In more detail
TU is a referential value created by the OTC in 1994 to update tax bases, fees, fines and similar tax concepts according to the annual inflation. The SENIAT, upon the approval of the Permanent Commission of Finance of the National Legislative Assembly, is supposed to adjust the TU based on the variation of the National Consumer Price Index published by the Central Bank of Venezuela for the prior year. Upon the OTC reform in 2020, the TU would not further be a referential value to determine fines applied under the validity of such OTC.
On 20 April 2022, the Service adjusted the TU value from VES 0.02 to VES 0.40, through Administrative Guidelines No. SNAT/2022/000023 ("Administrative Guidelines") published on the Official Gazette No. 42,359.2 As in earlier instances, the Service adjusted the TU without the National Legislative Assembly's previous approval.
The TU adjustment will only apply for the determination of national taxes administered and collected by the Service, such as IT, VAT, HNWT, tax on large financial transactions (FTT), inheritance tax and gift tax, when applicable. Other public entities are not authorized to use the TU adjustment for determining labor benefits or administrative fees and special contributions. In turn, fines determined by SENIAT prior to the entry into force of the OTC reform in 2020, based on the TU value at the moment the infraction took place, will have to be paid according to the current TU value (i.e., the TU value at the time of the payment, as set forth by the OTC).3
According to the OTC and the Administrative Guidelines, the new TU value will serve as reference for IT and HNWT for fiscal years ending after 20 April 2022, as well as for VAT fiscal years beginning after the referred date. Other relevant implications of the TU adjustment are the following:
| Item |
Former TU value = VES 0.02 |
Current TU value
= VES 0.40
|
|
Maximum IT rate:
(Individuals, Tariff No. 1: 6,000 TU)
(Legal entities, Tariff No. 2: 3,000 TU)
|
Individuals:
34% on the portion of net income over VES 120
|
Individuals:
34% on the portion of net income over VES 2,400
|
Legal entities:
34% on the portion of net income over VES 60
|
Legal entities:
34% on the portion of net income over VES 1,200
|
| Minimum net income required for individuals to file IT returns (1,000 TU) |
VES 20 |
VES 400 |
| One-off IT deduction (desgravamen único) for individuals (774 TU) |
VES 15.48 |
VES 309.6 |
| Personal and family tax rebates (10 TU for each rebate) |
VES 0.2 (for each rebate) |
VES 4 (for each rebate) |
| Revenue stamps to be placed on each page of documents to be filed with authorities (0.02 TU) |
VES 0.0004 |
VES 0.008 |
| Minimum amount of net worth of individuals and legal entities required to qualify as a taxpayer of HNWT (150 million TU). |
VES 3 million |
VES 60 million |
We remain at your disposal if you require further detail or explanation about the Administrative Guidelines or the general aspects highlighted in this report.
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1 Organic Tax Code, Official Gazette No. 6,507 Ext. published on 29 January 2020.
2 Administrative Guideline No. SNAT/2022/000023, Official Gazette No. 42,359, published on 20 April 2022.
3 According to the Organic Tax Code of 2014, repealed by the OTC in 2020:
"Article 91: When the fines established in this Code are expressed in tax units (TU), the value of the tax unit in force for the time of payment shall be used.
Article 92: The fines established in this Code, expressed in percentage terms, shall be converted to the equivalent of tax units (TU) that correspond at the time of the commission of the offense and shall be paid using the value of the same that was in force at the time of payment."
