Ecuador VAT Compliance
Ecuador has multiple tax mandates you need to be aware of, including its VAT regime. Your obligations may span multiple regulations, and they can change, so staying on top of the latest developments is vital.
Ensure you are on the right side of Ecuador’s tax mandates with our Ecuador VAT Compliance overview. Bookmark this page to stay current on what’s new.
Table of contents
| Periodic VAT return | Monthly Subjects registered in the general regime will declare the VAT of the operations on a monthly basis within the month following the date of their execution, according to the day assigned to the ninth digit of their RUC |
| Quarterly 28th day of the month following the end of the tax period | |
| VAT rates | 15% 5% in local transfers of construction materials 0% or Exempt |
VAT rules in Ecuador
Ecuador e-invoicing
Like many Latin American companies, Ecuador has a significant electronic invoice regime. It has been compulsory for all domestic taxpayers since 2022, requiring them to issue e-invoices for both B2B and B2G transactions.
Find out more about Ecuador e-invoicing.
Requirements to register for VAT in Ecuador
There is no VAT registration threshold in Ecuador. This means that any organisation that makes taxable supplies of goods or services in the country must register for VAT purposes.
Those looking to register for VAT in Ecuador must submit numerous documents. They must also request a subscription to the RUC Single Taxpayer Registry in person.
Invoicing requirements in Ecuador
There are multiple rules and requirements governing the use of invoices in Ecuador, including:
- Registering with the country’s tax authority, Servicio de Rentas Internas (SRI)
- Once approved by the SRI, issuing e-invoices for both B2B and B2G transactions
- All e-invoices must be sent to the tax authority for validation before sending to the recipient
- E-invoices have to be securely signed with an e-signature to validate the contents
- E-invoices must be in XML format
Penalties for non-compliance with VAT in Ecuador
Not meeting Ecuador’s VAT rules may lead to penalties such as fines, which is why you must stay on top of your requirements.
For example, being late to filing or paying VAT can result in fines of up to five times the amount of VAT owed to the tax authorities.
FAQ
What is the VAT rate in Ecuador?
The standard VAT rate in Ecuador is 15%. This was raised from 13% on 1 April 2024.
What items are zero-rated in Ecuador?
The following are zero-rated for VAT purposes in Ecuador:
- Aeroplanes and helicopters (for commercial use)
- Books
- Exported goods
- Female hygiene products
- Fertilisers and insecticides
- Medicines
- Most agricultural goods
- Water and land transport of cargo and passengers
- Education
- Health services
Can I withhold VAT in Ecuador?
Yes, taxpayers classified by the SRI, credit institutions, insurance companies, and public entities, among others, are withholders.
Can non-residents recover VAT in Ecuador?
Foreign tourists can request a refund of the VAT paid on the acquisition of nationally produced goods by presenting the corresponding requirements in the different service channels enabled.
Do I need a fiscal representative in Ecuador?
Ecuador does not mandate that foreign organisations appoint a fiscal representative for VAT purposes.
What is the VAT threshold in Ecuador?
There is no VAT threshold in Ecuador. Companies selling to Ecuadorian residents are expected to levy 15% VAT on transactions.
What are the submission and payment deadlines in Ecuador for VAT?
Subjects registered in the general regime will declare the VAT of the operations monthly within the month following the date of their execution, according to the day assigned to the ninth digit of their RUC.
What is a VAT number in Ecuador?
In Ecuador, a VAT number is given to a registered individual or company as a unique identifier. The country’s VAT number is 13 digits long, with the first 10 digits comprising a personal identification number.
Solutions for VAT compliance in Ecuador
Ecuador’s multiple tax-related mandates may seem complicated to manage, especially if your organisation operates in numerous countries and jurisdictions. This feeling is often multiplied when considering the evolving nature of rules and regulations.
Sovos can help. As your compliance partner, we handle your tax obligations so you can focus on your business.