Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

January 11, 2023
2023-5034

Peru enacts preferential depreciation rates for buildings, construction and hybrid and electric vehicles

  • Peruvian Congress enacted Law 31652 introducing preferential depreciation rates for buildings, construction, and hybrid and electric vehicles. The new regime became effective on 1 January 2023.

On 28 December 2022, Peruvian Congress enacted Law 31652, introducing preferential depreciation rates for specifics assets.

Background

The current depreciation rates established under the Peruvian tax legislation for buildings, construction and electric and hybrid vehicles are the following:

Buildings and construction

  • The Peruvian Income Tax Law establishes a fixed rate of 5% (straight-line method) for buildings and construction.
  • Under the special depreciation regimen applicable in 2021 for buildings and construction, taxpayers were entitled to elect to apply a 20% rate if the following requirements were met: (i) the construction began on or after 1 January 2020; and (ii) 80% or more of the work was completed by 31 December 2020.

Hybrid and electric vehicles (except railroads)

  • The Peruvian Income Tax Law establishes a maximum annual rate of 20%.
  • Under the special depreciation regimen applicable for assets acquired in 2020 and 2021, taxpayers are entitled to elect to apply a maximum annual rate of 50%.

Law 31652

Law 31652 introduces preferential depreciation rates applicable as of 1 January 2023, for the following assets:

Buildings and construction

Taxpayers are entitled to use a maximum rate of 33.33% if the construction has started as of 1 January 2023; and at least 80% of the construction is completed by 31 December 2024. The 33.33% rate will not apply if the assets have been totally or partially built before 1 January 2023.

Hybrid and electric Vehicles

Taxpayers are entitled to use a maximum annual rate of 50%, for hybrid and electric vehicles acquired in 2023 and 2024.

Law 31652 is effective as of 1 January 2023.

_________________________________________

For additional information with respect to this Alert, please contact the following: 

Ernst & Young Asesores Empresariales S. Civil de R.L., Lima

Ernst & Young LLP (United States), Latin American Business Center, New York

Ernst & Young LLP (United Kingdom), Latin American Business Center, London

Ernst & Young Tax Co., Latin American Business Center, Japan & Asia Pacific

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2024, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more