Puerto Rico: New rules for filing import declarations

Puerto Rico: New rules for filing import declarations

New rules for import declarations and payment of related use tax in Puerto Rico are effective either May 1 or June 1, 2015 (depending on the identification number used by the importer).

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Administrative Determination 15-05 (AD 15-05) (March 26, 2015) repeals a temporary procedure established by AD 14015 for the release of imported property and an alternate procedure for completing and submitting the complementary declaration pursuant to AD 14-20.

New rules are effective May 1 or June 1

The rules under AD 15-05 are effective for importers that do not have a tax bond in place—non-bonded importers:

  • May 1, 2015—for non-bonded importers whose employer identification number or social security number (as applicable) ends in an even number or zero
  • June 1, 2015—for non-bonded importers whose employer identification number or social security number (as applicable) ends in an odd number

Use tax on imported property

The purpose of AD 15-05 is to reinstate a procedure established under Circular Letter 14-06 regarding the declaration and payment of use tax on imported property by non-bonded importers.

Because the alternate procedure previously established under AD 14-15 and 14-20 has now been repealed, non-bonded importers will not be able to arrange for the automatic release of any taxable items imported into Puerto Rico.

Instead, pursuant to the terms of Circular Letter 14-06, non-bonded importers will have to select the bills of lading to be reported during their preparation of the declaration of imports. As such, a copy of the commercial invoice (or alternatively, a purchase order) must be uploaded to the PICO system. The system will then generate a receipt of payment and authorization that will allow the importer to take possession of the imported property.

A declaration of imports will be required for:

  • Taxable property
  • Exempt property
  • Taxable property received by mail (individuals who receive merchandise ordered through the internet will have until the 10th day of the month following the receipt of the merchandise to file a declaration of imports)

The declaration of imports will need be completed and filed electronically no later than the 10th day after the month following the imports.

Notably, a bond will not be required under AD 15-05. The bond is simply a mechanism that will facilitate deferral of the date for paying the sales and use tax until the 10th day of the following month after receiving the merchandise.

Payments of the sales and use tax must be made electronically through the PICO system through an ACH debit or credit. Bonded importers may use the bond to defer payment until required.

 

For more information, contact a tax professional with KPMG in Puerto Rico:

Rolando Lopez | +1 (787) 622-5330 | rlopez@kpmg.com

Carlos Molina | +1 (787) 622-5311 | cmolina@kpmg.com

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