Reminder- Do You Have an IMMEX Level “A” Certification? It’s Time to Renew.

by Scott Sneckenberger and Julio Valdez on August 31, 2015

Back in October 2013, the Mexican government published a few revisions to the IMMEX decree, including requiring participating companies to obtain a certification in order to qualify for certain tax and customs benefits. If your company received a Level “A” certification during 2014, it’s only valid from January 1, 2015, through December 31, 2015. You’ll need to renew the certification by filing a Notice of Renewal, 60 days prior to the certification’s expiration.

The Mexican authorities recently clarified that the 60-day window refers to 60 business days. This means your deadline to submit the Notice of Renewal on the government’s website (“VUCEM” for its acronym in Spanish) is September 25, 2015. The Notice of Renewal online portal is expected to be online soon. Companies failing to meet the renewal deadline will be required to submit a new IMMEX certification request, which will likely delay the process and lead to other unintended consequences.

Have an “AA” or “AAA” certification? Don’t worry—those don’t expire until December 31, 2016, and December 31, 2017, respectively. Therefore, no action is required at this time.

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Intellectual Property May Soon Be Deductible

by Jennifer Zamarin on August 25, 2015

What if we told you that you could deduct 71 percent of your company’s income derived from qualifying intellectual property (IP)—that patents, inventions, formulas, processes, knowhow, computer software, and any other IP could qualify?

Thanks to the Innovation Promotion Act of 2015, that could soon be the case. Charles Boustany and Richard Neal, two members of the U.S. House Ways and Means Committee, have drafted a proposal whereby American businesses could benefit from a lower tax rate on income derived from qualified IP. Boustany and Neal have proposed creating an “innovation box,” similar to the “patent box tax” systems used in other countries, which will lower the tax rate for IP-related income.

Boustany and Neal are proposing for corporations to deduct 71% of their income derived from qualifying IP, which would translate into an effective tax rate of 10.15% on all innovation box profits. This is a big stride in the effort to keep and attract IP development in the United States.

The Act is still in the proposal and developmental phase, but the “innovation box” method of taxation would be a significant tax benefit to U.S. companies with profits from IP. And many companies would be incentivized to keep their research and development facilities and IP in the United States rather than overseas where this concept is already in effect.

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Currency Instability Exposes Accounting Policy Weaknesses

August 6, 2015

Economic volatility in Greece, Russia, Venezuela, Brazil, and other major countries has decreased demand for many local currencies and increased the demand for U.S. dollars. This has resulted in a devaluation of most major currencies over the last 12 months: 8 percent for the British pound, 19 percent for the Canadian dollar, 21 percent for […]

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China Eases Restrictions on the Currency Control System

May 26, 2015

On March 30, 2015, the Chinese State Administration of Foreign Exchange (SAFE) eased its restrictions on the currency controls system. This means an increase in the flexibility of Foreign Invested Enterprise (FIE) currency management in China, with an aim to allow companies to settle their foreign exchange capital and to hedge currency risks. Briefly, the […]

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New Non-Tax International Reporting Requirements – Due May 29

May 21, 2015

In November 2014, the Bureau of Economic Analysis (BEA) updated the filing requirements related to their Benchmark Survey, the BE-10 Survey.  It is now mandatory for U.S. companies that own a foreign affiliate (had direct or indirect ownership of at least 10 percent of the voting stock) to complete the survey. This survey is done […]

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Chinese Tax Authority — Policy Reminder on Accelerated Depreciation of Fixed Assets

February 4, 2015

The Chinese Tax Authority issued a new policy on accelerated depreciation of fixed assets to promote technology innovation and economic development in China (Circular 75).  This policy expands the scope of fixed assets that are eligible for accelerated depreciation methods for corporate income tax (CIT) deduction purposes.  This new policy allows manufacturing companies to accelerate […]

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New Joint Initiative – U.S. & Canada to Share Information on Individuals Crossing the Border

November 18, 2014

The United States and Canada recently announced an initiative to track individuals crossing the border for both work and for personal reasons. The initiative will track the number of days a resident of one country works or stays in the other country during a calendar year. The foreign individual will have their days in Canada […]

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China Tax Authority – Outbound Payments Under the Spotlight

November 13, 2014

The Chinese tax authorities have enhanced their efforts to monitor intra-group outbound service payments and royalty charges. In July 2014, the highest tax authority in China, the State Administration of Taxation (SAT), released the “Notice of Anti-Avoidance Examination on Significant Outbound Payments.” In this notice, the SAT instructs the local tax bureaus to launch comprehensive […]

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Straight Talk on Inversions

October 31, 2014

The corporate structuring transaction known as an “inversion” has been front and center recently regarding U.S. corporate tax policy. Corporate inversions typically involve the acquisition of a U.S. corporation by a foreign corporation, during which the U.S. corporation’s shareholders acquire a majority interest in the “acquiring” foreign corporation. The transaction benefits corporate groups that earn […]

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Straight Talk on Inversions

October 10, 2014

The corporate structuring transaction known as an “inversion” has been front and center recently regarding U.S. corporate tax policy. Corporate inversions typically involve the acquisition of a U.S. corporation by a foreign corporation, during which the U.S. corporation’s shareholders acquire a majority interest in the “acquiring” foreign corporation. Read more at plantemoran.com. If you have […]

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