In more detail
Article 1 of the Decree establishes the general exoneration from income tax for all income that individuals or legal entities residing or domiciled in Venezuela obtain from investments in securities and other similar instruments, provided that they have been issued and guaranteed by the CBV.
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Calculation of exonerated income
Pursuant to Article 2 of the Decree, the rules in the Income Tax Law (ITL)2 regarding income, costs and deductions of taxable income must be applied to calculate the exonerated income. Likewise, it is established that the common costs and deductions applicable to territorial or extraterritorial taxable or exonerated income will be distributed proportionally.
According to Article 3 and Article 4 of the Decree, the beneficiary must do the following to obtain the tax exoneration:
- File the annual income tax return of taxed and exonerated global net income, as applicable, in accordance with the ITL, the Income Tax Law Regulations ("ITL Regulations")3 and other applicable rules.
- Comply with all the obligations and requirements set forth in the Decree, the ITL, the ITL Regulations and other applicable rules.
In broad terms, Article 5 of the Decree establishes that beneficiaries that fail to comply with any obligation or requirement established in the Decree, as well as those established in the ITL, the ITL Regulations and other applicable regulations, will lose the exoneration.
We remain at your disposal should you require further details or explanations on the general aspects of the Decree highlighted in this alert, and for any related queries.
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1 Decree No. 5,127, whereby the income obtained by holders, individuals and legal entities residing or domiciled in Venezuela from investments made in securities or other similar instruments issued and guaranteed by the CBV are exonerated from income tax, under the terms and conditions provided for in the Decree. Published in extraordinary official gazette No. 6,905 on 8 May 2025.
2 Law of Partial Reform of the Decree with Value and Force of Law on Income Tax, published in extraordinary official gazette No. 6,210 on 30 December 2015.
3 Regulations of the ITL, published in extraordinary official gazette No. 5,662 on 24 September 2003.
