The Peruvian Tax Authority is denying deductions for intercompany charges when the Peruvian entity is unable to provide supporting documentation for the costs and expenses incurred by the related party that rendered the services for the Peruvian entity.
In recent tax audits, the Peruvian Tax Authority has challenged the deductibility of intercompany charges.
Background
Legislative Decree 1312, in force since 1 January 2017, amended the Peruvian Income Tax Law by incorporating the following require…