Ecuador: Tax developments in response of COVID-19
General Information
This page offers an overview of tax developments being reported globally by KPMG member firms in response to the Novel Coronavirus (COVID-19).
The content will be updated on a regular basis. However, due to the fast-moving pace of change, it may not always reflect the most current developments in a given jurisdiction. Please refer to the date of accuracy and refer to the relevant links, under additional information, for original source information.
Date accurate as of: 11 May 2020
A presidential decree was issued on March 16, 2020, establishing the state of emergency applicable in all the Ecuadorian territory. Several measures have been issued as a result, including:
- The term for filing annual Corporate Income Tax returns (from April 10th to April 28th) and monthly VAT returns have not been modified.
- However, the payment of the Corporate Income Tax for fiscal year 2019 and VAT for the months of April, May and June 2020 can be deferred in 6 instalments for the following taxpayers:
- Small business
- Entities with who are domiciled in Galapagos, for tax purposes
- Airlines
- Entities in the tourism sector (lodging and food & beverages)
- Agricultural sector
- Usual exporters of goods
- A self-withholding Income Tax (IT) of 1,75% over monthly taxable income has been established for financial entities and entities that provide mobile phone services.
- An self-withholding IT of 1,5% over monthly taxable income has been established for entities that have subscribed exploration and exploitation of non-renewable resources and hydrocarbons agreements, entities that have subscribed specific work agreements, entities that provide complementary oil services and entities that transport crude oil.
- The terms of all tax administrative processes and the statutes of limitation for collection actions are suspended from March 16th to March 31st (both days included).
- For the compliance of other tax formal obligations, such as the filing of Tax Annexes, deadlines have been extended.
Tax relief measures recently implemented:
- Payment of corporate income tax for fiscal year 2019 and VAT for the months of April, May, and June 2020 can be deferred and paid in six installments by certain taxpayers
- An extension of certain tax formal obligations and compliance deadlines.
Suspension of Tax Audits
- The terms of all tax administrative processes and the statutes of limitation for collection actions are suspended from March 16 to March 31 (both days included).
