|
 What is a DNI? Do I need one?
A DNI is Argentina's national identity document. It is a small book, about half the size of a passport, and includes vital information about your identity, including a unique number that identifies you. This DNI number is the rough equivalent of the social security number in the United States.
DNI numbers are requested by all utilities when establishing a new service, by property managers when you rent an apartment, and by merchants when requesting identification during large purchases. When two parties enter into a contract, each party's DNI number is included in the contract, as proof that the parties wished to enter into a contractual relationship. A DNI is necessary to establish a local bank account and receive money transfers from abroad.
Additionally, someone who establishes residency is legally required to obtain a DNI within 90 days of entering Argentina under your new visa. Practically, you will want to obtain your DNI as soon as possible after you arrive. You cannot begin to integrate yourself into Argentine society or conduct business if you do not have a DNI.
After arriving in Argentina, your ARCA Immigration Advisor will accompany you to the appropriate government offices and assist you with obtaining your DNI.
What are CUILs and CUITs? Do I need them?
CUILs (Código Único de Identificación Laboral, or Unique Worker Identification Code) are tax identification numbers that identify individuals for tax purposes. Every legal worker in Argentina has a CUIL and they are required even for people who do not intend to work. A CUIL is necessary, for example, to open a bank account within Argentina, so that the bank can remit taxes on your behalf. Employers require your CUIL so they can properly withhold income taxes from your wage and remit them to the government.
Even if you arrive in Argentina on a pensioner or student visa and you do not intend to work in the country, you will still need a CUIL. Just having a CUIL does not mean you will be required to remit taxes, but the CUIL is required for government and business interactions within Argentina, so it is important to obtain one. ARCA will accompany you to the government office and help you obtain your CUIL.
CUITs (Clave Única de Identificación Tributaria, or Unique Tax Identification Code) are tax identification numbers that are posessed by companies, organizations, or even freelancce woerkers. If you plan on having your own business, working as a freelance worker or independent businessperson, you will likly need a CUIT. Your Argentina tax attorney or accountant can help you obtain a CUIT for your business
I want to start a business in Argentina; what is the tax system like?
Like most developed countries, the tax system in Argentina is very complex and it changes constantly. Different productive activities have different tax rates, which are often influenced by industry lobbyists and the whims of the current government. If you plan to start a business in Argentina, professional tax advice will be a necessity. A few examples of the various taxes in Argentina:
What paperwork do I need?
ARCA can use your residency paperwork that we already have on-file to start the
citizenship process. Your passport and a new criminal records check will be needed
as well. We will inform you of all the requirements once you begin the process.
The paperwork is nothing out of the ordinary.
 Ganancias
Sociedades |
Impuesto
sobre los Capitales |
| Ganancias
Personas Físicas |
Impuesto
sobre debitos y creditos en cuenta corriente |
| Impuestos
sobre Transferencias |
Impuesto
Transferencia de Inmuebles |
Impuestos
de Emergencia sobre Altas
 Rentas |
Impuesto
sobre Bienes Personales |
| Monotributo |
Impuesto
de Emergencia de la Actividad Rural, Yates y Aeronavegantes |
| Monotributo
Autonomos |
Impuesto
sobre los Activos de las Sociedades |
| Monotributo
Seguridad Social |
Aportes
a la Seguridad Social |
| Ganancia
Minima Presunta |
Retenciones
para la Seguridad Social |
| Impuesto
sobre Intereses Pagados |
|
| Impuesto
sobre el Patrimonio Neto |
|
| IVA
- Impuesto al Valor Agregado |
|
Will I owe income taxes in Argentina? I don't want to pay tax in my home country as well as Argentina.
Argentina taxes residents on worldwide income. As an Argentina permanent resident, you pay taxes on income generated within and outside Argentina. However if you do not generate income IN Argentina, then you are not requested to pay taxes over income generated abroad. If you simply want to live in Argentina and you generate income from business assets, investments, private/government pensions that are located in your home country, you will not be required to pay income taxes in Argentina.
If you plan to start a business in Argentina providing goods or services to other businesses located in Argentina, you will owe various local taxes, possibly including income tax. You should consult with an Argentina tax professional to determine what your tax liabilities will amount to.
If you plan on working for an Argentine firm, you will owe income tax if your monthly salary is over $4000 pesos ($1375 USD). The specific rate you pay depends on the amount of income you generate. The income tax is deducted from your salary and paid to the government by your employer. There is no reporting requirement for the employee.
If you are an independent or freelance worker who is working in the local market, you will also owe income tax if your income reaches the $4000 peso threshold. In this case, you will need to fill out a tax form (the form is available online) and turn in the form along with your payment in one of the tax collection shops located throughout the city.
Is there a sales tax or VAT in Argentina?
Yes, Argentina has the IVA (Impuesto al Valor Agregado, or Value Added Tax), which is very similar to a sales tax and identical to the VAT. The IVA is charged to consumers on most goods and services and is remitted by businesses to the national government. It is currently about 21% and most merchants include the IVA in the price of the goods, so you usually do not have to calculate how much tax will be on your purchases.
A few merchants, however, do not include the IVA in their prices. If you ever have any doubts, you should request an invoice from the merchant with a breakdown of the pricing so you can see that the IVA is being applied to your purchase in the correct amount.
Many merchants participate in the "Global Refund" system, which allows foreigners to reclaim the IVA from the government upon leaving Argentina. If you purchase items and plan on taking them with you when you leave the country, you may want to ask the merchant whether they participate in the
Global Refund system so that you may reclaim your IVA upon leaving the country.
I collect social security, a pension, and I'm taking distributions from a 401(k) plan. I would like to move to Argentina. What will my tax obligations be?
Under this situation, we would apply for the Pensioner Visa and show the government that your income is above the $700 USD threshold. Once youreceive your visa and move to Argentina, your bank at home will make monthly transfers to your local bank account here in Argentina.
You will owe a small tax on the bank transfers and the balance you keep in your bank account. These amounts are deducted automatically by the bank and there are no forms to fill.
When you purchase goods, you will pay the IVA (sales tax) of about 21%. Merchants collect this tax and remit it to the government. Typically, the IVA is included in the price of the goods or services, but check with the individual store to make sure.
You will not pay income tax nor will you be required to complete a tax return each year. Unlike the United States and certain other countries, Argentina residents are not burdened with onerous tax reporting requirements. The tax system in Argentina is largely automatic, with the various merchants, employers, and banks deducting what you owe automatically, reliving the resident from dealing with tax preparation
How do I open a bank account?
To open a bank account, you will need to have residency, a DNI, and a CUIT or CUIL tax-id number. There is no way to open a bank account in Argentina if you are not a legal resident. After obtaining your visa, ARCA will also obtain for you a DNI and CUIT/CUIL and introduce you to a local banker who will open your account.
However, we advise all clients not to keep significant sums of money in Argentine banks. It is far safer to keep your wealth at home and transfer only what you need on a monthly basis. There are many reasons we advise clients not to keep a lot of money in the country:
1. Argentina taxes bank accounts and having a high balance will subject you to higher bank taxes.
2. Banks do not pay good interest rates.
3. Some banks require depositors to pay insurance, which is based on the assets of the bank account. Unlike the United States, banks do not offer free deposit insurance here. If a bank fails, you will likely lose your money.
4. On December 21st, 2001, the government froze all bank accounts to prevent a run on the banks, preventing people from withdrawing their bank balances. Additionally, dollar-denominated accounts were confiscated and converted to pesos at an unfavorable exchange rate.
The economic crisis is over now and the banks that are left are generally doing well now. Additionally, with the economy growing and the peso trading freely on exchange markets, the risk of bank freezes has diminished. Nevertheless, it is still a wise policy to keep your wealth outside Argentina. Only bring in what you intend to spend.
How do I bring money into Argentina?
Several of our visas require that you bring a certain quantity of money into the country each month to maintain your resident status. In these cases, this is accomplished via a bank wire transfer. However, this is not the only method to bring funds into the country. We've outlined several of the methods below for bringing in funds:
Bank wire transfer. Your bank abroad will initiate a transfer to your local account here in Argentina. They money is routed through the central bank, which will automatically convert the balance to pesos. Even if you have a dollar-denominated bank account within Argentina, the balance will first be converted to pesos by the central bank. The process takes 3-4 days to complete.
ATM withdrawal. This is perhaps the easiest way to bring money into the country. ATMs are readily accessible throughout Argentina. There are usually no fees imposed by the local banks on withdrawals from bank accounts locatedoutside Argentina. Withdrawing at ATMs will usually result in an exchange rate that is 2-3% higher than the interbank rate. Typically you will receive a better exchange rate from the ATM than you will from a currency dealer.
Travelers checks. If you bring travelers checks with you, they can be changed by most hotels and currency dealers. However, you will receive a better exchange rate by using an ATM machine.
Check changers. If you have a US checking account, some currency dealers and check changers will accept your check and give you cash in return. Fees range anywhere between 1-5%. Some dealers will require your check to clear first. Others will advance you the money up front.
Western Union, MoneyGram. Western Union and MoneyGram are available throughout Argentina. Fees are high and this method is only recommended in emergencies.
Credit cards. Most merchants will accept your credit card. Some may impose a 1-3% fee, however.
ARCA recommends that our clients continue to utilize their financial accounts from abroad. If you are on a visa that requires monthly wire transfers, we recommend that you transfer the amount required by your visa and then bring additional money into the country via ATM withdrawal or by simply using your credit cards. The exchange rates on ATM withdrawals as well as credit card purchases are usually competitive. We do not advise clients to keep large bank balances in Argentina.
How is the Argentine Tax System?
The legislative branch of government (Congress), which consists on the House of Representatives and the Senate, enacts Federal tax legislation. Legislation is generally proposed by the President of Argentina based on studies conducted by the Ministry of Economy.
Tax authorities continuously issue rules that establish practical application procedures or provide information on official interpretations of tax legislation. Provincial and local tax laws are enacted by the legislatures of each province or local govemment and therefore vary among jurisdictions.
Most provinces and local governments issue regulations to assist in the interpretation of their tax laws. The federal tax laws require taxpayers to file annual returns to report their taxable income, determine their tax liability, deduct any taxes withheld or paid in advance, and pay any balance due. Corporations are required to make 11 monthly advance payments of their annual income tax liability. The advance payments are calculated based on a percentage of the previous year´s income tax obligation. An optional system to make estimated payments is available.
The corporate tax return must be filed within five months after the end of he company´s fiscal year.
The tax year for individuals is the calendar year.
Per the article published by Wainstein & Associates, individuals whose sole income is in the form of employee compensation are not required to file an individual income tax return for the year. Instead, their employers are required to withhold income tax monthly, and this tax is considered final. Individuals with significant amounts of non-wage income, such as income from selfemployment, are required to make 5 advance payments towards their final tax liability. These payments are calculated as a percentage of the prior year's income tax and are made bimonthly from June to February. Resident individuals with non-wage income must file an annual income tax return within four months after the end of the calendar year.
Foreign taxpayers not established in Argentina are not required to file a tax return if their income tax liability is fully satisfied by withholding taxes on income from Argentine sources.
The annual return for Value Added Tax is based on the Company's fiscal year. The Tax Bureau (Administración Federal de Ingresos Públicos or AFIP) reviews tax returns to confirm their accuracy and completeness.
Tax officials usually visit the premises of taxpayers to examine books and documents to determine if the taxable bases are correct. However, they make routine visits to monitor compliance with value-added tax obligations.
The appeal procedure for assessments received as a result of a tax audit is divided into phases: administrative and legal.
The administrative phase begins when the taxpayer replies to the notice of assessment (vista). If the taxpayer contests the assessment, but the tax authorities maintain their position by issuing a resolution (determination), the file is forwarded to the tax collector who issues a tax bill (boleta de deuda), unless the taxpayer files an appeal with the same tax authorities or before a special tax court. If the tax authorities' position is confirmed when the administrative phase ends, the tax bill is collectable, and the taxpayer must pay the amount assessed. To contest the unfavorable decision from the tax authorities or the special tax court, the taxpayer may begin the legal phase, after paying the amount assessed, by filing an appeal with a federal district court or the Federal Court of Appeals.) In general, the tax calculation is based on known facts, such as those reflected in the books kept by the taxpayer or in the documentation kept on file. Only in cases when no detailed information has been provided by the taxpayer or no proper books of account are being kept, or the information or records prove to be incorrect or incomplete, the tax authorities may turn to legal assumptions in order to establish the tax obligation of the taxpayer in question. A penalty ranging from 50% to 100% of the underpayment of tax is imposed for failure to file tax returns and for filing inaccurate returns. The penalty for fraud is 2 to 10 times the evaded amount. There are prison penalties for those who committed fraud. This embraces also directors, managers, syndics, members of the statutory audit committee, administrators, agents and representatives of entities involved in the commission of the fraud. There is a penalty interest of 3 % per month for late payments of taxes. The statutory period for assessment extends in principle for five years. There are, however, circumstances that might be examined in each case. For social security taxes, the statute of limitations extends to ten years.
How are foreigners involved in the Argentine Tax System?
Foreigners are involved in the Argentine Tax System only if they participate in the Argentine economy. This means that a person living in Argentina who does not receive a salary, neither has assets, neither produces any kind of income for not having any type of investment, is not participating in any way in the Argentine Tax System and is no required to pay taxes. However, a person who for example buys a property, starts to participate in the Asset Tax, and thus, all assets worldwide will participate in this tax payment as the worldwide tax applies in Argentina.
However, from the taxes that the contributor has to pay, he can deduct what was paid for a similar tax in his country of origin, but this won't originate a balance in the favor of the contributor.
|
