It continues to be a subject that generates many doubts from both local and foreign investor. According to current legislation, The capital gains tax defines them with a simple taxable event.

“Does your patrimony increase as a result of the increase of any of your assets?” If yes, your executed transaction is subject to the capital gains tax.

Having understood the above, knowing that you have to pay the tax is simple; how to pay it, how to calculate it, when to pay it, and what implications a transaction entails afterward is the complex part.

To exemplify the complexity of paying capital gains tax, let’s look at the following example: The sale of a real estate property may be subject to a tax rate of 2.25%, 2.5%, 15%, and 30%. In other words, we are in the presence of 4 different tax rates for the same generating event.

How do we know which rate applies? More questions must be answered to know which tax rate applies in a transaction; we must know who sells, what their fiscal domicile is, what economic activity they perform, and how many goods they have sold in the last fiscal period. Knowing these answers, we can finalize the rate that applies to a transaction.

Executing a transaction and not paying the tax correctly can even mean a fine of 150% of the unpaid tax.

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