In depth
Pursuant to articles 30 and 32 of the Organic Law for the Partial Reform of the Decree with Status, Validity and Force of Organic Law on Science, Technology and Innovation, published in Official Gazette No. 6693 Extraordinary on 1 April 2022 ("LOCTI")2, any legal entity, private or public, domiciled or not in the Republic, that performs economic activities in the country and has obtained an annual gross revenue that exceeds 150,000 times the official exchange rate of the highest value currency established by the Central Bank of Venezuela in the immediately preceding fiscal year is obliged to make a monthly contribution to FONACIT for the promotion and performance of science, technology and innovation activities in the country ("Contribution").
Under Article 31 of the LOCTI, the monthly contribution consists of a percentage of the gross revenue of the immediately preceding monthly fiscal period, specifically (i) 2% for economic activities contemplated in the Law for the Control of Casinos, Bingo Halls and Slot Machines, and those related to the production and commercialization of ethyl alcohol, alcoholic beverages and tobacco; (ii) 1% for economic activities related to hydrocarbons or exploration and exploitation of gold and other strategic materials carried out by private capital companies; and (iii) 0.5% for public capital companies that carry out the activity described in (ii) and for all companies that carry out economic activities different to the aforementioned.
The Ruling establishes the specific rules to regulate the procedure for the assessment, self-assessment, payment and return filing of the Contribution.
Registry
Pursuant to Article 2 of the Ruling, contributors must be registered in the System for the Filing and Control of Contributions to Science, Technology and Innovation (SIDCAI) of FONACIT, following the steps established in the regulations contained in Administrative Ruling No. 015-047, dated 20 May 2021, published in Official Gazette No. 42131.
Definitions
The Ruling reiterates the definitions provided in Article 30 of the LOCTI regarding the entities that must contribute, and it establishes the obligation for legal entities to determine their own status as contributors.
Likewise, to calculate the Contribution, the Ruling defines gross revenue as the revenue, proceeds and cash earned by the contributors in a habitual, accidental or extraordinary manner for any activity they carry out, including income from exchange differentials, interests, dividends, placement of bonds of any denomination and operating income, among others, provided that they are not obliged to repay them for any reason, and that this revenue is not subject to costs or deductions of any kind.
Payment procedure
Contributors must estimate their annual gross revenue for the new fiscal year within 30 days following the end of the previous fiscal year. In this sense, the contributor must also estimate the monthly average of the corresponding Contribution and assess, self-assess, pay and file it within 15 days following the end of each month. The above estimates may be based on the Final Income Tax Return of the previous fiscal year.
In addition, contributors must self-assess the Contribution through FONACIT's SIDCAI system, or by other voluntary means, having to provide the proof of payment of the Contributions through the telematic means provided by FONACIT.
Finally, FONACIT, during the second trimester following the closing of the previous fiscal year, will recognize the contributions to the Telecommunications Research and Development Fund (FIDETEL) made by contributors that provide telecommunications services, for the purpose of the Contribution to FONACIT.
Estimates verification
During the second trimester following the closing of the immediately preceding fiscal year, FONACIT will verify the estimates made by the contributors. If the amount declared is higher than the amount due, a tax credit will be generated in favor of the contributor, which may be assigned or offset. If the estimate was below the amount due, the contributor will be notified in order to make the respective payment in the second trimester following the closing of the previous fiscal year. If payment is not made in a timely manner, the contributor may be subject to fines and late payment interest (if applicable).
For verification purposes, FONACIT will use the DPI Form 99026 "Final Income Tax Return" for legal entities, filed by the contributor before the National Integrated Service for the Administration of Customs Duties and Tax (SENIAT).
Deadlines for filing pending fiscal years
Both contributors with regular fiscal years (i.e., from 1 January 2024 to 31 December 2024) and contributors with irregular fiscal years that began before 1 April 2022 will have until 30 June 2024 to file the pending individual tax returns. Failure to comply with this deadline may result in fines and late payment interest.
The pending Contributions will be compared, to determine the average monthly contributions, in accordance with the Final Income Tax Return filed by the contributors for 2024, regardless of whether the pending month belongs to the year 2022 or 2023.
Proof of payment and electronic certificate of solvency of the monthly contribution
The payment of the Contribution will be attached to a proof of payment that may be required for the contributors to carry out procedures before different entities of the Public Administration.
The electronic certificate of solvency of the monthly contribution will be issued during the second trimester after the closing of the immediately preceding fiscal year.
Fines and penalties
For legal entities, public or private, that fail to comply with (i) the deadline established for paying the Contribution estimates or (ii) registration in the SIDCAI system of FONACIT will be fined 50% of the Contribution amount due for that month, alongside with the applicable late payment interest, unless exemptions of liability are duly proven by the contributor.
Likewise, the Ruling establishes that the penalties set forth in the LOCTI will apply for failure to pay the contribution within the periods established, and these penalties will be 50% of the monthly estimate of the Contribution and 50% of the total or partial amount of the estimates (due or not) that have been verified by FONACIT during the second trimester following the closing of the previous fiscal year.
We remain at your disposal should you require further details or explanations on the general aspects of the Ruling that were highlighted in this alert and for any related queries.
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1 Administrative Ruling No. 015-004-2024, whereby the regulations establishing the procedure for the assessment, self-assessment, payment and monthly return filing of the contributions for science, technology, innovation and their applications are issued. Published in the Official Gazette No. 42813 from 5 February 2024.
2 Organic Law for the Partial Reform of the Decree with Status, Validity and Force of Organic Law on Science, Technology and Innovation, published in Official Gazette No. 6693 Extraordinary on 1 April 2022.
