Procedures for application for VAT Eligible Merchant Certificate in PR

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Tax Update: VAT Eligible Merchant
Certificate Application Procedures Published
On May 3, 2016, the Puerto Rico Treasury
Department issued guidance for the
application of the Eligible Merchant Certificate
(“Certificate”) for VAT purposes in Puerto
Rico. At this moment the PR Legislature has
approved the elimination of the VAT which
was effective on June 1, 2016. The Governor
has expressed his intentions to veto the Bill.
We will continue to monitor the developments
and keep you informed. Since the process to
apply for the Certificate needs to be completed
by May 31, 2016, we provide a summary for
the benefit of those that may be interested in
obtaining the same.
Those merchants that are classified as Eligible
Merchants and hold such a Certificate may
request a refund of excess VAT the month the
excess amounts to more than $10,000. Only
merchants with sales taxable at 0% in excess
of $500,000 in average for a three year period,
will qualify.
Tax Policy Circular Letter 16-03 details the
process and documents needed to submit an
application for the Certificate.
The merchant must file the application no
later than May 31, 2016 in order to be
considered an Eligible Merchant and able to
claim a refund on the June 2016 VAT
Monthly return. In case the application is filed
later, the merchant will be able to claim a
refund starting with the month in which the
Certificate is issued.
Once the application is approved, the
merchant will be able to obtain the Certificate
from SURI. Normally, the Certificate will be
valid for one year, except for this first
Certificate for which CL 16-03 provides
guidance as to its effectiveness.
At Kevane Grant Thornton we will continue
providing up to date information as to the
developments related to the VAT in Puerto
Rico. Contact us should you want to obtain
further information related to this application
or any VAT related issues.
Contact us
For assistance in this matter,
please contact us via
maria.rivera@pr.gt.com
javier.oyola@pr.gt.com
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May 16, 2016