Puerto Rico transitions sales tax reporting from PICO to SURI

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Puerto RicoTransition from PICO to SURI

Presented By:

Ramon Frias – Tax Counsel

Antonio Di Benedetto – Director of Tax

Proprietary and Confidential the information and materials in this document are not for use or disclosure outside of Sovos Compliance, LLC. except under express written consent.

2 Housekeeping

• Today’s webinar will last for approximately 45 minutes

• Audio for this event will be available via your PC speakers or telephone

• Please type questions in the questions box – these will be answered during our Q&A session if there is time

• The webinar recording and slide deck will be provided after today’s presentation

The information and materials provided in this webinar are for informational purposes only and are not intended as, nor should be deemed as providing tax or legal advice. Attendees should contact a qualified professional to obtain advice with respect to any

particular topic


3 Agenda

Movement from PICO to SURI

New Registration Requirement

New Information Reporting

Sales Tax Reporting Changes

Registration Certificate Change

What are Implications to Taxpayers

COFIM – Local Reporting


Movement from PICO to SURI


5 Movement from PICO to SURI

Overview

• Portal Integrado del Comerciante (PICO)

Puerto Rico Commonwealth sales/use tax reporting system

Sistema Unificado De Rentas Internas (SURI)

Puerto Rico Commonwealth tax reporting system

First phase Sales/Use tax

Later phases include income, payroll, other taxes.

Phase I – Effective for October sales/use tax filings in November 2016.



System SURI Integrates

SURI

PICO

Sales

Tax

Online

Services

System

Bev/

Licenses

Special

Laws

REFO

(Ind Tax

Returns)

Case

Managem

ent (Audit

Selection)

Audit

SAF

(Audit)

PRITAS

(Corp

Income)

Virtual

Income

Tax

Collector



Important Dates for Transition

October 15, 2016 - SURI launched.

October 28, 2016 - PICO decommissioned.

October 28 –October 31, 2016 - Both systems unavailable.

November 10, 2016 - First filings using SURI due.

November 20, 2016 - Second set filings due.

November 20, 2016 - SURI registration needs to be completed.


New Registration Requirement


9 New Registration Requirement

SURI Registration Process

Website to commence registration https://suri.hacienda.pr.gov/_/

Allows for English translation (top right)

https://www.youtube.com/watch?v=Z92GBjlQTeo

https://suri.hacienda.pr.gov/_/




Registration process begins with logging in using PICO username and password Presume user is registered, if not you would create a new profile.

The taxpayer would select if they are a: Registered merchant (previously filed in PICO) You are a registered merchant with the Treasury Department and will log into SURI

for the first time. New Merchant (never previously filed) Start a new business or you are an Authorized Representative registering a new

business. Representative or Authorized Agent An external counsel, CPA, or employee of an active merchant in PICO that will log into

SURI for the first time.




Registered merchant (previously filed in PICO) Need your taxpayer registration number and PIN from PICO

Confirm personal information imported from PICO to SURI

Preferred method of communication (cell, email, phone)

Requirement for security question

Review business registration that are imported.

Determine legal entity name and status/type (C Corp.) and identification.

Verify various portions of address information.

Confirm import/export status of goods and frequency.



SURI Registration Process (Cont.)

Registered merchant (previously filed in PICO)

Closing period of accounting

Financial information – accounting method and system

Payment Methods & Frequency (Cash, Credit/Debit Cards, Checks)

Collection Mechanism (POS, Electronic Billing, Manual Billing)

Certificate used in Business (merchant, mobile, exhibitor, temp business, provisional)

Additional location information (what are providing good/service, etc sales volume from location.

You must select at least one NAICS code for your business (various allowed)

Then confirm information and submit.


New Information Reporting


14 New Information Reporting

Sales per location

Previously report sales per legal entity.

Revised requirement is to report sales by locations in Puerto.

Three categories of location information:

1. Taxable sales;

2. Exempt sales;

3. Returns.

Allows for better traceability of revenue by locality to prevent fraud.


15 New Information Reporting


Sales Tax Reporting Changes


17 Sales Tax Reporting Changes

Previously Puerto Rico maintained the following three forms for sales/use tax reporting:

1. 2915 A, Monthly Sales and Use Tax Return (10.5%)

2. 2915 F, Special Monthly Sales Tax Return (4%)

3. 2915 E, Qualified Pre-Existing Contracts (6%)

Puerto Rico introduced a new return

2915, Monthly Sales and Use Tax Return

Consolidates all of the above reporting into this one new return.

Does not include the sales/use tax on imports.

Requires new information reporting by location.



2915, Monthly Sales and Use Tax Return (cont.)

User can manually enter taxable and exempt sale by location.

Template can also be utilized to upload reporting by location in SURI.

SURI system aggregates and consolidates location information amounts onto main return.

The location information only relates to sales not purchases.

Expanded payments methods to include credit/debit cards.

Due date remains the 20th of the month.



2915 D, Tax on Imports Monthly Return.

The Hacienda is revising this form for the October filing period.

The Hacienda has streamlined and re-ordered the lines on the return.

Combined existing exemption lines onto line 3 with subparts.

Due Dates still remains the 10th of the Month.



Due Dates

Previously guidance

If due date fell on a weekend or holiday, the return and payment would need to be provided on that day, so practically it would be due the previous business day.

Revised guidance

If due date falls on a weekend or holiday, the deadline for filing the return would be extended to the next business day. (Awaiting clarification on payment)


Registration Certificate Change


22 Registration Certificate Change

Registration Certificate

Utilized as a resale certificate for local 1% sales and use tax.

Once SURI registration is complete you will receive an online registration certificate.

If a taxpayer had different business activities you needed a certificate for each activity.

In the revised registration certificate there is a consolidation of the various activities on one certificate leveraging NAICS codes.

Provides level of fraud prevention for sales and purchases for resale.


23 Registration Certificate Change


Implications to taxpayers


25 What are implications to taxpayers

Taxpayers have to ensure they have logged into PICO and retrieved relevant information prior to site decommission.

Taxpayers have to update calculation engine to associate location information for Puerto Rico transactions.

Taxpayers should file Puerto Rico 2915D, Tax on Imports Monthly Return.

Taxpayers should register their organization(s) in the SURI system and retain a copy of the new registration certificate.


26 What are implications to taxpayers

Taxpayers should associate location information to Puerto Rico transactions for purposes of reporting October 2016 sales/use tax filings.

Taxpayers should ensure that you are utilizing the appropriate state level form for reporting (revised Puerto Rico 2915, Sales and Use Tax Return).

In reporting solution, taxpayers should ensure that the new Puerto Rico Form is set up and locations are configured; before commencing reporting process.

In reporting solution, taxpayers should ensure that credits have carried over to the new return.


COFIM


28 COFIM – local reporting

• This has no implication to local reporting.

• This is only state level sales and use tax that is implicated.

• Taxpayers should continue to report municipal sales tax to the COFIM.


Thank you for viewing:Puerto Rico

Transition from PICO to SURI

Presented By:

Ramon Frias – Tax Counsel

Antonio Di Benedetto – Director of Tax

Puerto Rico transitions sales tax reporting from PICO to SURI

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