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Yearly Declaration of Assets for Corporations

Originally, assets belonging to inactive companies were to be declared by March 2021 using form D-135, also known as "Asset Declaration for Inactive Legal Persons," but the required form changed and now it is form

Originally, assets belonging to inactive companies were to be declared by March 2021 using form D-135, also known as “Asset Declaration for Inactive Legal Persons,” but the required form changed and now it is form D-101 that should be used to present the declaration of normal income that is presented every year by all inactive companies and which is also used to present information such as: assets, liabilities and equity.

If you have a house, a car, a building, a farm or any other property within an inactive company, you must declare it as of next year. This is one of the changes brought about by Law No. 9635 for the Strengthening of Public Finances. It is about greater tax control.

In March 2021 the first income tax return for inactive companies must be filed. These are legal companies which have no economic activity. To do this, you must use form D-101, also known as “Income tax” and mentioned above.

First it is necessary to put down the value of the property and indicate the origin of the funds with which it was acquired. This applies to movable and immovable property. It must be made clear whether it is part of its patrimony or whether there is a mortgage on the property.

This is a figure frequently used by family businesses to inherit shares and not properties, or by marriages so that assets might remain separate without further paperwork. It is also used by many others that don’t want to be so easily traceable. The Treasury (Ministerio de Hacienda) wants to know the details of the purchase of the property to determine if the required taxes were paid at the time of the transaction. If taxes were never paid, the taxpayer could face a fine and penalties.

The non-justification falls on what is known as unjustified patrimony. The expert explained that these types of cases are more common than is believed. Taxation detects it after an examination process or when carrying out data cross-checking. It may be that the seller did report it in their tax return and the buyer did not. Sometimes people do not report it on their income tax return because the asset is not part of their business dealings.

However, if the person can prove that they paid for the property with their salary or other income, there would be no problem. The difficulty is if this cannot be proven. The fine is 20% of the value of the property and interest could be charged.

What if the property was acquired more than 10 years ago? Similarly, the person has to show that they are up to date with the tax obligations on that property.

If a sale took place, 15% is paid on the difference between the sale price and the market price. This is known as capital income, when the tax not paid is equal to or greater than ¢225,100,000, this is not reviewed by the Ministry of Finance but by the Public Ministry. In other words, it would no longer be a tax matter, but a criminal one.

The correct form that must be submitted from now on for the income statement is D101. No longer should anyone use form D135 for these purposes.

The deadline to file the income tax return for fiscal period 2020 is March 15, 2021.

When does the prescription period start?

In accordance with resolution DGT-R-038-2020, the obligation to register with Taxation and file the income tax return applies from the 2020 fiscal period onwards.

Should condominium associations be declared as inactive?

If it refers to the condominium, it is not a legal entity but rather a way of organizing private property and, therefore, it will always be registered with the Real Estate Registry and not in the Mercantile Section of the National Registry. This means that there are no taxpayers of the Income Tax to be declared as inactive.

Unsubscribe a Company from the Ministerio de Hacienda:

The forms that are currently used to unsubscribe a person or company from the Ministerio de Hacienda will be eliminated. They will also remove this option from the TRAVI platform (Trámite Virtual or Virtual Procedure). The new form that must be used instead is the modification form.

Elimination of Companies in the Tax System:

For this specific case, several things must be presented depending on the scenario:

1) If the company is already unsubscribed in the ATV or Virtual Tax Administration Portal (Portal de Administración Tributaria Virtual), this procedure must be managed in the TRAVI platform by choosing the description option (once this option is removed from the platform, it will be a modification). A copy of the liquidator’s identity card is required as is a certification stating the appointment of the curator or liquidator, registered in the National Registry with no more than one month of issuance. It is important to mention that the liquidator has the power to carry out all the aforementioned procedures and does not need a special power of attorney, but if the liquidator is the client and not a third party, a Power of Attorney must be issued to be able to authorize a third party to make these arrangements.

2)  If the company is not listed in the Ministerio de Hacienda, the decryption form must be filled out by the legal representative and this procedure must be managed in the TRAVI platform choosing the description option. A copy of the liquidator’s identity card is required as is a certification stating the appointment of the curator or liquidator, registered in the National Registry with no more than one month of issuance. It is important to mention that the liquidator has the power to carry out all of these aforementioned procedures and does not need a special power of attorney, but if the liquidator is the legal representative of the company and not a third party, a Power of Attorney must be made in order to authorize a third party to make these arrangements.

If the company was dissolved in the National Registry for reasons of liquidation, or if it closed, or was canceled ex officio or canceled, it does not need to present any documentation to Ministerio de Hacienda to be eliminated from the Treasury System.

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kbaldioceda@outlierlegal.com

Paralegal Assistant with customer service certificate. More than 3 years of experience in Real Estate and Paralegal Services. Has worked as an International Customer Service Agent for Delta Airlines USA.

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4 COMMENTS
  • Avatar
    Derryl Hermanutz January 17, 2021

    I have been unable to file the D-101 declaraciones for mis “personas juridicas legalmente constituidas”. I have two corporations. One owns my house; the other owns my car. Both corporations are owned by a Living Trust. I am President of both corporations so I am the legal representative of the corporations. I have a Hacienda user account in my personal name with my DIMEX identificacion. I can access both corporations in my capacity as legal representative in the Hacienda account; and I can access the D-101 for both corporations. As a 960113 I am only required to fill out the Activos and Pasivos section of the D-101. But no matter what numbers I use, when I try to validar the form I get an error message that tells me to refill all of the boxes. In the Pasivos box I show the social capital of the corporation. In the Activos box I have tried showing the purchase price of the house and car; and I have tried showing the Muni’s 2013 assessed price of the house; and I have tried showing the depreciated Marchamo value of the car. But the system will not accept my attempts. Is this because the corporations are owned by a Trust, and the Trustee is the legal representative? Or is it because I need to have a accountant file the D-101 declaraciones? Or is it because I first have to file a D-151 showing the assets that are owned by the corporations? My Hacienda user account does not have D-151 available.

    • Stacey Jennings
      Stacey Jennings February 18, 2021

      This is a very detailed issue – maybe I forward your email and comments to our team? I think it would be the best way to make sure you receive the most qualified assistance.

  • Avatar
    Dave January 19, 2021

    Great article and thanks for clarifying that D101 is to be used now, since I looked and couldn’t find the mysterious D135 that was supposed to be available for this purpose.

    “First it is necessary to put down the value of the property and indicate the origin of the funds with which it was acquired. ”

    I don’t see anything online (ATV) in the D101 though that would indicate where or how we would detail the origin of funds. Is this something done outside of the D101?

    • Stacey Jennings
      Stacey Jennings February 15, 2021

      that works in this way: for example: you have a property and you are paying it to the bank right now
      then:
      in: ACTIVOS FIJOS NETOS, you have to include the value of the property
      and in: PASIVOS: you have to include the value of the mortgage that you have

      This is a VERY simplified example of how it works. If you need additional assistance please contact us and we can help.

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