Tax
Territorial income tax, 13% VAT and a digital-asset exemption
Income tax under the Ley de Impuesto sobre la Renta is territorial in principle, with specific rules capturing certain foreign-source passive income. VAT is 13%. Bitcoin and other digital assets were exempted from income tax to support the 2021 legal-tender policy.
Key rules
- Corporate income tax is 30%, reduced to 25% for taxpayers with income below USD 150,000.
- IVA is 13% with a limited list of exemptions; exports are zero-rated.
- Dividends bear a 5% withholding; payments to non-residents are generally withheld at 20%.
- Gains from digital assets are exempt from income tax under the Ley Bitcoin and the 2023 digital-assets statute.
- Transfer pricing follows the arm's-length standard, with a market-value rule in the Código Tributario.
Governing law
- Ley de Impuesto sobre la RentaIncome tax.
- Ley de Impuesto a la Transferencia de Bienes Muebles y a la Prestación de ServiciosVAT.
- Código TributarioAssessment, penalties and transfer pricing.
In practice
Electronic invoicing is being phased in by taxpayer size through the Ministry of Finance. The digital-asset exemption applies to the asset gain, not to underlying business income received in bitcoin, which remains taxable at its dollar value.