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

August 28, 2024
2024-1614

Peru enacts regulations for 18% VAT on use of digital services by individuals

  • A new Supreme Decree establishes a first set of regulations for Legislative Decree 1623, which required nonresident digital service providers and sellers to register with the Value Added Tax (VAT) Registry and to remit to the Peruvian Tax Authority any VAT withheld on the payments made by customers for digital services.
 

Background

On 4 August 2024, the Executive enacted Legislative Decree 1623, establishing an 18% VAT on individuals' use of digital services via online platforms and importation of intangibles via the internet. Beginning 1 October 2024, nonresident digital service providers and sellers will be obliged to withhold this 18% VAT. (For more information on this issue, see EY Global Tax Alert, Peru enacts rules for levying 18% VAT on use of digital services by individuals, dated 6 August 2024).

Supreme Decree 157-2024-EF

The Supreme Decree provides the first set of Regulations for Legislative Decree 1623, establishing the following:

  • If a nonresident fails to register in the VAT Registry or to pay the VAT, the following entities will be responsible for the payment:
    • Peruvian financial entities and electronic money entities regulated by the Peruvian Banking Authority
    • The Peruvian National Bank
  • When the individual is the final user of the streaming services and is engaged in business activities, the VAT withheld by the nonresident could be used as input VAT by the individual. The invoice issued by the nonresident must establish the amount of the transaction, as a supporting document of the input VAT for the individual.
  • A new procedure provides for the nonresident to set off excess payments against future payments of the VAT and/or request the corresponding refund.

The following topics are yet to be regulated:

  • Rules regarding the registration of the nonresident in the VAT Registry
  • The option to pay the tax in Peruvian sols or US dollars
* * * * * * * * * *
Contact Information

For additional information concerning this Alert, please contact:

Ernst & Young Asesores Empresariales S.C.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

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor
 
 

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