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The mandatory annual obligations of your company

When we talk about compliance with the obligations of your company, it means being in good standing with the established guidelines provided by the government. The business compliance requirements are acquired when you create a company,

The mandatory annual obligations of your company

When we talk about compliance with the obligations of your company, it means being in good standing with the established guidelines provided by the government.

The business compliance requirements are acquired when you create a company, where you also obtain responsibilities. That’s why we summarize the mandatory annual obligations of your company to have everything in order.

Considering the continuous law changes, you should read this article.

Once the incorporation of the company has been completed, you should create a file with the following information and documents:

1) Articles of Incorporation

These are the bylaws of the company.

The articles of incorporation have been filed with the following information:

  • Complete name of the company

  • Legal ID number “Cédula Jurídica”

  • Address

  • Value of the shares

  • Number of shares

  • Managers or Directors

2) Certificates of shares / quotas

These certificates include the value, number and value of the shares.

3) Legal books

 The names of the Legal Books are the following: 

  • Shareholders Registry Book “Registro de Socios o Cuotistas”

  • Shareholders Assembly/ Meetings Book “Actas de Asambleas de Socios o Cuotistas”

  • Board of Directors Meetings “Actas de Consejo de Administración”. *This only applies to Corporations*

The mandatory annual obligations of your company

Immediately, the Notary must provide you the legal books of the company. However, usually the law firms manage and keep the legal books on your behalf.

In the legal books, you will find the shareholders’ information, the agreements of the shareholders and the ones of the directors such as increase of capital, investments, a change in the board of directors, and others.

Therefore, the legal books are essential, and their custody should be a priority for you and the shareholders.

The benefit of having a company, is that through the legal books, the shareholders can proceed remotely, if the client is abroad.

Please be advised that it is a matter of preference, to own assets through a company.

All Companies have compliance obligations (Whether they are active or not)

  • Corporate Tax: Payment of the corporate tax within the first week of January every year.

  • Municipality Tax and Luxury Tax (Solidary Tax): Mandatory for those corporations that own land property(ies).

  • Luxury Tax – Based on the value of the property(ies), mandatory for those corporations that own land property(ies).

  • Yearly Reporting of Assets & Capital: Yearly reporting of assets and capital with the Ministry of Finance (Ministerio de Hacienda). The D101 form is the income Tax Return for inactive companies.

  • Subscription of the company into the Ministry of Finance (Ministerio de Hacienda)  as inactive or active, based on the purpose of the company (D140)

  • Stamp of Education & Culture: Yearly payment of the Education and Culture Stamp. You can find more information here.

  • Registry of Transparency & Final Beneficiaries: Processing of the mandatory registry of transparency and final beneficiaries for corporations once a year. You can find more information here.

  • Annual Shareholder Meeting: Drafting and completion of the annual shareholder meeting for the company.

Active companies have compliance obligations

  • Payment of VAT Tax

  • Payment of Income Tax

  • If you have any permits such as patents, they must be paid.

In case you have an active company, you will need an accounting team to support you.

Failing to comply with the mandatory obligations, can lead to monetary sanctions and penalties.

The Outlier Legal team can perform a free health check to verify the legal status of your company.

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karenulate@outlierlegal.com

Lawyer and Notary Public specialized in corporate law, labor law, and intellectual property. Dedicated to providing corporate advice, with more than 9 years of experience in legal and commercial services, and 4 years as a lawyer.

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