• Tax Recovery

Tax Recovery

This service is oriented to improve the client's business liquidity by recovering amounts paid in taxes, either unduly or in excess.

We will analyze the corresponding source information and present the best alternatives to achieve a successful recovery process, applying accounting, tax and legal analysis to determine the most convenient and viable alternatives for these recovering taxes.

 

  1. Value Added Tax (VAT)

The legislation provides a period of 5 years to grant this tax refund to the following taxpayers:

Exporters: Those who pay VAT on local purchases or imports of goods, services or fixed assets used in the manufacture and marketing of exported goods are entitled to this tax refund.

Receptive Tourism Operators: Those who bill receptive tourism packages to individuals or companies not resident in Ecuador are entitled to this VAT refund paid on local purchases or imports of goods, services or fixed assets.

VAT Withholdings: Amounts withheld by customers and that could not be subject to any compensation may be considered for repayment by the Internal Revenue Service.

 

  1. Income Tax

Withholdings tax credit: The tax credit balance for withholding taxes is subject to a refund by the Tax Administration, which deadline for submitting the claim is three years from the expiration date of filing the tax return of the corresponding income tax.

Income tax advance recovery: Individuals, undivided successions required to maintain accounting, and companies may request the Internal Revenue Service - IRS to repay the income tax advance, for a single financial year corresponding to each triennium (First year of the first triennium, fiscal year 2010) if its economic activity is affected by unforeseeable circumstances or force majeure.

 

  1. Currency Exit Tax

Subject to refund is the tax credit balance for currency exit tax paid on the imports of raw materials, inputs and capital goods that are included in the tariff items defined by the Tax Policy Committee that are used in productive processes in the terms defined in the Production, Trade and Investment Organic Code. The deadline for submitting the application is five years from the due date of filing the income tax return.

 

  1. Claims for withholding income tax paid by foreign suppliers

Income tax withheld from suppliers domiciled in countries with which Ecuador has entered into agreements to avoid double taxation are subject to recovery. These withholdings apply to transactions of more than twenty basic fractions with zero rate of income tax for individuals.