Tax In Venezuela

A Contractor's Guide to Taxes : 

One of the most consistently challenging aspects of contracting in Venezuela is complying with the country’s tax system. As well as paying tax in Venezuela, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge. 

How do I calculate my taxable income: 

If you’re working in Venezuela under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Venezuela for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Venezuela, but contractors may not be offered this service because of their short stay with each employer.

Anybody who can’t pay their tax in Venezuela through PAYE is left with the prospect of doing everything themselves.

Do you know much about Venezuelan Tax Law? Does Venezuela have a tax treaty with your home country? You will need to find out or find someone who can help! Income tax in Venezuela can range from 6 to 34 percent, and you need to be sure you are placed in the correct tax brackets.

Tax Calculator: 

If you are a contractor and want a calculation on your tax and net retention in Venezuela, we can supply it to you free of charge.

Using an Umbrella Company for Income Tax : 

Contractors in Venezuela are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Venezuelan umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).

The companies are experts in Venezuelan taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Venezuelan tax office or tax department directly including processing your tax refund if you are eligible.

How We Can Help You with Tax: 

We work with numerous umbrella companies in Venezuela, many of whom are experts in tax and immigration laws. If you have any questions about tax in Venezuela, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Venezuelan work permit.

Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in Venezuela but without the overhead of directly dealing with the Venezuelan tax authorities. Get in touch with us today for some reliable advice on tax in Venezuela!

 

When Do You Need to Lodge Your Tax Return?: 
1 January
Tax Filing Deadline : 
31 March
Can you file it online? : 
Yes, http://contribuyente.seniat.gob.ve/iseniatlogin/contribuyente.do
Currency: 
Venezuelan bolivar (VEF)
Tax-free Threshold in: 
None
Grossed Income: 
Up to 1,000 Tax Units (TU)
Tax Rate: 
6%
Grossed Income: 
1,001 to 1,500 TU
Tax Rate: 
9%
Grossed Income: 
1,501 to 2,000 TU
Tax Rate: 
12%
Grossed Income: 
2,001 to 2,500 TU
Tax Rate: 
16%
Grossed Income: 
2,501 to 3,000 TU
Tax Rate: 
20%
Grossed Income: 
3,001 to 4,000 TU
Tax Rate: 
24%
Grossed Income: 
4,001 to 6,000 TU
Tax Rate: 
29%
Grossed Income: 
Above 6,000 TU
Tax Rate: 
34%
How long does it take to set up: 
230 days
How much does it cost: 
Approximately VEF 220,000 + 1% of initial capital
Is it easy? : 
Starting a Business Rank: 190 (Source: World Bank)
How to File Taxes in: 

Married couples must file a joint return. The process of filing taxes in Venezuela involves the following steps:

Step 1: Register as a taxpayer via the National Integrated Customs and Tax Administration Service (SENIAT) to attain your RIF number. 

Step 2: Register for a username and password to login to the SENIAT portal. To do to this, select RIF as your document type, enter your RIF number and click search. After completing a few security questions, you can create a username and password. Upon completing the registration form, you will receive an email containing your username.

Step 3: Login to the SENIAT portal using your username and password.

Step 4: From the main menu, select Procesos Tributarios (Tax Processes) à Declaración ISLR (Declaration ISLR) à Definitiva (Definitive). Complete a general questionnaire and click continue.

Step 5: Enter the total salaries and wages received during the fiscal year. This includes your ordinary salary/wage and any other remuneration, such as meal allowances, pensions and profit sharing. You are not taxed on any termination benefits.

Step 6: Enter any deductions you may have. Any receipts relating to deductions should be collected. Some key deductions include:

  • Education costs
  • Insurance payments
  • Medical costs
  • Work related expenses

Step 7: Select the portions in which you wish to pay your tax. You can pay the full amount of tax when the return is filed or in 3 equal instalments. In the latter case, the first is due when the return is filed, the second within 20 days after filing and the third within 40 days after filing.

 

A guide for filing taxes is available in Spanish, here

Notes: 

As of 2017, 1 tax unit (TU) is VEF 300.

The above rates apply to residents.

Income for non-residents arising from non-business professional activities is subject to a tax rate of 34% on 90% of gross payments. Salary and income received by non-residents for services performed in Venezuela are subject to a flat rate of 34%.

Does the 183 day rule apply in: 

Yes

When do you become a tax resident in: 

You become a tax resident of Venezuela if you are physically present in Venezuela for more than 183 days in the current or preceding calendar year.

Am I taxed on my global income in: 

Yes, if you are a resident.

Non-residents are taxed on their Venezuelan-sourced income only. 

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