Tax benefits for the elderly in Ecuador

People over 65 years of age, considered seniors, have at least three tax benefits in Ecuador. Being considered a priority population, they have access to tax cuts, for example.

“In Ecuador, throughout history, there have been cases of older adults with lack of decent income, precarious welfare conditions, mistreated or abandoned by their families and society itself, whose monetary income is so low that it is not even enough to satisfy basic needs for their daily life such as clothing, food, medication and access to communication, “summarized Narciza Yanzapanta Quisingo, in her 2020 thesis called” The tax benefits of the taxpayers of the elderly in Ecuador and the socioeconomic situation in the city of Ambato ”.

How can I clean my credit history in Ecuador?

The benefits they have are:

1) Refund of Value Added Tax (VAT)

This value must be returned within a period of no more than 60 days, as established in article 181 of the Regulations for the application of the Internal Tax Regime Law. You can apply for essential items, such as food, communication, culture, sports, education, mobility, health, transportation, clothing and housing.

“The value to be returned may not exceed the maximum monthly amount equivalent to the current VAT rate applied to the sum of two (2) unified basic remunerations in force in the fiscal year that corresponds to the period for which the return is requested. Upon expiration of the aforementioned term, interest will be paid on the recognized values ​​for the return of the VAT”, Is explained in the publication. For this year, the maximum monthly return is $ 96.

Since this year there are at least four supermarkets in the country that make an automatic refund, after an agreement with the SRI. The idea is that the project is replicated in others.

How will the automatic refund of VAT be made to elderly people for purchases in establishments? Here a tax guide

Steps to follow

1. Present in person, only for the first time, the application in the Internal rents service (SRI) together with the citizenship card. Then the procedure will be done online
2. Attach original invoices with full names and surnames, and citizenship card number
3. By email you will be notified about the payment and the values ​​will be credited to your account

Ecuadorians allocate savings not only to debts but also to their security

2) Reduction of Income Tax

The benefit applies in an amount equivalent to a basic fraction taxed with a zero rate of Income tax, according to article 36 of the Internal Tax Regime Law. “They will also have the right to a refund of the excess payment by the SRI in the event that, when presenting their income tax return, a person over 65 years of age confirms that the advance paid and the withholdings at the source that they have been carried out, they exceed the tax caused ”, the investigation was detailed.

The value of the deduction for the elderly in 2021 is $ 11,212. The procedure is also carried out in the SRI page.

“The bank sold my debt and it doubled”, when can an entity sell the debt of its users in Ecuador?

3) Reduction of property tax on motorized vehicles

They are entitled to a special reduction of $ 8,000 on the appraisal, only for one vehicle of the owner. You must submit, only once, the application to the SRI. In the event that you transfer ownership of the vehicle, you must also notify the institution in no more than 15 days.

If you have a disability, there will be an additional 50% discount on the surplus of the appraisal, as recalled by the Presidency of the Republic in a publication.

How to collect and pay a financial debt to a friend or relative?

Among other benefits that older adults have, there is also the exemption from the payment of procedures in notaries and property registries, according to article 37 of the Constitution; as well as municipal taxes for those people who receive a maximum of five basic salaries and who do not have more than 500 basic salaries in assets or properties. (I)