Ecuador Corporate Income Tax

Corporate income tax rates and base

The general corporate income tax (Impuesto a la Renta de sociedades) rate is 25%, with higher rates where tax-haven shareholders are involved. Companies are taxed on net taxable profits after deductible expenses.

• General corporate income tax rate — 25% percent (Ley de Régimen Tributario Interno (LRTI))
• Rate with tax-haven shareholders — 28% where non-resident shareholders are in a tax-haven jurisdiction and an Ecuadorian individual is also in the ownership chain percent (Ley de Régimen Tributario Interno (LRTI))
• Reinvestment-of-profits reduced rate — Reduced rate (general rate minus 10 percentage points) on profits reinvested in qualifying productive assets, subject to conditions percent ((approx — confirm conditions)) (Ley de Régimen Tributario Interno (LRTI))
• Tax base — Net taxable income: gross income less exempt income and deductible costs/expenses (gastos deducibles) (Ley de Régimen Tributario Interno (LRTI))
• Income tax advance / minimum — Companies may be subject to an income-tax advance payment regime (anticipo del impuesto a la renta) ((approx — confirm computation)) (Ley de Régimen Tributario Interno (LRTI))

Withholding taxes and filing deadlines

Cross-border payments to non-residents are generally subject to a 25% withholding, subject to treaty relief. Dividends to non-residents are taxed on a reduced base.

• Withholding on dividends to non-residents — 25% applied to 40% of the dividend (effective ~10%) percent (Ley de Régimen Tributario Interno (LRTI))
• Withholding on interest to non-residents — 25% (0% on registered foreign loans within authorized rate limits) percent (Ley de Régimen Tributario Interno (LRTI))
• Withholding on royalties / technical services to non-residents — 25% percent (Ley de Régimen Tributario Interno (LRTI))
• Domestic income tax withholdings — Various rates apply to local payments (commonly 1%–10% depending on the payment type) percent ((approx — confirm by payment type)) (Reglamento para la Aplicación de la LRTI; SRI withholding resolutions)
• Corporate return filing deadline — April of the year following the tax year; specific day determined by the 9th digit of the RUC (Reglamento para la Aplicación de la LRTI)
• Tax treaty relief — Reduced withholding may apply under Ecuador's double tax treaties and the Andean Community (CAN Decision 578) (CAN Decision 578; applicable double tax treaties)