Libro I Título V. Rentas de no residentes

The obtaining of any taxable income in accordance with the taxable events contained in the preceding titles of this book, by non-resident taxpayers acting with or without a permanent establishment in the national territory, constitutes a taxable event of this tax.

Any transfer or credit to an account to their head offices abroad, without consideration, made by permanent establishments of entities not resident in the country, also constitutes a taxable event of this tax.

The taxpayers of this tax are individual persons, juridical persons, entities or patrimonies, non-resident in Guatemalan territory, according to the definitions of this Book, that obtain taxable income in accordance with the preceding article.

Those who pay the income accrued by taxpayers without a permanent establishment, or the depositaries or administrators of the property or rights of taxpayers without a permanent establishment, are jointly and severally liable for payment of the tax corresponding to the income they have paid or to the income from the property or rights whose deposit or administration has been entrusted to them, respectively.

Income established as exempt in other titles of this book, when applicable, is exempt from this tax.

Likewise, income paid by the State of Guatemala to non-resident entities, as interest or other obligations, is exempt.

Taxpayers who obtain income through a permanent establishment situated in national territory shall be taxed on the totality of the income attributable to said establishment, in accordance with the provisions of the following chapter.

Taxpayers who obtain income without a permanent establishment shall be taxed separately for each total or partial payment or crediting of income subject to levy, with no offsetting between them being permitted.

For non-residents operating with a permanent establishment, the provisions regarding the tax base, tax rate, assessment period and rules for administration of the tax are determined in accordance with the provisions of Title II of this Book, "Income from Lucrative Activities".

As a general rule, for income obtained by taxpayers of this tax without a permanent establishment in national territory, the corresponding taxable income is constituted by the amount that has been actually paid to them or credited to an account.

The tax base corresponding to capital gains is determined in accordance with the provisions of Chapter IV, of Title IV, of this Book.

The tax rates applicable to the payment or crediting of income taxed under this title are as follows:

1.The tax rate of five percent (5%) applicable to:

a.International cargo and passenger transport activities:

i.The value of tickets sold in the country or abroad to be issued in Guatemala, regardless of the passenger's origin or destination.

ii. The value of freight for cargo originating in Guatemala destined abroad, even when such freight is contracted for or paid in any manner outside Guatemala. In the case of freight for cargo coming from abroad, when the value of the freight is paid in Guatemala.

iii. The amount that non-resident persons engaged in transport, as well as their representatives in Guatemala, charge transport users as part of the service they provide, including fuel, storage, demurrage, use of offices at the port, use of electricity or penalties.

b.Insurance premiums, surety bond premiums, reinsurance, retrocessions, and re-suretyship obtained by non-residents.

c.Telephony, data transmission and international communications of any nature and by any means, derived from communications services of any nature between Guatemala and other countries. In all cases, regardless of the place of incorporation or domicile of the companies providing the service.

d.repealed.

e.Dividends, distribution of profits, earnings and other benefits, as well as any transfer or credit to their head offices abroad, without consideration, made by permanent establishments of non-resident entities.

As an exception to the tax rate referred to in cited numeral 1, the tax rate of three percent (3%) shall apply for the supply of international news to user companies in the country, whatever the form of compensation, and for the use in Guatemala of cinematographic films, comic strips, photonovels, musical and audio recordings and any other similar projection, transmission or broadcasting of images or sounds in the Republic, whatever the medium employed.

2.The tax rate of ten percent (10%) applicable to:

a.The interest, within the terms of Article 4 of this Book, paid or credited to non-residents.

The payments or account credits of interest for loans granted by banking and financial institutions to entities duly authorized and regulated in their country of origin, in accordance with the Law on Banks and Financial Groups, are excepted from the tax referred to in this numeral, as well as those granted by the latter and by multilateral institutions to persons domiciled in the national territory.

3.The tax rate of fifteen percent (15%) applicable to:

a.Salaries and wages, per diems, commissions, bonuses and other remuneration that does not involve reimbursement of expenses.

b.Payments or crediting to a bank account to athletes and to theater, television and other public entertainment or performance artists.

c.Royalties, within the terms of Article 4 of this Book.

d.Fees.

e.Scientific, economic, technical or financial advice.

4.The tax rate of twenty-five percent (25%) applicable to:

Other taxed income not specified in the preceding numerals.

Individual persons, juridical persons, liable persons or representatives of entities or patrimonies required to keep complete accounting, in accordance with the Commercial Code or this Book, that pay, credit in a bank account or in any manner place income at the disposal of non-residents, must withhold the tax with definitive character, applying to the established tax base the tax rate indicated in the preceding article of this Book and remit it by sworn return to the Tax Administration, within the time limit of the first ten (10) days of the month immediately following that in which the payment or bank credit in money was made.

The withholding agent must issue a certificate of the withholding effected.

If the withholding referred to in the preceding article had not been effected, the tax must be assessed and paid by the non-resident, by means of a sworn return, within the first ten (10) days of the month following that in which the taxable event occurs. The foregoing is without prejudice to the joint and several liability of the withholding agent.

The withholdings made by withholding agents to the taxpayers referred to in this Title must be remitted to the Tax Administration within the first ten (10) days of the month following the month in which the withholding was made, together with a sworn declaration indicating the name of each of the non-resident taxpayers without a permanent establishment and, of the withholding agent, the Tax Identification Number, the income credited or paid and the amount of the withholding.