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flag Venezuela Venezuela: Business Environment

In this page: Accounting Rules | Tax Rates | Intellectual Property | Legal Framework | Standards | Business Practices

 

Accounting Rules

Tax Year
Fiscal year may not exceed 12 months, but the first year may be less than 12 months. Taxpayers engaged in commercial, industrial, or service activities may choose a fiscal year that does not coincide with the calendar year.
Accounting Standards
The Venezuelan accounting practice follows the American model quite accurately. The Venezuela Public Accountants Federation (FCCPV) advocates the adaptation of the principles of accounting generally accepted (PCGA) in countries following the International Standard Committee norm (IASC).
Accounting Regulation Bodies
FCCPV
Accounting Reports
To realize a financial analysis, companies have to make out a balance sheet and a profit and loss account which will be controlled and reported to the "Commercial Court" by an independent auditor.
Publication Requirements
All commercial companies of Venezuela have to establish annually some accounting documents:
- The account book
- The stocking account
- The account of expenditures analysis
- The stocking evolution.
Professional Accountancy Bodies
Auditing firms listed by region.
Certification and Auditing
The balance sheet and the profit and loss account made out by the company must be controlled by an auditor (comisario) appointed by the shareholders. The auditor must be a licensed accountant, economist or business administrator.
You can consult an external auditor: Deloitte, KPMG, Ernst & Young, PricewaterhouseCoopers.
Accounting News
De Gerencia: Journal of management and negotiation
IAS Plus

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Tax Rates

Consumption Taxes

Nature of the Tax
Value-added tax (VAT) - Impuesto al valor agregado (IVA)
Tax Rate
Standard rate:12%.
An additional 10% can be charged on certain luxury goods, including high-value vehicles and jewellery.
Reduced Tax Rate
Between 8% and 10%.
Are exempted exports, services of banks, financial institutions and leasing companies, insurance services, the sale of shares and bonds, domestic passenger transport, basic foodstuffs, farming machinery, ships and some education and health services.
Other Consumption Taxes
The importation and national production of cigarettes and tobacco (proportional tax levied at a rate of 70% on the retail price of cigarettes, tobacco, and its derivates) and the commercialisation, and importation of alcohol and alcoholic beverages  to be consumed in Venezuela are subject to excise taxes.

Learn more about Service Providers in Venezuela on Globaltrade.net, the Directory for International Trade Service Providers.

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Corporate Taxes

Company Tax
Progressive rate up to 34%. The system of levy is expressed in tax units (unidad tributaria) that specify tax rates. The value of a tax unit is 90 VEB.
Capital Gains Taxation
Capital gains are taxed as ordinary income at the same rate.
Main Allowable Deductions and Tax Credits
Deductions are possible for: depreciation, net operating losses, payments to foreign affiliates, taxes, charitable contributions.
Other Corporate Taxes
Payroll tax, capital duty, real property tax, social security contributions, stamp duty, R&D contributions, municipal tax.
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 

Country Comparison For Corporate Taxation

  Venezuela Latin America & Caribbean United States Germany
Number of Payments of Taxes per Year 71.0 30.0 11.0 9.0
Time Taken For Administrative Formalities (Hours) 792.0 367.0 175.0 207.0
Total Share of Taxes (% of Profit) 62.7 47.2 46.7 46.8

Source: Doing Business - Last Available Data.

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Individual Taxes

Tax Rate

Income tax Income of resident individuals expressed in tributary units is subjected to tax at progressive rates. The value of a tax unit is 90 VEB.
Up to 1,000 units 6%
1,001 to 1,500 units 9%
1,501 to 2,000 units 12%
2,001 to 2,500 units 16%
2,501 to 3,000 units 20%
3,001 to 4,000 units 24%
4,001 to 6,000 units 29%
Beyond 6,000 units 34%
Allowable Deductions and Tax Credits
Legal deductions include the following:
- school tuition and costs for dependants younger than age 25,
- health-insurance premiums,
- medical, dental and hospitalization costs,
- interest on loans for housing purchase or expansion up to 1,000 units,
- house payment or rental costs up to 800 units per year.
A standard deduction of 774 units may be taken.
Each taxpayer may also deduct 10 units per person and per child.
Special Expatriate Tax Regime
It concerns especially housing, vehicle and relocation allowances, payment of education expenses, cost-of-living and hardship allowances.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of the conventions signed by Venezuela.
Withholding Taxes
Dividends: 0/34%, Interest: 5/34%, Royalties: 34%.

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Sources of Fiscal Information

Tax Authorities
SENIAT
Other Domestic Resources
Venezuela: all national taxes

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Learn more about Taxes and Accounting in Venezuela on Globaltrade.net, the Directory for International Trade Service Providers.

Intellectual Property

National Organizations
Venezuela is a member of the Paris Convention (for industrial property) and of the Berne Convention (authors copyrights). It is however very difficult to implement control in this country, to protect patents, trademarks, designs etc.. It is therefore preferable to register these goods and services within the country. It should also be noted that the country is not a signatory to the Rome Convention (which deals with the protection of artists and interpreters). For more information, please consult the SAPI: Service Autonome de la Propriété Intellectuelle.
Regional Organizations
Venezuela is a member of WIPO (World Intellectual Property Organization) and a member of the WTO. For more information contact the Ministry of Justice.
 

National Regulation and International Agreements

 
Type of property and law Validity International Agreements Signed
Patent
 
Decision No. 486 of September 14, 2000 of the Commission of the Cartagena Agreement on the Common Provisions on Industrial Property
20 years
Trademark
 
Decision No. 486 of September 14, 2000 of the Commission of the Cartagena Agreement on the Common Provisions on Industrial Property
 
10 years, renewable for consecutive periods of 10 years
Design
 
Industrial Designs .
10 years  
Copyright
 
Decision n° 351 of September 17, 1993 of the Commission of the Cartagena Agreement on the Common Provisions on Industrial Property
 
Protection extends to 50 years following the author's death WIPO Copyright Treaty
Industrial Models
 
Industrial Designs .
5 to 10 years  

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Legal Framework

Independence of Justice
Judiciary power is not independent in Venezuela. It is highly politicized and undermined by the chronic corruption.
Equal Treatment of Nationals and Foreigners
A foreigner cannot hope for an equal and fair trial. The same is true for certain socio-cultural cathegories. Together, the fact of being white, rich and having an attorney who knows the wheels of the system well, is still the best defense.
The Language of Justice
The judicial language used in the country is Spanish. 
Recourse to an Interpreter
No.
Sources of the Law and Legal Similarities
The main source of the law is the constitution of 1999. Federal law is applicable uniformly across the country. However, municipalities are the fundamental units of local government in Venezuela and can have some local powers, such as raising taxes, etc.

The country does not adhere to the ICJ (International Court of Justice) jurisdiction.

The country is a member of the OAS : Organization of American States. It is also an associated member of MERCOSUR and of Comuninad Andina: Community of South American Nations.

Checking National Laws Online
Venezuela Legislation
Venezuela Legislation

Learn more about Lawyers and Legal in Venezuela on Globaltrade.net, the Directory for International Trade Service Providers.

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Standards

National Standards Organizations
FONDONORMA, Funds for Normalization and Quality Certification
SENCAMER, National Autonomous Service for Standardization, Quality, Metrology and Technical Regulations
COVENIN, Venezuelan Industrial Norms Committee
Integration in the International Standards Network
The structure managing Venezuelan standardization and norms is composed of two entities: the FONDONORMA (Funds for Normalization and Quality Certification), a private non-profit association, and another body of the Ministry of Commerce, the SENCAMER. This new organism is a member of the ISO (International Organization of Standardization), of COPANT (Pan-American Standards Commission) and of the IQ Net (International Certification Network).

Some importers have met some difficulties: no foreign standard has been recognized and hence Venezuela makes it compulsory to obtain a certificate.

Classification of Standards
The COVENIN has prepared more than 300 compulsory standards as much for the domestic market as for the import market. The institution itself does not exist anymore (replaced by FONDONORMA), but the norms are still referred to as the "Norms COVENIN". FONDONORMA issues a NORVEN seal of quality to local manufacturers for specific products and services.
Online Consultation of Standards
Consult the standards on COVENIN, FONDONORMA.
Certification Organizations
FONDONORMA

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Business Practices

General Information
Kwintessential , Cross-cultural solutions website
Opening Hours and Days
Offices open from 8 AM to 12.30 AM and from 2 PM to 5.15 PM. Weekly days off: Saturday and Sunday.

Banking hours: 8:30 AM to 3:30 PM

Shop opening hours: in general from 9:30 AM to 7 PM or from 11 AM to 10 PM (Monday to Saturday).

 

Public Holidays

New Year's Day January 1
Carnaval February 4 or 5 : date changes according to the year
Holy Thursday and Friday March 20 and 21
Declaration of Independence April 19
May Day May 1
The Battle of Carabobo Anniversary June 24
Independence Day July 5
Simon Bolivar's Birthday July 24
Discovery of the Americas Day October 12
Christmas December 25
 
 

Periods When Companies Usually Close

School holidays Month of August
Christmas holidays From December 24 to January 4
Holy Week End of March
 

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Last Updates: October 2014