Countries › Peru › Guide › 5. FX and capital controls › Foreign loans to Peruvian companies: no central bank filing, mandatory bank channel, 4.99 or 30 percent withholding and the interest deduction cap
Foreign loans to Peruvian companies: no central bank filing, mandatory bank channel, 4.99 or 30 percent withholding and the interest deduction cap
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Last verified: 2026-10-28 · Status: Stable
A Peruvian company can borrow abroad in any currency without central bank approval or registration, but every loan disbursement and repayment must pass through the financial system whatever the amount. Interest paid abroad bears 4.99 percent withholding when the lender is unrelated, the money entered Peru and the rate stays within the lender market prime rate plus three points; interest to a related lender, or on loans that fail those tests, bears 30 percent, which some treaties cut to 15 or 10 percent. Net interest above 30 percent of the prior year's tax EBITDA is not deductible, and loans running the other way, from the Peruvian company to its shareholders, are taxed as dividends.
USD figures use S/ 3.446 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 26 October 2026 as shown in the Banco Central de Reserva del Perú statistics series PD04640PD. Amounts that the law sets in US dollars or soles are quoted as written. Conversions are for orientation only.
Key facts
| Withholding on interest on qualifying foreign loans (funds entered Peru, rate within prime plus 3 points), unrelated lender | 4.99 %LIR art. 56 a), as of 2026-10-28 · in force |
|---|---|
| Withholding on interest paid to a related foreign lender | 30 %LIR art. 56 j), as of 2026-10-28 · in force |
| Treaty cap on interest withholding (Chile, Canada, Mexico, South Korea, Switzerland, Portugal general rate) | 15 %Art. 11 of each treaty, as of 2026-10-28 · in force |
| Net interest deduction cap as a share of prior year tax EBITDA | 30 %LIR art. 37 a) 1, as of 2026-10-28 · in force |
| Years to carry forward disallowed net interest | 4 yearsLIR art. 37 a) 1, as of 2026-10-28 · in force |
| Loans that must be disbursed and repaid through the financial system | All loans of money, whatever the amount textTUO Ley 28194 art. 3, as of 2026-10-28 · in force |
The rule
1. Loans of money must be disbursed and repaid through the payment means of the law (bank deposits, transfers, payment orders, cards, cheques, remittances, letters of credit), whatever the amount of the loan. Payments to non domiciled persons may be channeled through Peruvian financial firms or through foreign banks only where the payer carries out foreign trade operations, and financing operations with foreign banks are outside that exception. If a loan is made by other means, the borrower cannot use the money to justify an increase in its assets or spending capacity, the lender must justify where the money came from, and payments made without these means give no right to deduct costs or interest or to claim tax credits or refunds.
Cost to do it: Bank charges and 0.005 percent financial transactions tax on the Peruvian account credit and debit; no registration or filing fee.
Example: An intercompany loan of S/ 50,000 must be credited to the borrower's Peruvian bank account and repaid by bank transfer; a cash loan would leave the borrower unable to deduct the interest. / Even a US$14,510 loan from the parent must move by bank transfer; there is no minimum below which cash is allowed.Texto Único Ordenado de la Ley Nº 28194 (Decreto Supremo Nº 150-2007-EF), as amended by Decreto Legislativo Nº 1529 (published 3 March 2022, in force 1 April 2022), Art. 3 second, fifth and sixth paragraphs, art. 5 and art. 8, 2022-03-03 official text · verified 2026-10-28
Cost to do it: Bank charges and 0.005 percent financial transactions tax on the Peruvian account credit and debit; no registration or filing fee.
Example: An intercompany loan of S/ 50,000 must be credited to the borrower's Peruvian bank account and repaid by bank transfer; a cash loan would leave the borrower unable to deduct the interest. / Even a US$14,510 loan from the parent must move by bank transfer; there is no minimum below which cash is allowed.Texto Único Ordenado de la Ley Nº 28194 (Decreto Supremo Nº 150-2007-EF), as amended by Decreto Legislativo Nº 1529 (published 3 March 2022, in force 1 April 2022), Art. 3 second, fifth and sixth paragraphs, art. 5 and art. 8, 2022-03-03 official text · verified 2026-10-28
2. Interest on foreign loans paid to a non domiciled legal entity is withheld at 4.99 percent provided that (1) for cash loans, the entry of the foreign currency into Peru is proven, and (2) the loan does not accrue annual interest above the prevailing prime rate in the lender's market plus three points, which must cover fees, commissions, premiums and any other sum paid to the foreign beneficiary on top of the agreed interest. Interest on foreign loans financing imports is included if the legal requirements are met. Interest that Peruvian banks and other multiple operation financial firms pay abroad for using their foreign credit lines is also withheld at 4.99 percent.
Cost to do it: 4.99 percent of gross interest.
Example: S/ 275,680 of annual interest on a qualifying loan from an unrelated foreign bank bears S/ 13,756 of withholding. / On US$80,000 of interest (8 percent on US$1,000,000) the withholding is US$3,992.Texto Único Ordenado de la Ley del Impuesto a la Renta (Decreto Supremo Nº 179-2004-EF); art. 56 b) replaced by Ley Nº 29645 (published 31 December 2010, in force 1 January 2011), Art. 56 a) and b), 2010-12-31 official text · verified 2026-10-28
Cost to do it: 4.99 percent of gross interest.
Example: S/ 275,680 of annual interest on a qualifying loan from an unrelated foreign bank bears S/ 13,756 of withholding. / On US$80,000 of interest (8 percent on US$1,000,000) the withholding is US$3,992.Texto Único Ordenado de la Ley del Impuesto a la Renta (Decreto Supremo Nº 179-2004-EF); art. 56 b) replaced by Ley Nº 29645 (published 31 December 2010, in force 1 January 2011), Art. 56 a) and b), 2010-12-31 official text · verified 2026-10-28
3. Withholding rises to 30 percent on: interest on foreign loans whose funds are not shown to have entered Peru, or the part of interest above the prime plus three points cap; interest paid abroad by Peruvian private companies on loans granted by a related foreign company; and interest on loans from a lender whose participation is meant to conceal a loan between related parties (back to back), which is presumed when the Peruvian borrower cannot show that the legal structure adopted with the lender matches the economic substance of the deal. This does not apply to the financial firms of art. 56 b).
Cost to do it: 30 percent of gross interest, before treaty relief.
Example: The same S/ 275,680 of interest paid to the foreign parent bears S/ 82,704 of withholding. / US$80,000 of related party interest: US$24,000 withheld instead of US$3,992.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 56 j) incorporated by Ley Nº 29645 (published 31 December 2010, in force 1 January 2011), Art. 56 j), 2010-12-31 official text · verified 2026-10-28
Cost to do it: 30 percent of gross interest, before treaty relief.
Example: The same S/ 275,680 of interest paid to the foreign parent bears S/ 82,704 of withholding. / US$80,000 of related party interest: US$24,000 withheld instead of US$3,992.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 56 j) incorporated by Ley Nº 29645 (published 31 December 2010, in force 1 January 2011), Art. 56 j), 2010-12-31 official text · verified 2026-10-28
4. Where the lender is resident in a treaty country, Peru's tax on interest is capped at 15 percent of gross interest under the treaties with Chile, Canada, Mexico, South Korea, Switzerland and Portugal. Switzerland caps it at 10 percent for interest on credit sales of industrial, commercial or scientific equipment and on loans of any kind granted by a bank, and Portugal at 10 percent for interest on loans granted by banks. The cap mainly helps related party interest otherwise taxed at 30 percent; the 4.99 percent domestic rate is already below every cap.
Cost to do it: Cost of documenting treaty residence of the lender (residence certificate) before paying.
Example: Interest of S/ 275,680 paid to a related Mexican lender bears S/ 41,352 (15 percent) instead of S/ 82,704. / Related party interest of US$80,000 to a Mexican or Chilean parent: US$12,000 withheld under the treaty, not US$24,000.Convenio Perú y Suiza para evitar la doble tributación (approved by Resolución Legislativa Nº 30143, ratified by Decreto Supremo Nº 008-2014-RE, published 1 March 2014, applicable from 1 January 2015), and the treaties with Chile, Canada, Mexico, South Korea and Portugal, per SUNAT Informe Nº 0055-2021-SUNAT/7T0000, Art. 11 of each treaty, 2014-03-01 official text · verified 2026-10-28
Cost to do it: Cost of documenting treaty residence of the lender (residence certificate) before paying.
Example: Interest of S/ 275,680 paid to a related Mexican lender bears S/ 41,352 (15 percent) instead of S/ 82,704. / Related party interest of US$80,000 to a Mexican or Chilean parent: US$12,000 withheld under the treaty, not US$24,000.Convenio Perú y Suiza para evitar la doble tributación (approved by Resolución Legislativa Nº 30143, ratified by Decreto Supremo Nº 008-2014-RE, published 1 March 2014, applicable from 1 January 2015), and the treaties with Chile, Canada, Mexico, South Korea and Portugal, per SUNAT Informe Nº 0055-2021-SUNAT/7T0000, Art. 11 of each treaty, 2014-03-01 official text · verified 2026-10-28
5. Interest on debt is deductible only if the debt was incurred to acquire goods or services linked to producing taxable income in Peru or maintaining its source, and net interest (interest expense above interest income) is not deductible to the extent it exceeds 30 percent of the previous year's tax EBITDA (net income after loss offset plus net interest, depreciation and amortization). Disallowed net interest can be carried to the following four years, subject to the same limit. The cap does not apply to banks, insurers and registered factoring firms, among other exclusions in the article.
Cost to do it: Tax cost of the disallowed interest at the 29.5 percent corporate rate until it can be used within four years.
Example: A company with S/ 10,000,000 of prior year tax EBITDA can deduct up to S/ 3,000,000 of net interest; S/ 3,500,000 of net interest leaves S/ 500,000 to carry forward. / Tax EBITDA of US$2,901,915 caps deductible net interest at about US$870,575 for the year.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 37 a) as amended by Decreto Legislativo Nº 1424 (published 13 September 2018) and Decreto de Urgencia Nº 013-2020 (published 23 January 2020), in force 1 January 2021, Art. 37 a), numerals 1 and 2, 2020-01-23 official text · verified 2026-10-28
Cost to do it: Tax cost of the disallowed interest at the 29.5 percent corporate rate until it can be used within four years.
Example: A company with S/ 10,000,000 of prior year tax EBITDA can deduct up to S/ 3,000,000 of net interest; S/ 3,500,000 of net interest leaves S/ 500,000 to carry forward. / Tax EBITDA of US$2,901,915 caps deductible net interest at about US$870,575 for the year.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 37 a) as amended by Decreto Legislativo Nº 1424 (published 13 September 2018) and Decreto de Urgencia Nº 013-2020 (published 23 January 2020), in force 1 January 2021, Art. 37 a), numerals 1 and 2, 2020-01-23 official text · verified 2026-10-28
6. Any loan that a Peruvian company (other than multiple operation financial firms and leasing companies) grants to its shareholders, owners or members, in cash or in kind, generally or individually, whatever the form of the operation, is a dividend up to the limit of the company's profits and free reserves, except loans to workers who only hold labor shares. Upstream loans to a foreign parent or affiliate shareholder therefore trigger the 5 percent dividend withholding.
Cost to do it: 5 percent of the loan, up to retained profits and free reserves.
Example: A subsidiary with S/ 2,000,000 of retained earnings that lends S/ 689,200 to its foreign parent must withhold S/ 34,460 as on a dividend. / A US$200,000 upstream loan costs US$10,000 of dividend tax even if it is later repaid.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 24-A f) as amended by Ley Nº 30296 (published 31 December 2014, in force 1 January 2015), Art. 24-A f) and art. 56 e), 2014-12-31 official text · verified 2026-10-28
Cost to do it: 5 percent of the loan, up to retained profits and free reserves.
Example: A subsidiary with S/ 2,000,000 of retained earnings that lends S/ 689,200 to its foreign parent must withhold S/ 34,460 as on a dividend. / A US$200,000 upstream loan costs US$10,000 of dividend tax even if it is later repaid.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 24-A f) as amended by Ley Nº 30296 (published 31 December 2014, in force 1 January 2015), Art. 24-A f) and art. 56 e), 2014-12-31 official text · verified 2026-10-28
7. Converting private foreign debt into shares is a form of foreign investment, so a parent loan capitalized into equity can be registered with ProInversión and from then on enjoys the right to repatriate the capital without authorization.
Cost to do it: No authorization fee; capitalization requires a notarial deed and SUNARP registration, then ProInversión registration within its 25 business day term.
Example: A S/ 3,446,000 parent loan converted into shares becomes registrable foreign capital. / A US$1,000,000 loan capitalized into equity counts as foreign investment under DL 662 art. 1 c).Decreto Legislativo Nº 662, Art. 1 c) and art. 3, 1991-09-02 official text · verified 2026-10-28
Cost to do it: No authorization fee; capitalization requires a notarial deed and SUNARP registration, then ProInversión registration within its 25 business day term.
Example: A S/ 3,446,000 parent loan converted into shares becomes registrable foreign capital. / A US$1,000,000 loan capitalized into equity counts as foreign investment under DL 662 art. 1 c).Decreto Legislativo Nº 662, Art. 1 c) and art. 3, 1991-09-02 official text · verified 2026-10-28
| Lender | Rate | Withholding US$ | Withholding S/ | Source |
|---|---|---|---|---|
| Unrelated foreign bank, funds entered Peru, rate within prime plus 3 points | 4.99% | 3,992 | 13,756 | LIR art. 56 a) |
| Related foreign company, no treaty | 30% | 24,000 | 82,704 | LIR art. 56 j) |
| Related company in Chile, Canada, Mexico, South Korea, Switzerland or Portugal | 15% treaty cap | 12,000 | 41,352 | Treaty art. 11 |
| Unrelated lender, funds never entered Peru | 30% | 24,000 | 82,704 | LIR art. 56 j) |
Annual interest of 8 percent on a US$1,000,000 foreign loan (US$80,000, S/ 275,680 at S/ 3.446 per US dollar on 26 October 2026), by lender. Illustration only.
Worked example
- A Peruvian mining services company borrows US$1,000,000 from an unrelated US bank at 8 percent, within the US prime rate plus three points. The bank wires the funds to the company's Peruvian account, which proves their entry. Each year the company pays US$80,000 of interest and withholds US$3,992 (4.99 percent). No central bank registration is needed.
- If the lender were a related parent in a country without a treaty with Peru, the withholding would be US$24,000 (30 percent); with a Chilean or Mexican parent the treaty cuts it to US$12,000 (15 percent). Either way, net interest above 30 percent of the prior year's tax EBITDA is not deductible that year.
- Argentina and Peru: there is no income tax treaty between the two countries, so interest from a Peruvian borrower to an Argentine related lender bears 30 percent in Peru; Argentina's own FX rules for lending abroad are covered in The Argentine Thread guide.
Step by step
- Decide whether the lender is related; related party interest goes to 30 percent unless a treaty applies.
- Price the loan within the lender market prime rate plus three points, including all fees, and document the benchmark.
- Have the lender wire the funds into the borrower's Peruvian bank account and keep the credit advice as proof of entry.
- Project the 30 percent of tax EBITDA limit for the following year before setting the loan size.
- Withhold on each interest payment or credit and pay SUNAT in the monthly return; for treaty rates keep the lender's residence certificate on file.
- Repay through the bank; consider capitalizing the debt and registering it with ProInversión if it will stay long term.
Common traps
- Funds that never reached Peru (for example paid by the lender directly to a foreign supplier) lose the 4.99 percent rate and bear 30 percent.
- Fees and commissions count toward the prime plus three points cap; interest above the cap is taxed at 30 percent on the excess.
- Back to back loans through a bank that conceal a related party loan are taxed at 30 percent when the borrower cannot show the structure matches the economic substance.
- Upstream loans and cash pooling where the Peruvian company lends to its shareholders are dividends up to its retained earnings.
- A loan settled in cash, of any size, breaks the bank channel rule and costs the interest deduction.
Sources
- TUO Ley Nº 28194, bancarization and ITF, updated text (SUNAT)
- Ley del Impuesto a la Renta, chapter VII, art. 54 to 56 (SUNAT)
- Ley del Impuesto a la Renta, chapter VI, art. 37 (SUNAT)
- Ley del Impuesto a la Renta, chapter V, art. 24-A and 24-B (SUNAT)
- Peru and Chile tax treaty text (MEF)
- Peru and Canada tax treaty text (MEF)
- Peru and Mexico tax treaty text (MEF)
- Peru and South Korea tax treaty text (MEF)
- Peru and Switzerland tax treaty text (MEF)
- Peru and Portugal tax treaty text (MEF)
- SUNAT Informe Nº 0055-2021-SUNAT/7T0000 (legal basis and dates of Peru's tax treaties)
- Decreto Legislativo Nº 662 (MEF)
- Argentina, double taxation treaties in force (argentina.gob.ar)
- BCRP statistics, SBS banking system selling rate series PD04640PD
Related pages
- fx/fx-and-capital-controls
- fx/capital-contributions-and-repatriation
- fx/dividends-and-profit-repatriation
- taxes/thin-capitalization
- taxes/withholding-on-remittances
- taxes/tax-treaties
- taxes/transfer-pricing
- finance/capital-markets-banking-and-credit
- /country/peru/
- /calendar/
- Live dashboard
- https://theargentinethread.com/guide/
Related: Peru country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide
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