Natural persons may present the Annual Sworn Declaration of the Income tax 2022, as of March 6, 2023, as provided by the Sunat.
In this regard, Giorgio Balza, principal associate of Cuatrecasas, explained that this obligation applies to any person who has domiciled status in the country for tax purposes and who receives income from work from a Peruvian source and/or income from a foreign source.
Those domiciled subjects who only receive fifth category income and who do not determine a favorable balance, as well as non-resident subjects for their Peruvian source income, are not obliged to present the declaration.
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Balza added that, according to the local tax framework, everyone is entitled to the general deduction corresponding to 7 Tax Units (UIT). Therefore, workers are free to pay taxes for the first S/32,200 they receive for a whole year. It is worth mentioning that, by 2022, the value of a UIT was S/4,600.
In detail, those who determine debt to be paid or carry balances in favor of previous years and apply it against the tax or have used said balances against interim payments for fourth category income during 2022 are required to carry out the annual DJ.
Foreign source income
Regarding those who receive income from a foreign source, Balza explains that these must be added to work income, after applying the corresponding deductions. The result of this sum will be the tax calculation base.
“It must be taken into account that income from a foreign source is generated by all those people who perform physical work outside Peruvian territory (regardless of where their employer or whoever hires them is located) and/or from the returns on their investments abroad.”, Balza specifies.
For example, those people who, through applications and virtual platforms, invest in shares, bonds, investment fund certificates, among other assumptions, which are issued by foreign companies, can generate capital gains (from the sale of their assets), interest, dividends or any other return on your invested capital“, Add.
In this sense, all those people who receive income from a foreign source must present their annual declaration and add them, if applicable, to the income from work from a Peruvian source to calculate the tax.
deductible expenses
If there is a balance in favor, the taxpayer may request a tax refund with the presentation of the annual declaration or wait for the ex officio refund that will be made as of April 12, 2023, Balza mentions.
“The refund corresponds to people with fourth category work income (independent workers) and/or fifth category (that is, payroll workers), who made deductible expenses between January and December 2022.″, he adds.
Likewise, the specialist specifies that the total sum of additional expenses for which the taxpayer can request a refund must not exceed the value of three Tax Units (UIT). This is equivalent to S/13,800.00 for 2022.
“These three UITs fall on gross work income -which is deducted by default by the employer in the case of workers on the payroll-, as long as they fit into some expenses established by the Sunat”, emphasizes Balza.
The tax administration contemplates nine types of expenses for which natural persons with fourth or fifth category income can deduct from their annual Income Tax payment and request a refund.
Consumption in restaurants, bars and hotels is one of them. “The taxpayer can deduct up to 25% of their consumption made in said establishments”says Balza.
In addition, rental expenses (up to 30% of the total cost), professional fees of doctors and dentists (30%) and contributions to Essalud for hiring domestic workers can be deducted.
The regulation also contemplates expenses related to the tourism sector. “50% of the total cost that the person has had in tourist guide services and adventure tourism, ecotourism or similar services can be deducted. Also, 50% for the services of artisans and 25% for travel and tourism agencies.”, specifies the lawyer.
Lastly, Balza recalls that these expenses must have been paid by December 31, 2022. “If the service was contracted at the end of December 2022 and the payment was made during the first days of January 2023, it is no longer considered”, points out Balza.
Finally, the lawyer warns that there are expenses that are automatically identified by Sunat, but others need to be entered manually. For this reason, he notes, it is important that the taxpayer have the documents that corroborate that he carried out said transactions.
