Peruvian VAT rates and VAT compliance
Peruvian VAT rates
The standard VAT rate for Peru is 18%, which is made up of 16% VAT plus a municipal tax (Impuesto de Promoción Municipal) of 2%. Exports are subject to a nil VAT rate.
Exempt supplies include: agriculture; education; basic foodstuffs; low-value new residential buildings; financial services; public transport; public post; international freight transport; livestock; gambling; and live events.
Certain supplies are liable to withholding VAT, ‘SPOT’, of 4%, 10% or 12%. These include outsourcing services. Tax payers must split the VAT withheld, and remit it to a special VAT account with the national bank. Balances held on this account may be used to settle future liabilities or reclaimed after three months.
Small businesses may apply for a flat-rate VAT procedure, whereby they are set a fixed about of VAT due based on the size of their monthly turnover.
The current rates are:
Peruvian VAT compliance
There are detailed rules controlling the recording and processing of transactions for VAT. These include guidelines on:
- Invoices must be provided with all taxable supplies
- There is no simplified VAT invoice allowance
- FX amounts on any invoice must be converted at the prevailing SOL rate
- Electronic invoices are required of businesses identified by the General Tax and Customs Administration. These are generally large taxpayers.
- Credit notes may be provided, but must have a unique identification code and refer to the original sales invoice
Invoices must include the following information:
- Name, address and tax number of the supplier
- Name, address and tax number of the customer
- The word invoice “Factura” on the invoice
- Unique VAT number
- The tax number of the invoice printer
- Description of the goods or services
- Date of the invoice
- Amount charged, VAT and total gross value
Time of supply rules
The rules on determining when VAT is due, the time of supply, are as follows:
- When goods are delivered
- Earlier of invoice, payment or provision of supplies, including non-resident provided supplies
- Prepayment when cash is paid
- When goods clear customs for imports