The Federal Tax Authority Expands Information Regime on Local and Foreign Trusts

On April 19, 2012 General Resolution No. 3,293 issued by the Federal Tax Authority (“AFIP”) was published in the Official Gazette, which expands the annual information regime to financial and non-financial trusts implemented by the previous Resolution No. 2,419, which has been repealed.

The new Resolution includes as information agents those who act as trustees, settlors and/or beneficiaries of trusts created abroad, and extends the informing requirement for these cases for the periods 2009, 2010 and 2011. The information to be provided includes, among others, certain information on settlors, trustees and beneficiaries, and the detail and amount in legal tender of the assets.

Those who have already submitted the information regarding fiscal year 2011 must resubmit it in accordance to the terms of the new Resolution.

It also contains the possibility of providing information in person at the corresponding dependence of AFIP in the event it can not be done by electronic system due to limitations in the connection or inoperability of the system.

Additionally, it creates a registration procedure to be performed by:

1. Trustees of trusts created in Argentina.
2. Argentine residents who act as trustees of trusts created abroad.
3. Argentine residents acting as settlors and/or beneficiaries in trusts created abroad, only regarding the operations related to their respective participations.
4. Sellers or assignors and buyers or assignees of participations in trusts created in Argentina.

The operations to be registered are: the creation of the trust and modifications to the constituent contract, the ingress and egress of settlors and beneficiaries, the transfer of participations or rights in the trusts, the allocation of benefits and the termination of the constituent contract, among others.

The deadline for registration is ten days from the execution date of the operation. Moreover, the operations carried out between January 1 and July 1, 2012, must be registered before August 31, 2012.

Failure to comply with this regime could be subject to the application of fines pursuant to the Tax Procedure Law No. 11,683 and impede obtaining, among others, tax credit certificates.