Tax inspections often They arise due to discrepancies between the amounts invoiced and the declared benefits. When a parent company reduces its profits by computing excessive expenses of its foreign branches in a disorderly manner, a situation is created tax risk.
In Noega Engineers, understood the importance of an adequate distribution of costs between the headquarters and the branches to avoid tax problems. Therefore, when the company was already operating in Ecuador through a branch, it asked us for help to guarantee compliance with local and international tax regulations.
We advise Noega Ingenieros on various aspects, including the consideration of permanent establishment, the tax deductibility of certain expenses and the correct allocation of costs between the Spanish parent company and the Ecuadorian branch.
Additionally, we design tax strategies that allowed a better distribution of income obtained in Ecuador, minimizing the tax burden in both Ecuador and Spain. This included the detailed analysis of payments abroad, the consideration of permanent establishment for the execution of works of a certain duration and the analysis of taxation according to the Agreement between Ecuador and Spain to avoid double taxation.
If your company seeks to optimize its taxation in different countries, analyze the taxation of cross-border sales and services, or needs international tax advice, we are the solution you need. Contact us to request our services international taxation and lead your company to success in Latin America.
David Sota, international tax consultant approved by Asturex.
