The chamber of Deputies of Uruguay received for discussion the Accountability Bill on 20 June 2016. The Bill was issued by the Executive Branch. The Bill consists of several tax measures.
The corporate income tax measures included in the Bill are as follows:
- Instead of being deductible up to 100% of the positive net fiscal result, the total operative losses may be deducted during the subsequent 5 fiscal years after they were generated for up to 50% of the positive net fiscal result.
- The previous notional employer salary’s deduction scheme will be eliminated and therefore, the companies will be able to deduct the real employer’s salary.
- Partners or shareholders providing independent personal services to their own entities are now required to keep formal accounting records.
- The concept of economic unit will be incorporate into the Tax Code and in the case of an economic unit the entities will be jointly liable for their fiscal debts.
According to the Bill the most important income tax measures for non-residents will be as follows:
-In the following cases the current interest rate of 3% will be increased to 7%:
- For interest paid by financial institutions from long-term deposits made in Uruguayan pesos or with indexed units of more than 1-year term.
- For interest derived from corporate bonds or other debt instruments issued by resident entities with a period of more than 3-years.
- For income derived from certificates of participation in financial trusts with period of more than 3 years.
-The current interest rate of 5% applicable to 1-year term deposits or deposits of less than 1 year, in domestic currency without a readjustment clause will be increased to 7%.
-The current interest rate applicable to entities resident, domiciled, constituted or located jurisdictions with low or no taxation, or benefiting from a special regime of low or no taxation will be increased from 12% to 25%.
If the Bill is approved the amendments will become applicable as from 1 January 2017.
