Peruvian VAT rates and VAT compliance

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:

Rate	Type	Which goods or services
18%	Standard	All other taxable goods and services (16% state VAT + 2% municipal VAT)

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

Get help solving your VAT challenges