Escrito por:
On November 17, 2025, the President of the Republic issued Executive Decree No. 213, establishing the regulations applicable to donations of new goods, equipment, or supplies destined for the National Police and the Armed Forces, for the purpose of accessing the tax incentives provided under the income tax.
- Tax Benefit
National taxpayers, whether individuals or legal entities, that make donations may obtain a reduction of up to 30% of the incurred income tax, through a tax credit, in the fiscal year in which the donation is completed. However, the tax refund may not be requested in the following cases:
- If no tax has been incurred.
- If the donation exceeds the permitted 30%. In such case, the excess shall be recorded as a non-deductible expense.
For purposes of calculating the limit, the value of the donation shall not be included in the accounting profit.
- VAT Treatment
- The value of the donation includes the total amount of the invoice.
- The VAT paid by the donor in the acquisition of the goods may not be used as an expense nor as an input tax credit.
- Settlement under IRU Regimes
Taxpayers subject to the single income tax (“IRU”) regime who file monthly returns may offset the value of donations made during the fiscal year in each declared period.
This offset shall be limited to 30% of the tax incurred in a full fiscal year.
For these purposes, the tax incurred corresponds to the amount obtained by applying the IRU rate to the taxable base.
- Forms
For the application of the incentive, the tax authority “Internal Revenue Service (IRS)” will publish on its website the Instruction for the Donation of Goods in favor of the National Police and/or Armed Forces, the Letter of Intent, and the Declaration on the Lawful Origin of Donated Goods.
- Considerations
Donations made starting the day after publication in the Official Gazette of the Law for the Strengthening of the Armed Forces and National Police may qualify for the income tax reduction.
For donations made between January 1, 2024, and October 24, 2025, the deduction established under the previously applicable regulations shall apply.
© TobarZVS
This publication contains information of general interest and does not constitute legal opinion on specific issues. Any analysis will require legal advice from the Firm.