Comparative Guides
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Results: 4 Answers
Corporate Tax
3.
Investment in capital assets
3.1
How is investment in capital assets treated – does tax treatment follow the accounts (eg, depreciation) or are there specific rules about the write-off for tax purposes of investment in capital assets?
 
Argentina
Depreciation is applied to capital assets, which are deductible from gross profits to determine the income tax base. These include buildings and other constructions and maintenance expenses, such as movable property. Movable property annexed to real estate whose useful life is less than 50 years may be amortised separately.

Depreciation method for real estate: As depreciation of buildings and other constructions on properties affected by activities or investments that result in the tax, it is possible to deduct 2% per year of the cost of the building or construction, or of that part of the acquisition value attributable thereto, until such cost or value is exhausted. Amortisation must be made from the beginning of the quarter of the fiscal year or calendar in which the asset has been affected until the quarter in which the value of the assets is exhausted or until the quarter immediately preceding that in which the goods are sold or alienated, or the activity or investment is discontinued.

Depreciation method for movable property: The resulting sum will be deducted according to the following rule: the cost of acquisition of the goods will be divided by a number equal to the years of its probable useful life. The result of the calculation is the ‘ordinary amortisation fee’. The update rate determined by the Argentine Tax Department will be applied for the month corresponding to the closing date of the fiscal period that is settled. The amount thus obtained will be the annual deductible depreciation.

This procedure also applies to intangible assets subject to amortisation.

This method does not include agricultural livestock, to which a specific amortisation procedure applies.

For more information about this answer please contact: Francisco Blanco from JP O'Farrell Abogados S.A.
3.2
Are there research and development credits or other tax incentives for investment?
 
Argentina
Yes – there are special regimes to promote investment in mining and oil and gas (in the exploration and exploitation stage).

Law 24,196 provides that the total amount invested in exploration, technical trials, research and other studies to determine the feasibility of a mine may be deducted from the income tax balance.

Law 26,154 establishes promotional regimes for the exploration and exploitation of hydrocarbons. These regimes are applicable both on the continental shelf and in the territories of the provinces, including their territorial seas.

The fiscal benefits common to both regimes are as follows:

  • VAT: Early refund of the tax for investments and expenses incurred in the exploration stage and for investments in the exploitation stage. This benefit is also available to transitory business unions and any other individuals or collective entities that are subject to VAT.
  • Income tax: Expenses on assets and investments made in the exploration stage and investments made in the operating period may be subject to accelerated amortisation in three annual instalments, equal and consecutive from the year in which they are made and insofar as they are activated or investments are enabled.
  • Imports: Exemption from the payment of import duties and any other right, special tax, correlative tax or statistical fee, excluding the remuneration of services, the introduction of capital goods necessary for the activities promoted or parts or component elements of such goods, which are not manufactured in the country.
For more information about this answer please contact: Francisco Blanco from JP O'Farrell Abogados S.A.
3.3
Are inventories subject to special tax or valuation rules?
 
Argentina
See question 3.2

For more information about this answer please contact: Francisco Blanco from JP O'Farrell Abogados S.A.
3.4
Are derivatives subject to any specific tax rules?
 
Argentina
No.

For more information about this answer please contact: Francisco Blanco from JP O'Farrell Abogados S.A.