On 12 November 2020, the Internal Revenue Service (SRI) Officially published Resolution No. NAC-DGERCGC20-00000067 of 12 November 2020, amending the Resolution No. NAC-DGERCGC18-00000433 that establishes the maximum amounts and requirements for the automatic application of the benefits provided in agreements to avoid double taxation.
The reformatory Resolution adds a transitory provision to the amended Resolution, which establishes that as of 11 March 2020, the date of the declaration of COVID-19 as a pandemic, made by the World Health Organization, and only until 18 months later, withholding agents who do not have the beneficiary’s certificate of tax residence, at the time of withholding, may automatically apply the benefits provided in the Agreements to Avoid Double Taxation signed by the Republic of Ecuador, as long as it is complied with. with at least one of the requirements listed in article 4 of Resolution No. NAC-DGERCGC18-00000433.
The withholding agent must obtain the respective certificate of tax residence issued by the corresponding jurisdiction, with all the formalities required by the Ecuadorian legal system, within 24 months from 11 March 2020. Failure to do so within the timeline, the withholding agent must submit the replacement statement and pay the corresponding amounts and interest.
