, Partial Scope Agreement El Salvador-Cuba.

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13

Topic

Honduras

Currency

Lempira (HNL)

Official language(s)

Spanish

Taxation of individuals (tax base)

Territorial Income

Individuals Income tax rates

15%, 20% and 25%

Specific or general expatriate tax provisions

10 - 25%

Corporate income tax rates (standard rate)

25% + 5% or ( 0.75 - 1.5%) on gross income equal to or greater than Ten Million lempiras (L10,000,000.00) for the period when applying tax rate 25%, if less than 0.75 or 1.5% of revenues Gross declared.

Tax Residence and Permanent Establishment (PE)

A corporation is generally considered resident if it is incorporated in Honduras. Branches of foreign corporations and Permanent Establishments are also considered as residents.

Branch Profits Tax Rate (Permanent Establishments)

25%

Branch remittance tax

10%

Tax losses

Not applicable

Domestic withholding tax rate (WHT) on dividends paid

10%

Domestic withholding tax rate (WHT) on interests paid

10%

Domestic withholding tax rate (WHT) on royalties paid

10%

Domestic withholding tax rate (WHT) on certain fees paid

12.5% - 13.5%

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

No

OECD Base Erosion and Profit Shifting (BEPS) participation

No

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

No

Bilateral Investment Treaties (in force)

9

Tax Treaty Network in force

No

14

Jamaica

Mexico

Jamaican Dollar (JMD)

Mexican Peso (MXN)

English

Spanish

Worldwide income

Worldwide income

25%/ 30%

0% - 35%

No

Yes, expats are subject to 0-15%-30% tax depending on their income

25%/ 33 1/ 3%

30%

A corporation is generally considered resident if it is incorporated in Jamaica. Additionally branches/subsidiaries of foreign corporations are also considered as residents for tax purposes.

Corporations incorporated in Mexico and/or overseas companies with central management and control located in Mexico.

25%/ 33 1/3%

30%

0.00%

0%

Carried forward indefinitely. However, losses set off in each year is capped at 50% of net income.

10 years carry forward

25%/ 33 1/3%

10% only for individuals and foreign corporations

25%/ 33 1/3%

4.9% to 40%

25%/ 33 1/3%

5% to 40%

25%/ 33 1/3%

25%

Yes

Yes

No

Yes 3-1 ratio

No

No

We normally embrace OECD participations

Yes

No

No

Yes

Yes

Yes

Yes

12 Canada, China, Denmark, France, Germany, Israel, Norway, Spain, Sweden, Switzerland, United Kingdom and United States. One multilateral treaty with Caricom members.

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56 DTT in Total: Argentina, Denmark, Indonesia, The Netherlands, Slovakia, Australia, Ecuador, Ireland, New Zealand, South Africa, Austria, Estonia, Israel, Norway, Spain, Bahrain, Finland, Italy, Panama, Sweden, Barbados, France, Japan, Peru, Switzerland, Belgium, Germany, Korea, Poland, Turkey Republic, Brazil, Greece, Kuwait, Portugal, Ukraine, Canada, Hong Kong, Latvia, Qatar, United Kingdom, Chile, Hungary, Lithuania, Romania, United Arab Emirates, China, Iceland, Luxembourg, Russia, Uruguay, Colombia, India, Malta, Singapore, USA, Czech Republic.

15

Topic

Nicaragua

Currency

Nicaraguan Cordoba (NIO)

Official language(s)

Spanish

Taxation of individuals (tax base)

Only income within Nicaraguan territory

Individuals Income tax rates

5%-30%. Depends on the source or type of activity (it may be 1%, 2%, 3%, 7%, 10%, 12.50% or 15%). 30% only for companies

Specific or general expatriate tax provisions

No

Corporate income tax rates (standard rate)

30%

Tax Residence and Permanent Establishment (PE)

Tax residence is obtained by the incorporation in the national territory, also branches of foreign companies which in turn is a form of permanent establishment. The various forms of permanent establishment are also considered tax residents.

Branch Profits Tax Rate (Permanent Establishments)

30%

Branch remittance tax

0% - if interest payable: 15%

Tax losses

3 years carry forward. If there are losses, then the company will pay 1% of total income

Domestic withholding tax rate (WHT) on dividends paid

15%

Domestic withholding tax rate (WHT) on interests paid

15% foreign funding. Foreign financial institutions

Domestic withholding tax rate (WHT) on royalties paid

15%

Domestic withholding tax rate (WHT) on certain fees paid

15%

Specific or general Transfer Pricing (TP) regulations

No

Specific or general Thin Capitalization (D:E) regulations

No

Specific or general Controlled Foreign Companies (CFC) regulations

No

OECD Base Erosion and Profit Shifting (BEPS) participation

No

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

No

Bilateral Investment Treaties (in force)

17

Tax Treaty Network in force

None

16

Panama

Paraguay

Panamanian Balboa (PAB) / US Dollar (USD) both circulate freely (day to day)

Paraguay Guarani (PYG)

Spanish

Spanish - Guarani

Territorial Tax System

Territoriality

15% - 25%

8%-10%

Yes, depending on the type of Visa

No

25%

10%

A corporation, branches of foreign corporations and Permanent Establishments are considered residents, only if they receive taxable income (obtained in the Republic of Panama)

A corporation is generally considered resident if it is incorporated in PARAGUAY. Branches of foreign corporations and Permanent Establishments are also considered as residents.

25%

10%

12.5% (It is applied different rates in cases of countries having signed tax agreements to avoid double taxation)

15%

5 years carry forward. However, losses set off in each year is capped at 50% of taxable income

No

10% - nominal shares, and 20% bearer shares. (There are some exceptions with beneficiaries of countries with signed agreements to avoid double taxation)

15%

12.5% (There are some exceptions with beneficiaries of countries with signed agreements to avoid double taxation)

15%

12.5% (There are some exceptions with beneficiaries of countries with signed agreements to avoid double taxation)

15%

12.5% (There are some exceptions with beneficiaries of countries with signed agreements to avoid double taxation)

15%

Yes

No

Yes

No

No

No

No

No

No

No

Yes

No

YES

No

21

18

Barbados, Korea -South, United Arab Emirates, Spain, France, Ireland, Israel, Italy, Luxembourg, Mexico, Netherlands, Portugal, Qatar, United Kingdom, Czech Republic, Singapore, Vietnam and Japan

Germany, Belgium, Chile, Argentina and Uruguay

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17

Topic

Peru

Currency

Peruvian Sol (PEN)

Official language(s)

Spanish

Taxation of individuals (tax base)

Domiciled individuals: Worldwide Income - Non Domiciled individuals: Income from Peruvian Source

Individuals Income tax rates

8% - 30%

Specific or general expatriate tax provisions

None

Corporate income tax rates (standard rate)

29.5% (as of 2017)

Tax Residence and Permanent Establishment (PE)

Corporations and partnerships are considered domiciled if incorporated in Peru. Branches and Permanent Establishments of foreign entities are also considered domiciled in Peru.

Branch Profits Tax Rate (Permanent Establishments)

29.5% (as of 2017)

Branch remittance tax

5.0% (as of 2017)

Tax losses

Carry forward: (a) 4 years as from January 1st of the subsequent year; or (b) Indefinitely if 50% of following years profits are applied to offset a year loss.

Domestic withholding tax rate (WHT) on dividends paid

5% (As from 2017) 6.8% (for distributions of profits obtained in 2015 and 2016)

Domestic withholding tax rate (WHT) on interests paid

30% and 4.99% under certain conditions

Domestic withholding tax rate (WHT) on royalties paid

30%

Domestic withholding tax rate (WHT) on certain fees paid

30% and 15% on technical assistance

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

No, except for activities such as public services, TV and radio, and newspapers

OECD Base Erosion and Profit Shifting (BEPS) participation

No

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

No

Bilateral Investment Treaties (in force)

18

Tax Treaty Network in force

Andean Community (Bolivia, Colombia, Ecuador, Venezuela) Brasil, Canada, Chile, Mexico, Portugal, South Korea, Switzerland.

18

Saint Martin

Uruguay

Netherlands Antillean Guilder (ANG or Nafl)

Uruguayan Peso (UYU)

Dutch and English

Spanish

Worldwide income

Uruguayan source income with some extensions of foreign source

12.5%-47.5%

0% - 36%

yes

No

30%

25%

A corporation is considered resident if it has been incorporated in Sint Maarten or has it's place of effective management in Sint Maarten or has real estate in Sint Maarten or receivables covered by a mortgage

Residents are companies incorporated according to Uruguayan law. PE taxed as residents.

30%

25%

not applicable

7%

10 years carry forward

5 years carry forward

0.0%

7%

0.0%

12% general rate and 25% for fiscal paradises, states or territories with low or no taxation.

0.0%

12% general rate and 25% for fiscal paradises, states or territories with low or no taxation.

0.0%

12% general rate and 25% for fiscal paradises, states or territories with low or no taxation.

No

Yes

No

No

No

No

Yes

We are in the process of adjusting the internal regulations.

No

No

Yes

Yes

Yes

Starting in 2018

approx. 190 Bilateral Investment Treaties in force.

29

Netherlands, Norway

Germany, Argentina, Australia, Canada, Korea, Denmark, Ecuador, Spain, Finland, France, Greenland, Hungary, India, Iceland, Faroe Islands, Liechtenstein, Malta, Mexico, Norway, Portugal, Romania, Sweden, Switzerland, the Kingdom of the Netherlands, , Grand Duchy of Luxembourg, United Kingdom of Great Britain and Northern Ireland, Singapore, Vietnam and United Arab Emirates.

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19

Topic

United States

Currency

US Dollar (USD)

Official language(s)

English

Taxation of individuals (tax base)

Residents - Worldwide Income / Non-residents - US source income

Individuals Income tax rates

5% - 39.6%

Specific or general expatriate tax provisions

Yes, for citizens and permanent residents (green card holders)

Corporate income tax rates (standard rate)

15% - 35%

Tax Residence and Permanent Establishment (PE)

A corporation is generally considered resident if it is incorporated in the US. Branches of foreign corporations and Permanent Establishments are also considered as residents.

Branch Profits Tax Rate (Permanent Establishments)

15% - 35%

Branch remittance tax

30%

Tax losses

20 year carry forward

Domestic withholding tax rate (WHT) on dividends paid

30%

Domestic withholding tax rate (WHT) on interests paid

30%

Domestic withholding tax rate (WHT) on royalties paid

30%

Domestic withholding tax rate (WHT) on certain fees paid

30%

Specific or general Transfer Pricing (TP) regulations

Yes

Specific or general Thin Capitalization (D:E) regulations

Yes

Specific or general Controlled Foreign Companies (CFC) regulations

Yes

OECD Base Erosion and Profit Shifting (BEPS) participation

Yes

Foreign Exchange Controls applicable

No

US Foreign Account Tax Compliance (FATCA) applicable

Yes

OECD Automatic Exchange of Information (GATCA/CRS/TIEA) applicable

No

Bilateral Investment Treaties (in force)

66

Tax Treaty Network in force

Armenia, Australia, Austria, Azerbaijan, Bangladesh, Barbados, Belarus, Belgium, Bulgaria, Canada, China, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Jamaica, Japan, Kazakhstan, Korea, Kyrgyzstan, Latvia, Lithuania, Luxembourg, Malta, Mexico, Moldova, Morocco, Netherlands, New Zealand, Norway, Pakistan, Philippines, Poland, Portugal, Romania, Russia, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Tajikistan, Thailand, Trinidad, Tunisia, Turkey, Turkmenistan, Ukraine, United Kingdom, Uzbekistan, Venezuela

20

Venezuela Venezuelan Bolivar (VEF) Spanish Worldwide income 6% - 34% No 34% General (40% banking , financial, insurance and reinsurance, obtained by legal persons or entities domiciled in the country) A corporation is considered as a resident if it is incorporated in Venezuela. Branches of foreign corporations and Permanent Establishments are taxpayers in Venezuela only for income earned in the country 34% Does not exist 3 years carry forward (It is translatable only up to an amount equal to 25% of the Net Enrichment exercise to move) 34%, 50% or 60% (Depends of the payer activity ) To Banks and other similar Residence entities, 0%. To Banks and other similar Not Residence entities, 4.95%. To Foreign Companies, 15%, 22% or 34% (Depending on payment amount, and must be calculated on cumulative basis) To Foreign Companies, 15%, 22% or 34%, over 90% of the amount paid (Depending on payment amount, and must be calculated on cumulative basis) 3% - 5% Yes Yes Yes No Yes Yes Yes 19 Germany, Austria, Barbados, Belarus, Belgium, Brazil, Canada, China, Korea, Cuba, Denmark, United Arab Emirates, Spain, USA, France, Indonesia, Iran, Italy, Kuwait, Malaysia, Norway, The Netherlands, Portugal, Qatar, United Kingdom and Northern Ireland, Czech Republic, Russia, Sweden, Switzerland, Trinidad and Tobago, Vietnam

Contact Information

About Us

Claudia Ortiz Tax Committee Chair Crowe Horwath International claudia.ortiz@crowehorwath.com.ar

Crowe Horwath International is ranked eighth largest global accounting network with over 200 independent accounting and advisory services firms in close to 130 countries around the world. Crowe Horwath International’s member firms are committed to impeccable quality service, highly integrated service delivery processes and a common set of core values that guide decisions daily. Each firm is well established as a leader in its national business community and is staffed by nationals, thereby providing a knowledge of local laws and customs which is important to clients undertaking new ventures or expanding into other countries. Crowe Horwath International member firms are known for their personal service to privately and publicly held businesses in all sectors and have built an international reputation in the areas of audit, tax and advisory services.

www.crowehorwath.net

Crowe Horwath International is a leading international network of separate and independent accounting and consulting firms that may be licensed to use “Crowe,” “Crowe Horwath” or “Horwath” in connection with the provision of accounting, auditing, tax, consulting or other professional services to their clients. Crowe Horwath International itself is a non-practicing entity, and does not provide professional services in its own right. Neither Crowe Horwath International nor any member is liable or responsible for the professional services performed by any other member. © 2017 Crowe Horwath International.