A circular (no. 9/2017) was issued to address the tax implications when assets used in investment projects are sold before the end of the asset’s useful life or are sold before the expiration of a 10-year period in the event that the asset’s useful life is greater than 10 years.
Article 13 of Decree No. 2/012 established that assets that were used in investment projects that were granted tax-favorable treatment had to be maintained for the end of their useful life or for 10 years in the event that the useful life of the asset was greater. If the taxpayer were to sell such assets before the end of their useful lives, there would be taxation for the amount of the tax benefit based on a percentage corresponding to the remaining period of the asset’s useful life. However, if the asset that is sold is replaced by a similar asset, no adjustment would be required, provided that the proper authorization was granted.
The circular sets forth how a taxpayer is to determine the percentage of actual use of the sold asset, for purposes of determining the amount of tax due.
Read a February 2018 report (Spanish) [PDF 572 KB] prepared by the KPMG member firm in Uruguay
© 2018 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.
Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.