Act 46-2017 established new rules for remitting Sales and Use Tax payments. As a general rule, the requirement to remit bi-weekly deposits of the SUT is applicable to large taxpayers and taxpayers whose average monthly sales tax deposited exceeds $2,000.

According to law provisions, a merchant subject to the payment of the Sales and Use Tax (SUT) in bi-weekly payments complies with the deposit obligation if the total sum of the two installments deposited during the month is at least:

  • 80% of the Sales and Use Tax determined for said month (current year), net of applicable credits, or,
  • 70% of the Sales and Use Tax remitted during the same month of the preceding year, net of applicable credits.

Every taxpayer required to remit the SUT in bi-weekly installments and fails to comply with such obligation shall be subject to the imposition of a 10% penalty applied to the tax that should have been deposited in biweekly installments, in addition to interest and surcharges.

Determining whether a merchant is required to remit the SUT in bi-weekly installments should be an annual process, based on the total sales during the immediately preceding calendar year. Once it is determined that a merchant is required to make the bi-weekly installments for a calendar year, the merchand should comply with this requirement during the entire calendar year.

For additional information regarding this rule, see Tax Alert 05-17: Bi-monthly Sales Tax Deposit Requirements.

At RSM Puerto Rico, we can advice you regarding this requirement and help your business avoid the imposition of penalties for noncompliance. Please contact our tax advisors at (787) 751-6164 | [email protected] for help or more information.