- Corporate income taxpayers subject to the general regime of the Income Tax Law, that maintain a balance of retained taxable profits accumulated in its taxable income registry (RAI) (including those from the old taxable income fund [FUT]) may benefit from a new substitute tax, which will replace the corresponding final taxes on those profits.
- For balances accumulated at the end of business years 2022, 2023 and 2024, the substitute tax rate will be 10%, with no right to credit. For balances accrued at the end of business years 2025 and 2026, the substitute tax rate will be 12%, with no right to credit.
- Profits subject to the substitute tax must be recorded in the registry of exempt and non-taxable income (REX). The corporate income tax credit associated with profits subject to substitute tax is lost.
- The distribution of profits that have been subject to the substitute tax will not be taxed again at the final taxpayer’s level. They may be distributed subject to the imputation order established in the Income Tax Law, without preference.
- Additionally, a substitute tax at a rate of 15% is established for the balance of reinvested profits (FUR); and at a rate of 32% for excess withdrawals whose final taxation is pending. In both cases the substitute tax may be paid until 2024.
