For income tax purposes, the following entities, among others, are considered as resident entities in Peru:
- Corporations duly incorporated in Peru.
- Branches, agencies, and PEs in Peru of non-resident individuals or entities.
- Partnerships and limited liability companies.
Permanent establishment (PE)
According to the PITL, a foreign company is considered a PE if:
- it has a fixed place of business through which it carries out business activities in whole or in part
- an individual has a power of attorney of the foreign entity and uses it on a regular basis to sign agreements on behalf of the foreign entity
- the person with power of attorney of the foreign entity keeps within the country inventory and/or goods to be negotiated in Peru on behalf of the foreign entity
- works or construction projects, installation or assembly, as well as the supervision activities related to them, have a duration that exceeds 183 days, unless a lower term has been established through a Double Tax Treaty (DTT), in which case, that would be the applicable term, or
- services, when they are performed in the country for a same project, service, or for a related one, for a period or periods that in total exceed 183 days within any given 12-month period, unless a lower term has been established through a DTT, in which case, that would be the applicable term.
PEs must comply with all the formal and substantial tax obligations of any domiciled taxpayer. If a PE presence is determined, then the tax contingency will have to be quantified by calculating the taxes, fines, and interest accrued as from the moment in which the PE presence can be deemed, except for the period barred by statute of limitations.