One of the most relevant changes in the Federal Fiscal Code for this 2020 is the addition of Article 5-A related to the term “business reason”.<\/p>\n
Business Reason means when in an act or transaction the reasonably expected economic benefit is less than the tax benefit obtained in that operation.<\/p>\n
An economic benefit is reasonably expected when, among other cases, the taxpayer’s operations seek to generate income, reduce costs, increase the value of the owned assets, improve its market positioning, that is, there must be a business motive to conduct any operation.<\/p>\n
Tax benefits are attained by, among other means, deductions, exemptions, nonrecognition of a gain or accrued income, the crediting of taxes, the reclassification of a payment or activity, a change in the tax regime, among others.<\/p>\n
The article mentions that the tax authority may determine during the performance of its verification powers, unless it proves otherwise, that there is no business reason when the economic benefit is less than the tax benefit and thus disregard the tax effects of these operations.<\/p>\n
Tax benefits are considered to be any of the following:<\/strong><\/span> <\/p>\n Due to these changes having an impact on the 2020 annual return, it is recommended that taxpayers conduct the analysis to determine if the operations carried out during the year lack a business reason, as well as prepare in case it is necessary a file to demonstrate that the operations meant a reasonably expected economic benefit for any business.<\/p>\n Considering the above, in Nu\u00f1ez Rosas y Asociados, we offer our services to support you in the assessment of your operations and the situation of each taxpayer, seeking at all times that you are complying with your tax obligations.<\/p>\n
\n\u2022 Reduction,
\n\u2022 Removal or
\n\u2022 Temporary deferral of any tax.<\/p>\n