Tax Newsletter - November 2025

The Gradual System of Penalties for Failure to File Tax Returns is Modified.- Through Superintendency Resolution No. 355-2025/SUNAT, published on November 29, 2025, the graduated system for imposing fines for the infraction specified in numeral 1 of Article 176 of the Tax Code is modified, with respect to the declarations of estimated income tax payments for first and fourth category income and the annual income tax return for income other than third category income.

For this purpose, the following criteria must be taken into account:

Approval and Ratification of the Peru-United Kingdom Double Taxation Convention.- Through Legislative Resolution No. 32496, published on November 12, 2025, the Convention between the Republic of Peru and the United Kingdom of Great Britain and Northern Ireland for the Elimination of Double Taxation with respect to Taxes on Income and on Capital  Gains and for the Prevention of Tax Evasion and Avoidance, signed in London on March 20, 2025, was approved.

Subsequently, the Executive Branch ratified the aforementioned Convention through Supreme Decree No. 051-2025-RE, published on November 21, 2025.

Proof of Use of Loan Funds (RTF No. 05191-4-2025).- The taxpayer obtained a loan to pay off a previously acquired loan used to purchase shares. The funds for this repayment came from a bond issuance by the lending company. SUNAT (the Peruvian tax authority) challenged the tax credit associated with the interest payment, arguing that it was not proven that the loan funds had been deposited into the taxpayer's bank accounts, nor what the funds were used for, and therefore the principle of causality was not met.

To support the deductibility of the interest, the taxpayer submitted: loan and credit agreements, bond receipts, disbursement notifications, settlement letters, and other accounting documents. In this regard, the Tax Court assessed the evidence, in addition to public information regarding the issuance of bonds by the lending company, and concluded that: i) the loan, whose interest had been disallowed, was used to cancel a previous loan; ii) this first loan was used to purchase shares of a subsidiary and to pay dividends to the seller; and iii) the loan effectively entered the taxpayer's equity, through a compensation of liabilities, verified in the accounting records; therefore, it decided to declare said interest justifiable and lift the Administration's objection.

Documentary Support in the Case of Tax Credit Dispute for “Fictitious Transactions” (RTF No. 01305-4-2025).- In this case, SUNAT (the Peruvian Tax Authority) did not question the existence of the purchase transactions themselves, but rather based its dispute on the fact that the suppliers or sellers of the merchandise were different entities from those who issued the payment receipts. Therefore, it invoked subsection b) of Article 44 of the VAT Law.

The Tax Court established that it is necessary to evaluate—jointly—the documentation submitted by the taxpayer in order to determine whether the legal assumption alleged by the Tax Authority was verified. From this evaluation, it was concluded that the taxpayer's supporting documentation demonstrated: i) the relationship with the suppliers (as evidenced by pro forma invoices, purchase orders, acceptance certificates, etc.); ii) the transfer and receipt of goods (as evidenced by delivery notes and internal receiving documents); iii) the destination of the goods, even though this point had not been questioned; and iv) the payment for the operations.

In light of this, the Court decided to overturn the objection, as the supporting documentation confirmed that the purchases did not qualify as fictitious transactions.