Nov 09, 2015
From KPMG TaxWatch
On November 2, 2015, the Treasury Department of the Commonwealth of Puerto Rico (Treasury) issued Administrative Determination (AD) 15-23 providing guidance on the new monthly Sales and Use Tax return (Form SC 2915 F) for professional designated services, business to business, and services rendered by a non-resident, which are subject to Sales and Use Tax (SUT) at a special rate of four percent effective October 1, 2015.The Treasury highlights that the following transactions should be reported in the new return: (1) designated professional services and business-to-business that are subject to SUT at four percent; (2); exempt designated professional services; and (3) accrued SUT at four percent for services received from nonresidents. All other services, including business-to-business services that are exempt or subject to SUT at the standard Commonwealth rate of 10.5 percent, should be reported in the general monthly SUT return (Form 2915 A). The Treasury highlights that all merchants that have a Merchant’s Registration Certificate stating that they qualify as withholding agent (green certificate) are required to file the new return in addition to the general SUT return even if the merchants do not perform transactions subject to the special SUT rate of four percent or there are no reportable transactions during a taxable period. The new return is due on the 20th of the month following the month in which the tax becomes due (i.e., either when it is charged or when it is collected in case of designated professional service providers opting for the cash accounting method). The AD further provides guidelines for the electronic filing of the return through the Treasury’s online portal PICO (Portal Integrado del Comerciante). Finally, the Treasury reminds providers of designated professional services wishing to apply SUT on a cash accounting basis must make an election for this method with the filing of the first return. For more information on Administrative Determination 15-23, please contact Leah Durner at 202-533-5542 or Carlos Molina at 787-370-2340.
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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.
The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.