Venezuela

Corporate - Corporate residence

Last reviewed - 09 February 2021

According to the Venezuelan tax code, the following companies are regarded as resident:

  • Companies incorporated in Venezuela and registered with the Mercantile Registry as established by commercial law.
  • Foreign companies registered to be domiciled in Venezuela as branches duly registered with the Mercantile Registry.

The following companies are non-residents but subject to Venezuelan taxes:

  • Foreign companies that provide technical assistance, technological services, royalty items, and professional services from abroad.
  • Foreign banks granting loans to local companies.
  • Foreign companies leasing goods to local companies.
  • Foreign companies deriving income from economic activities carried out in Venezuela or from assets in Venezuela.

Permanent establishment (PE)

According to the Venezuelan Income Tax Law (VITL), generally, a passive party is deemed to be carrying out operations in Venezuela through a PE when:

  • The passive party owns, directly or through an agent, employee, or representative in the Venezuelan territory,:
    • an office, fixed place of business, or an activity centre where its activities are totally or partially carried on
    • management headquarters, branches, offices, factories, shops, facilities, warehouses, stores, construction, installations, or assembling works, when the duration thereof exceeds six months, or
    • agencies or representatives authorised (according to the VITL) to contract in the name of or on behalf of the passive party.
  • The passive party performs, directly or through an agent, employee, or representative in the Venezuelan territory, professional, artistic activities.
  • The passive party possesses, directly or through an agent, employee, representative, or other contracted personnel in the Venezuelan territory, other work places where the operations are wholly or partially performed.

Any agent acting independently shall be excluded from this definition, except if such representative has the power to conclude contracts in the name of the principal.