Observe how to obtain the rate for the invoices:

When adding invoice items, fill out the field Concept (Outbound Invoice Items). Through the field Country (Customer Register) it is filtered only generic and the established country concepts. For that it is used index 1 of CCR table searching for the Concept + Country. By choosing a record from CCR table, the registered rate must be the rate used for tax withholding. If there is no registered rate, the it must be used the rate established in table Variable Taxes (SFB).

If TIO presents IT calculation (RIR tax) the filling of the field Concept must be compulsory.


Note:

The field IT Withh. Agent in Customer Register must be equal to S.

Credit or Debit Notes, calculating IT Withholding

  1. Register a product (there is no specific detail for the registration of this product);
  2. Register a customer and in the field Withholding Agent enter S.
  3. Register a withholding concept in Withholding Concepts Table (CCR), for the RIR tax, entering the percentage in rate;
  4. Register a payment term;
  5. Register a class with the field Tax Apport. Withheld able with the option 1 or 2.
  6. Enter an invoice (credit or debit, for customer or external)with registered product and supplier, using standard TIO created by the System, enter the amount and unit value.
  7. Generate the bill payable.


Withholding Table and Calculation Rule

Check legislation on IT withholding, checking Withholding Concepts Table (AIR) and the percentage to withhold income tax, in the acquisition of goods or services:

http://www.sri.gov.ec/sri/potal/main.do?code=3&codeContent=3#anchor4


Calculation Method


Calculation base for IT Withholding = Goods or Services Value – Discounts

Rate = Rate entered in CCR table or the one entered in SFB table

IT Withholding = Calculation Basis * Fee


Example:

Good sold: 800.00

Discounts: 10.00


Withholding calculation base: 790.00

Fee: 2%

IR Withholding: 15.80


Invoice Total: 790.00

Trade note total: 774.20 (for inflow)

Total withholding certificate: 15.80

* for the outflow the trade note value is 790.00 and the 15.80 will be written-off when the customer delivers the withholding certificate.


To divide the invoice in installments, withholding value can be deducted in the first installment or apportioned among them all. Configure the field Tax Apport. Withheld with:

  • Option 1 - deduction in the first installment;
  • Option 2 - apportioned in all installments.


Note:

On freight, insurance and accessory expenses, withholding value is calculated separately, which means, there is in withholding table a separate rate for each one of this item. By equatorial rule, they are entered as items/services in the invoice.


Withholding Certificate


Operations with suppliers usually generate certificates, which means, only in the inflows.

According to the Ecuadorian legislation, the taxpayer has 5 days to issue to the certificate, as of the invoice issue.


Tip:

In the outflows, it is necessary to receive the certificate document, however, the customer also has 5 days to deliver the document.


Certificates are controlled by the System and must be registered in order to generate a deduction bill of this financial certificate. The invoice is no longer pending on the certificate. So, each invoice presents a withholding certificate.

In this case bill value is always in total value and presents deduction bill if the customer delivered the certificate properly.


Withholding percentage is established in the Variable Taxes table, with corresponding description and withholding code:


Canceling/Return

In the event of return/canceling of a total or partial value of services installments, it is generated Debit or Credit Notes (Invoicing) or Debit or Credit Notes (Purchases), depending on the case. These debit or credit notes will be used in the calculation of tax to be paid.



See Also