Agreement 725-2018 Ministry of Finance - Reform of the Invoicing System Regulation 481-2017

To amend Articles 8, 10, 11, 12, 13, 15, 16 and 37 of the Regulation of the "Invoicing System, Other Fiscal Documents and Fiscal Registry of Printing Companies" contained in Agreement No. 481-2017 published in the Official Gazette La Gaceta dated August 10, 2017 and its amendment contained in Agreement No. 609-2017 published in the Official Gazette La Gaceta dated October 2, 2017, which shall read as follows:

OTHER SUPPORTING DOCUMENTS. The following are other supporting documents: 1. Supporting documents issued... 2. Documents issued by banking institutions, insurance companies and others that are under the regulation of the National Banking and Insurance Commission. Other economic activities that are not regulated by the National Banking and Insurance Commission shall be supported with the respective Fiscal Invoices. 3. Supporting documents... 4. Authorized documents... 5. Fiscal Documents recognized by the State, resulting from international treaties and agreements, including Tickets issued by companies for passenger air transportation services that are registered and regulated by the International Air Transport Association. 6. Documents issued... These documents do not require authorization proceedings before the Tax Administration and allow supporting the sales tax credit of the Sales Tax, cost or expense of the Income Tax, Social Contribution of the Cooperative Sector or other tax that taxes net profits or net surpluses in the cases that correspond, provided that it identifies the issuer and purchaser, names and surnames, trade name or corporate designation, discriminates taxes by rates or tariffs and contains the date of issuance.

INVOICE. Format Requirements: 1. Identification data... 2. Denomination of the document... 3. Authorization key... 4. Deadline... 5. Authorized range... 6. Destination of copies... 7. Sequential number... 8. Data of exempt purchaser... 9. Data of the printing company... 10. Discounts and rebates granted.

REQUIREMENTS TO BE COMPLETED AT THE TIME OF INVOICE ISSUANCE. 1. When the sale... a) Name and surnames... b) Registration... c) Date of issuance... d) Detailed description... e) Quantity of units... f) Unit value of the good sold... g) Discrimination of values... h) Subtotals subject... i) Discrimination of taxes... j) Literal denomination of currency... k) Total amount in figures... l) Discrimination of discounts and rebates granted. 2. When the sale...

• a)

  Name and surname...

• b)

  Detailed description...

• c)

  Quantity of units...

• d)

  Unit value...

• e)

  Discrimination of values...

• f)

  Discrimination of taxes...

• g)

  Literal denomination...

• h)

  Total amount...

• i)

  Date of issuance...

• j)

  Discrimination of discounts and rebates granted. In both cases... When the sale... 3. To support... 4. When the sale...

ISSUANCE OF INVOICES FOR EXPORTS. In the case of exports with merchandise taxable under the Sales Tax, Obligated Taxpayers must issue the Invoice at zero rate. In the case of companies under promotion regimes for exports, when the raw materials and labor of the exported product are provided by the exporter, an invoice must be issued that consolidates the value thereof. When only labor is provided by the exporter, the value to be recorded in the invoice is that which corresponds to such concept.

TRANSFER OF MERCHANDISE WITHIN AND BETWEEN FREE ZONES. 1. The transfer of merchandise within and between free zones, which does not constitute transfer of ownership, must be carried out using an Official Declaration accompanied by a remittance guide. Companies providing this service at no cost must use this mechanism. 2. Free zone companies that provide transformation service at some cost must issue an Invoice in accordance with what is established in Article 12 of this Regulation and return the transformed merchandise to the other free zone by means of a remittance guide. 3. The transfer of merchandise within and between free zones that constitutes transfer of ownership and is carried out using a Single Customs Declaration (DUA) must be accompanied by an invoice. 4. In the case that free zone companies receive raw materials from their clients abroad, such companies must issue the invoice only recording the value of labor and carry out the export with the corresponding customs document. 5. The invoice that must be issued in accordance with what is described in Numerals 1 and 2) must comply with the requirements established in subparagraphs a) b) c) d) j) and k) of Numeral 1 of Article 11 of this Regulation. Subparagraph b) is only applicable when nationalizations of merchandise produced under the Free Zones Regime are carried out. Sales that are made between legally authorized free zones must be documented only with an invoice without charging Sales Tax nor exempt purchase order. 6. To provide the service of transfer of merchandise within and between free zones, the carrier must issue an invoice at zero rate. 7. To carry out transfers of samples within and between free zones, a remittance guide must be issued and in cases where the transfer is made outside the country, the equivalent customs document must be used.

PRE-VALUED INVOICE. Format Requirements. 1. Identification data... 2. Denomination of the document... 3. Authorization key... 4. Deadline... 5. Total amount... 6. Sequential number... 7. Authorized range... 8. Destination of copies... 9. Data of the printing company... 10. Discrimination of discounts and rebates granted.

USE OF PRE-VALUED INVOICE. The Invoice... The Invoices... The Obligated Taxpayer, through the certified printing company, must request the specific quantity of Pre-valued Invoices that it intends to use for each of the fairs, events or public spectacles that it carries out, with the total quantity requested being printed. Likewise, the Obligated Taxpayer must notify the Tax Administration with a notice period of no less than ten (10) business days before the date of the fair, event or public spectacle, and must indicate the authorized range of Pre-valued Invoice that it will use.

SUPPORT FOR SALES TAX CREDIT, COSTS OR EXPENSES. To support the sales tax credit of the Sales Tax, cost or expense of the Income Tax, Social Contribution of the Cooperative Sector or other tax that taxes net profits or net surpluses, only the corresponding Fiscal Documents are considered valid, provided that they contain the requirements indicated in this Regulation.

To amend by addition the Regulation of the "Invoicing System, Other Fiscal Documents and Fiscal Registry of Printing Companies," contained in Agreement No. 481-2017 published in the Official Gazette La Gaceta dated August 10, 2017 and its amendment contained in Agreement No. 609-2017 published in the Official Gazette La Gaceta dated October 2, 2017, in the sense of adding Article 76-A, which shall read as follows:

TRANSITION PERIOD FOR RECOGNITION OF INVOICES. Invoices that have been issued up to November 30, 2018, without including requirement 8 established in Article 10 of the Regulation of the "Invoicing System, Other Fiscal Documents and Fiscal Registry of Printing Companies," shall be valid documents to support the Sales Tax Credit and costs or expenses of the Income Tax, Social Contribution of the Cooperative Sector or other tax that taxes net profits or net surpluses. Natural or legal persons that have inventory of pre-printed invoices that do not include requirement 8 established in Article 10 of the Regulation of the "Invoicing System, Other Fiscal Documents and Fiscal Registry of Printing Companies" may continue using them until November 30, 2018. Invoices issued under this numeral shall be valid documents to support the Sales Tax Credit and costs or expenses of the Income Tax, Social Contribution of the Cooperative Sector or other tax that taxes net profits or net surpluses. Self-printers and printing companies duly registered in the Fiscal Registry of Printing Companies, as of December 1, 2018, must only issue invoices that comply with all requirements established in Article 10 of the Regulation of the "Invoicing System, Other Fiscal Documents and Fiscal Registry of Printing Companies;" otherwise, their registration as a certified printing company may be canceled.