Corporate tax in Peru


Corporate Income Tax Rate (%) 28 (a) (b)
Capital Gains Tax Rate (%) 0 / 5 / 30 (c)
Branch Tax Rate (%) 28 (d)
Withholding Tax (%)
Dividends 6.8 (e)
Interest 4.99 / 30 (f) (g)
Royalties 30 (f)
Technical Assistance 15 (f)
Digital Services 30 (f)
Branch Remittance Tax 6.8 (d)
Net Operating Losses (Years)
Carryback 0
Carryforward 4 / Unlimited (h)

a) The corporate income tax is 28% for the 2015 and 2016 fiscal years. For the 2017 and 2018 fiscal years, the rate will be 27%. For the 2019 fiscal year and future years, the rate will be 26%.

b) Mining companies are subject to an additional Special Mining Tax or to “voluntary” payments. For further details, see Section B.

c) Capital gains derived by nonresident entities are subject to income tax at a rate of 5% if the transfer is made in Peru. Otherwise, the rate is 30%. For the period of 1 January 2016 through 31 December 2018, capital gains derived from the transfer of shares, or listed securities representing shares, carried out through the Peruvian stock exchange are exempt from tax if certain conditions are met. For further details regarding the applicable tax rates, see Capital gains in Section B. Capital gains derived by resident entities are subject to income tax at a rate of 28%.

d) Branches and permanent establishments of foreign companies are subject to the same corporate income tax rate as domiciled companies.

e) The Dividend Tax, which is imposed at a rate of 6.8% and is generally with­held at source, is imposed on profits distributed to nonresidents and individu­als. The Dividend Tax rate will increase to 8% for the 2017 and 2018 fiscal years and to 9.3% for the 2019 fiscal year and future years. For further details regarding the Dividend Tax, see Section B.

f) This tax applies to payments to nonresidents.

g) A reduced rate of 4.99% applies to certain interest payments. For further details, see Section B.

h) See Section C.

Taxes on corporate income and gains

Corporate income tax. Resident companies are subject to income tax on their worldwide taxable income. Resident companies are those incorporated in Peru. Branches and permanent establish­ments of foreign companies that are located in Peru and nonresi­dent entities are taxed on income from Peruvian sources only.

Tax rates. The corporate income tax is 28% for the 2015 and 2016 fiscal years. For the 2017 and 2018 fiscal years, the rate will be 27%. For the 2019 fiscal year and future years, the rate will be 26%.

A Dividend Tax at a rate of 6.8% is imposed on distributions of profits to nonresidents and individuals by resident companies and by branches, permanent establishments and agencies of foreign companies. This tax is generally withheld at source. However, in certain circumstances, the company must pay the tax directly. For details regarding the Dividends Tax, see Dividends.

Mining tax. Mining companies are subject to an additional Special Mining Tax based on a sliding scale, with progressive marginal rates ranging from 2% to 8.4%. The tax is imposed on a quarterly basis on the operating profits derived from sales of metallic min­eral resources, regardless of whether the mineral producer owns or leases the mining concession.

In addition, mining companies that have signed stability agree­ments with the state are subject to “voluntary” payments, which are calculated based on a sliding scale with progressive marginal rates ranging from 4% to 13.12%. These rates are applied on a quarterly basis to the operating profits derived from sales of metallic mineral resources, regardless of whether the mineral producer owns or leases the mining concession. Higher tax rates apply to higher amounts of operating profits.

Tax incentives. Various significant tax incentives are available for investments in the following:

  • Mining enterprises
  • Oil and gas licens es and services contracts
  • Certain agricultural activities

They are also available for investments in manufacturing indus­tries located in the jungle, in designated tax-free zones and in borderline areas of the country.

Capital gains. Capital gains de rived by nonresident entities are subject to income tax at a rate of 5% if the transfer is made in Peru. Otherwise, the rate is 30%. The regulations provide that a transaction is made in Peru if the securities are transferred through the Peruvian stock exchange. The transaction takes place abroad if securities are not registered with the Peruvian stock exchange or if registered securities are not transferred through the Peruvian stock exchange.

A special procedure has been introduced to determine the tax basis of listed securities acquired before 1 January 2010. The gen­eral rule is that the tax basis for these securities is the value of such securities at the closing of 31 December 2009, if this value is not lower than the price paid for the acquisition of the securi­ties. The purpose of this rule is to impose capital gains tax only on the capital gain resulting from the appreciation of securities from 1 January 2010 (time when the exemption was repeal ed) and onward.

For the period of 1 January 2016 through 31 December 2018, the transfer of listed shares, or listed securities representing shares, carried out through the Peruvian stock exchange is exempt from capital gains tax if the following conditions are met:

  • In any 12-month period, the taxpayer and its related parties must not transfer more than 10% of the shares or securities represent­ing shares issued by the company whose shares are sold.
  • The shares must be considered “stock market shares.” Numerical parameters are established for “stock market shares.” At the opening of the stock market session, CAVALI (the Peruvian clearing house) publishes daily the shares and the securities re­presenting shares that comply with the requirements to be con­sidered “stock market shares.”

Capital gains derived from the disposal of bonds issued by the government as well as by Peruvian corporations before 10 March 2007, through public offerings, are exempt from Peruvian income tax.

CAVALI withholds capital gains in transactions concluded on the Lima Stock Exchange. As a result, nonresidents are not required to pay their income tax liability to the Peruvian Tax Administration.

Indirect transfers of Peruvian shares are also subject to a 30% Peruvian capital gains tax. For this purpose, an indirect transfer of Peruvian shares is deemed to occur if the following conditions are met:

  • At any time during the 12 months before the transaction, at least 50% of the value of the foreign company derives from one or more companies.
  • More than 10% of the shares of the foreign company had been transferred during the 12-month period before the transaction.

Temporary provisions established a special procedure to deter­mine the tax basis of shares acquired before 16 February 2011. Under this procedure, the tax basis is the higher of the price paid on acquisition or the market value on 15 February 2011.

Administration. The mandatory closing date for business enter­prises is 31 December. Tax returns must be filed by the end of March or beginning of April, depending on the taxpayer number.

Companies must make advance payments of income tax. Such payments can be used as a credit against the annual income tax obligation, or they can be refunded at the end of the fiscal year if requested by the taxpayer.

The monthly advance payments equal the higher of the following amounts:

  • The amount obtained by applying to the monthly net income the ratio obtained by dividing the amount of tax calculated for the preceding tax year by the total net income for that year. For the January and February payments, the ratio is determined by dividing the amount of tax calculated for the year before the preceding tax year by the net income for that year.
  • The amount obtained by applying a 1.5% rate to the net income for the month.

Companies in a start-up process or in a net operating loss position make monthly advance payments equal to 1.5% of their monthly net income.

Monthly advance payments are due on the 9th to the 15th business day, according to a schedule. Taxes and related penalties not paid by due dates are subject to interest charges, which are not deduct­ible for tax purposes.

Dividends. Until 31 December 2014, Dividend Tax, which is gen­erally withheld at source, was imposed at a rate of 4.1%. Effective from 1 January 2015, the Dividend Tax rate is increased to 6.8% for the 2015 and 2016 fiscal years. The rate will be increased to 8% for the 2017 and 2018 fiscal years and to 9.3% for the 2019 fiscal year. Accrued profits derived up to 31 December 2014 will be subject to the withholding tax rate of 4.1% even though they are distributed in 2015 or future years.

The Dividend Tax applies to profits distributed to nonresidents and individuals, if a distribution agreement is adopted by the relevant corporate body on or after 1 January 2003. All profits distributed thereafter, including those corresponding to prior years, are subject to this tax.

The Dividend Tax applies to distributions by Peruvian compa­nies, as well as to distributions by Peruvian branches, permanent establishments and agencies of foreign companies. The income tax law specifies various transactions that are considered profits distributions by resident entities for purposes of the Dividend Tax. These transactions include the distribution of cash or assets, other than shares of the distributing company, and, under certain circumstances, a capital reduction or a liquidation of the com­pany. For permanent establishments, branches, and agencies of foreign companies, a distribution of profits is deemed to occur on the deadline for filing their annual corporate income tax return (usually at the end of March or the beginning of April of the fol­lowing tax year).

The law also provides that if a resident company, or a branch, permanent establishment or agency of a foreign company, pays expenses that are not subject to further tax control, the amount of the payment or income is subject to the Dividend Tax. Dividend Tax for these items is paid directly by the resident entity or the branch or permanent establishment. In this case, the tax rate is 4.1%.

The capitalization of equity accounts, such as profits and re­serves, is not subject to the Dividend Tax, unless these items are further distributed.

Interest. Interest paid to nonresidents is generally subject to with­holding tax at a rate of 30%. For interest paid to unrelated for eign lenders, the rate is reduced to 4.99% if all of the following condi­tions are satisfied:

  • For loans in cash, the proceeds of the loan are brought into Peru as foreign cur rency through local banks or are used to finance the import of goods.
  • The proceeds of the loan are used for business purposes in Peru.
  • The participation of the foreign bank is not primarily intended to cover a transaction between related parties (back-to-back loans).
  • The interest rate does not exceed the London Interbank Offered Rate (LIBOR) plus seven points. For this purpose, interest in­cludes expenses, commissions, premiums and any other amounts in addition to the interest paid.

If the first three conditions described above are satisfied and the interest rate exceeds the LIBOR plus seven points, only the excess interest is subject to withholding tax at the regular rate of 30%.

Interest arising from loans granted by international banks to Peru­vian banks and financial institutions is subject to a 4.99% with­holding tax.

In general, interest derived from bonds and other debt instru­ments is also subject to a withholding tax rate of 4.99%, unless the holder of the bonds or other debt instruments is related to the issuer or its participation is primarily intended to avoid transac­tions between related parties (back-to-back transactions).

Interest earned on bonds issued by the government is exempt from tax. Effective from 1 January 2010, interest on bonds issued by Peruvian corporations before 11 March 2007, in general through public offerings, is exempt from tax. Interest from deposits in Peruvian banks is subject to a 4.99% withholding tax if the ben­eficiary is a foreign entity.

Other withholding taxes. Payments for technical assistance used in Peru are subject to withholding tax at a rate of 15%, regardless of whether the technical assistance is effectively provided. If the consideration exceeds 140TaxUnits (approximatelyUSD155,774), the local user must obtain and provide to the Peruvian tax author­ity a report from an audit company confirming that the technical assistance services were actually rendered.

Payments for digital services that are provided through the inter-net and used in Peru are subject to withholding tax at a rate of 30%.

Payments for non-technical services provided in Peru are subject to withholding tax at a rate of 30%.

Foreign tax relief. Tax credits are permitted, within certain limits, for taxes paid abroad on foreign-source income. Under domestic legislation, a direct tax credit is allowed. Under certain trea­ties, an indirect tax credit is allowed.

Determination of trading income

General. Taxable income of business enterprises is generally com­puted by reducing gross revenue by the cost of goods sold and all expenses necessary to produce the income or to maintain the source of income. However, certain types of revenue must be com­puted as specified in the tax law, and some expenses are not fully deductible for tax purposes. Business transactions must be re­corded in legally authorized accounting records that are in full compliance with International Financial Reporting Standards (IFRS). The accounting records must be maintained in Spanish and must be expressed in Peruvian currency. However, under certain circumstances, foreign investors who invest in foreign currency may enter into an agreement with the state or with state-owned corporations that allows them to keep their accounting books in foreign currency.

Research and development expenses. Up to 31 December 2013, the deduction of scientific and technological research and inno­vation expenses incurred by a company was limited to 10% of the annual net income, with a maximum annual limitation of 300 Tax Units (approximately USD333,800). Effective from 1 January 2014, these limits were eliminated.

In addition, to be tax-deductible, the expenses must be previ­ously qualified. Effective from 1 February 2014, the treatment of research and development expenses varies depending on whether they are related to the core business of the taxpayer.

A temporary tax benefit is available for taxpayers that carry out scientific research, technological and innovation development projects beginning on or after 1 January 2016. The tax benefit is an additional expense deduction of 50% or 75%, if certain condi­tions are met. The projects do not have to be related to the tax-payer’s core business. The additional deduction of 50% or 75% cannot exceed 1,335 Tax Units (approximately USD1,485,422). The benefit will be effective until the 2019 fiscal year.

Inflation adjustments. For tax and accounting purposes, inflation adjustments apply only until 31 December 2004. Consequently, beginning 1 January 2005, transactions are recognized and re­corded in local books at their historical value.

Special activities. Nonresident corporations, including their branches and agencies, engaged in certain specified activities are subject to tax on only a percentage of their gross income deriv­ed from such activities. This tax is withheld at source. The fol­lowing are the applicable percentages for some of these specified activities.

Activity Applicable percentage (%)
Air transportation 1 (a) (b)
Marine transportation 2 (a) (b)
Leasing of aircraft 60 (c)
Leasing of ships 80 (c)
International news agencies 10 (a)


a) The withholding tax rate is 30%. As a result, the effective tax rates are 0.3% for air transportation, 0.6% for marine transportation and 3% for interna­tional news agencies.

b) This percentage applies to services rendered partly in Peru and partly abroad.

c) The withholding tax rate is 10%. As a result, the effective tax rates are 6% for leasing of aircraft and 8% for leasing of ships.

Inventories. Inventories must be carried at cost. Cost may be de­termined specifically or by the first-in, first-out (FIFO), average, retail or basic inventory method. The last-in, first-out (LIFO) method is not permitted.

Provisions. Provisions for bad debts, bonuses, vacations, employ­ees’ severance indemnities and other expenses are allowed if made in accordance with certain tax regulations.

Tax depreciation. Depreciation rates are applied to the acquisition cost of fixed assets. The following are some of the maximum annual depreciation rates allowed by law.

Asset Maximum rate (%)
Buildings and structures 5*
Cattle and fishing nets 25
Vehicles 20
Machinery and equipment for construction,
mining and oil activities
Machinery and equipment for other activities 10
Data processing equipment 25
Other fixed assets 10

* This is a fixed rate rather than a maximum rate. Also, see below.

Taxpayers may apply any depreciation method for its fixed assets other than buildings and structures, taking into account the char­acteristics of the business as long as the resulting depreciation rate does not exceed the maximum rates stated above.

In general, except for buildings and structures, tax depreciation must match financial depreciation.

Under the Special Regime of Depreciation for Buildings, which is effective from 1 January 2015, buildings can be depreciated for income tax purposes at an annual depreciation rate of 20% if certain conditions are met.

Relief for losses. Taxpayers may select from the following two systems to obtain relief for their losses:

  • Carrying forward losses to the four consecutive years beginning with the year following the year in which the loss is generated
  • Carrying forward losses indefinitely, subject to an annual de – ductible limit equal to 50% of the taxpayer’s taxable income in each year

Loss carrybacks are not allowed.

Other significant taxes

The following table summarizes other significant taxes.

Nature of tax Rate (%)
Temporal net assets tax; imposed on
companies, and on agencies, branches
and permanent establishments of foreign
entities; the tax base equals the value
of the net assets of the taxpayer as of
31 December of the preceding year that
exceeds PEN1 million (approximately
USD281,690); the tax payments may offset
the advance payments required under the
general income tax regime or may be
claimed as a credit against the income tax
payable for the tax year; a refund may be
requested for any balance of tax payment
that is not used in the current year; the tax
does not apply to certain companies; tax is
payable beginning in the year following the
first year of productive activities
Sales tax, on the sale of goods, services
and the import of most products
Excise tax, on goods and imports; the tax
is either a fixed amount or an amount
determined by applying a percentage rate
Social security contributions to the Peruvian
Health Social Security Office, on salaries
and legal bonuses; paid by employer
Pension Fund; paid by employee 13
(Alternatively, employees may contribute
approximately 11.8% of their salaries to
the Private Pension Funds Trustee [AFP].)
Employees’ profit sharing; calculated on
pretax income and deductible as an expense
in determining taxable income; rate varies
depending on companies’ activities (mining,
fishing, manufacturing, telecommunications
and other activities)
5 to 10
Tax on Financial Transactions; imposed on
debits and credits in Peruvian bank accounts

Miscellaneous matters

Foreign-exchange controls. Peru does not impose foreign-currency controls. Exchange rates are determined by supply and demand.

Means of payment. Any payment in excess of PEN3,500 or USD1,000 must be made through the Peruvian banking system using the so-called “Means of Payment,” which include bank de­posits, wire transfers, pay orders, credit and debit cards and non­negotiable checks. Non-compliance with this measure results in the disallow ance of the corresponding expense or cost for in come tax purposes. In addition, any sales tax (see Section D) related to the acquisition of goods and services is not creditable.

Related-party transactions. Expenses incurred abroad by a non­resident parent company, affiliates or the home office of a Peru­vian subsidiary or branch (or prorated allocations of administrative expenses incurred by those entities) are deemed by law to be related to the generation of foreign revenue and, accordingly, non­deductible, unless the taxpayer can prove the contrary.

Transfer pricing. Peru has introduced transfer-pricing rules, which are consistent with the Organisation for Economic Co-operation and Development (OECD) guidelines. Intercompany charges must be determined at arm’s length. Regardless of the relationship be – tween the parties involved, the fair market value (FMV) must be used in various types of transactions, such as the following:

  • Sales
  • Contributions of property
  • Transfers of property
  • Provision of services

For the sale of merchandise (inventory), the FMV is the price typ­ically charged to third parties in profit-making transactions. For frequent transactions involving fixed assets, the FMV is the value used in such frequent transactions by other taxpayers or parties. For sporadic transactions involving fixed assets, the FMV is the appraisal value.

In the event that the transactions are performed without using the FMV, the tax authorities make the appropriate adjustments for the parties to the transaction.

The FMV of transactions between related parties is the value used by the taxpayer in identical or similar transactions with unrelated parties. The tax authorities may apply the most appropriate of the following transfer pricing methods to reflect the economic reality of the transactions:

  • Comparable uncontrolled price method
  • Cost-plus method
  • Resale price method
  • Profit-based method

Effective from January 2013, specific rules are introduced for applying the comparable uncontrolled price method to the expor­tation and importation of commodities and other products, with prices set by reference to commodity prices.

The transfer-pricing rules provide for advance price agreements between taxpayers and the Peruvian tax authorities.

Domiciled taxpayers must file an information return if either of the following circumstances exists:

  • The total amount of the operations (revenues and expenses) with related parties is higher than PEN200,000 (approximately USD56,338).
  • They have disposed assets to related parties to, from or through a low-tax jurisdiction (tax haven) and the basis costs are lower than fair market value.

Taxpayers that must file information returns must file them in June of the following fiscal year in accordance with the Tax Administration’s schedule.

Domiciled taxpayers must prepare a transfer-pricing study if either of the following circumstances exists:

  • Gross revenues are higher than PEN6 million (approximately USD1,690,140), and the total amount of operations with related parties is higherthanPEN1 million (approximatelyUSD281,690).
  • They have disposed of assets to related parties to, from or through a low-tax jurisdiction (tax haven) and the basis costs (purchase prices for purposes of calculating taxable capital gains and losses) are lower than fair market value.

Taxpayers that must file a transfer-pricing study must file it in June of the following fiscal year in accordance with the Tax Administration’s schedule.

Debt-to-equity rules. Interest on loans from related parties in ex – cess of a 3:1 debt-to-equity ratio is not deductible.

Transactions with residents in low-tax jurisdictions (tax havens). Expenses incurred in transactions with residents in low-tax juris­dictions (tax havens) are not deductible for tax purposes, except for the following:

  • Toll payments for the right to pass across the Panama Channel
  • Expenses related to credit operations, insurance or reinsurance, leasing of ships or aircraft and freight services to and from Peru

The following are considered low-tax jurisdictions.

Alderney                     Dominica                     Netherlands

Andorra                      Gibraltar                       Antilles

Anguilla                      Granada                       Niue

Antigua and                Guernsey                     Panama

Barbuda                      Hong Kong SAR         St. Kitts and Nevis

Aruba                         Isle of Man                  St. Lucia

Bahamas                     Jersey                           St. Vincent and

Bahrain                       Labuan                         the Grenadines

Barbados                    Liberia                          Seychelles

Belize                          Liechtenstein                Tonga

Bermuda                     Luxembourg                Turks and Caicos

British Virgin             Maldives                      Islands

Islands                        Marshall Islands          US Virgin Islands

Cayman Islands                  Monaco                      Vanuatu

Cook Islands                      Montserrat                  Western Samoa

Cyprus                                Nauru

The double tax treaty between Peru and Portugal became effec­tive on 1 January 2015. Consequently, for Peruvian tax purposes, Madeira is no longer considered to be a tax haven.

In addition to the jurisdictions mentioned above, other jurisdic­tions are considered low-tax jurisdictions if the effective rate of income tax in the jurisdiction is 0% or if the effective rate that would apply to the relevant income is at least 50% less than the rate that would apply under the general income tax regime in Peru, and if one of the following additional conditions is met:

  • The jurisdiction does not provide information regarding the taxation of companies in the jurisdiction.
  • A tax benefit regime in the jurisdiction applies to nonresidents only.
  • Beneficiaries of tax benefits in the jurisdiction may not carry out business activities in the jurisdiction.
  • The jurisdiction promotes itself as a jurisdiction that can assist companies in the reduction of their taxation in their home countries.

Controlled foreign corporations. Recent amendments to the Peru­vian Income Tax Law introduced the International Fiscal Trans­parency System, which applies to Peruvian residents who own a controlled foreign corporation (CFC). These amendments estab­lished the requirements for a foreign company to be qualified as a CFC. For these purposes, the ownership threshold is set at more than 50% of the equity, economic value or voting rights of a non­resident entity.

In addition, to be considered a CFC, a nonresident entity must be resident of either of the following:

  • A tax-haven jurisdiction
  • A country in which passive income is either not subject to in­come tax or subject to an income tax that is equal to or less than 75% of the income tax that would have applied in Peru

The amendments also provide a list of the types of passive in­come that must be recognized by the Peruvian resident (such as dividends, interest, royalties and capital gains).

The revenues are allocated based on the participation that the Peruvian entity owns in a CFC as of 31 December.

General anti-avoidance rule. Under a general anti-avoidance rule, which took effect on 19 July 2012, to determine the true nature of a taxable event, the Peruvian Tax Administration takes into account the events, situations and economic relationships that are actually carried out by the taxpayers.

If the Peruvian Tax Administration identifies a tax-avoidance case, it may demand payment of the omitted tax debt or decrease the amount of any credits, net operating losses or other tax benefits obtained by the taxpayer.

In addition, the rule establishes specific requirements to deter­mine whether a taxpayer intended to avoid all or part of a taxable event or reduce the tax base or tax liability.

Also, if the Peruvian tax authorities determine that the taxpayer executed sham transactions, it applies the appropriate tax rules to such acts.

Nonetheless, the application of the general anti-avoidance rule has been temporally suspended until further guidance explaining the conditions that must be met to apply this rule.

Domestic reorganizations. Under the existing Income Tax Law, domestic reorganizations are subject to a tax-free regime, to the extent that the basis of the assets included in the reorganization is kept at historical value. A law, which is effective from 1 Janu­ary 2013, maintains this regime but establishes a minimum hold­ing period in cases of spin-off reorganizations. The law states that the shareholders of the company being spun off that receive shares in the company to which the assets are contributed must keep the shares of the latter company until the closing of the next fiscal year following the reorganization. If the shares are trans­ferred before that time, the underlying assets are deemed to be transferred by the acquiring company at market value. The tax is determined by the difference between the historic tax basis and the market value. In addition, the shareholder selling the shares is subject to the ordinary capital gains tax.

Tax treaties

Peru has entered into double tax treaties with Brazil, Canada, Chile, Korea (South), Mexico, Portugal and Switzerland. It has also signed an agreement to avoid double taxation with the other members of the Andean Community (Bolivia, Colombia and Ecuador) under which the exclusive right to tax is granted to the source country. The following is a table of treaty withholding tax rates.







Brazil 10/15 (a) 15 15
Canada 10/15 (a) 15 15
Chile 10/15 (a) 15 15
Korea (South) 10 15 10/15
Mexico 10/15 (a) 15 15
Portugal 10/15 (a) 10/15 10/15
Switzerland 10/15 (a) 10/15 10/15
Non-treaty countries 6.8 (b) 4.99/30 (b) 30

a) The dividends tax rate may vary depending on the percentage of the direct or
indirect ownership of the beneficiary in the payer company.

b) See Section B.