On 19 March 2019, the Peru tax authority (SUNAT) published Report No. 011-2019-SUNAT/7T0000 concerning the determination of expenses and loss offsetting under the controlled foreign company (CFC) rules. The key points include:
- When calculating the net passive income of a CFC, expenses incurred abroad must be determined based on Peruvian tax law and not the law of the jurisdiction of residence of the CFC; and
- CFC losses of a previous year may not be carried forward to offset attributable net…