Taxpayers should determine whether they will have to register their financial statements. Taxpayers that fail to comply with this new registration requirement may be subject to fines and could have their certificate of good standing suspended.

Uruguay issued Decree No. 156/016 (dated May 30, 2016), which would require certain entities to register their financial statements with the Internal Audit Office once it issues a resolution with the procedures and requirements for registering.

Commercial companies, civil associations or companies, foundations, cooperatives, agricultural associations or companies, nonresident entities registered in the Central Bank of Uruguay (according to Law 18.930 of July 17, 2012) and trusts and investment funds not subject to the Central Bank of Uruguay regulations would be required to register their financial statements when:

— Their income derived from ordinary activities, at the end of the previous fiscal year, exceeds 26,300,000 Indexed Units (approximately USD 2,920,000)

— They earned over 4,000,000 Indexed Units (approximately USD 445,000) in income in the previous fiscal year and at least 90% of the income was non-Uruguayan source income

If the previous fiscal year was less than 12 months, the income would be proportionated to a year. In determining their income, entities would use the indexed unit value determined by the National Statistics Institute at the end of the previous fiscal year.

The Decree would require entities to register their financial statements within 180 days of the fiscal year end, counted from the first day of the new fiscal year. If an entity fails to register by the deadline, the entity would be subject to a fine of 2,000 Indexed Units (approximately USD 220). If the entity fails to register more than once over five calendar years, a fine of 3,000 Indexed Units (approximately USD 330) would apply.

Additionally, entities that fail to register their financial statements would not be allowed to distribute dividends until they satisfy the registration requirement. If an entity distributes dividends without completing the registration requirement, a fine of 125,000 Indexed Units (approximately USD 13,900) would be imposed. If an entity violates this provision more than once over five calendar years, a fine of 250,000 Indexed Units (approximately USD 27,800) would apply.

The Internal Audit Office would report the failure to comply to the Tax Authorities after notifying the entity about the penalty. As a result of the failure to comply, the Tax Authorities would suspend the certificate of good standing.

Financial intermediation institutions, insurance companies, managers of funds and pension savings and securities intermediaries subject to the control, supervision and/or superintendence of the Uruguayan Central Bank would be exempt from the registration requirement.

The Internal Audit Office is expected to issue the resolution containing the procedures and requirements for registering financial statements within 10 days of the Decree's entry into force (May 30, 2016). The registration requirement would apply to commercial companies for fiscal years that close after the first business day following the publication of the resolution issued by the Internal Audit Office. For other entities, the registration requirement would apply to fiscal years commencing after the date the resolution is published.

The Decree repeals Decree No. 253/001, Decree No. 353/001 and any provision contravening this Decree.

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