Most Significant Effects of the Change of the Value of the Tax Unit to Bs. 14,800 for Withholding

Profession:Torres Plaz & Araujo Abogados
 
FREE EXCERPT
By Carolina Soteldo Silva, Anabel Paz Miranda and Sergio Fernández

The new value of the T.U. applies to all national taxes. This means that any amounts set in tax units under our tax laws must be expressed in bolivars following its conversion using the new value of Bs. 14,800.

For VAT, individuals and legal entities shall be subject to the tax when making or expecting to make sales of goods or services in an amount greater than Bs. 44,400,000 during the current fiscal year.

1. FOR INDIVIDUALS

1a Income other than salaries and wages:

The change in value of the Tax Unit implied the modification of the applicable withholdings. For the purposes of income tax withholdings applicable to payments other than the salaries of individuals, the following subtrahends shall apply immediately, in accordance with the stated withholding percentage:

WITHHOLDING

SUBTRAHEND

PAYMENTS IN EXCESS OF Bs.

1%

12,333

1,233,334

3%

37,000

1,233,334

Accordingly, withholdings shall solely apply to individuals when a payment exceeds Bs. 1,233,334.

Additionally, in determining their Net Annual Income for Income Tax purposes, individuals are entitled to a standard exemption of 774 TUs, now equivalent to Bs. 11,455,200.

1b Income from Salaries and Wages:

The variation in the withholding percentages of the persons receiving salaries and wages must be notified to the withholding agents within the first fifteen days of March, in accordance with the provisions of the first paragraph of Article 7 of the current Withholding Regulations (Decree No. 1.808, Official Gazette No. 36.203). Such variations shall be considered from the month of April.

Additionally, only individuals expecting to obtain compensation from one or more debtors in excess of Bs. 14,800,000.00 during the current calendar year shall be subject to withholding at source, in accordance with Article 2 of the current Withholdings Regulations.

For individuals to determine the Net Annual Taxable Income under the Income Tax, the...

To continue reading

REQUEST YOUR FREE TRIAL