Countries › Peru › Guide › 16. What is normal abroad but not here › Cash payments above S/ 2,000 lose their tax effect
Cash payments above S/ 2,000 lose their tax effect
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Last verified: 2026-10-29 · Status: Stable
Abroad a supplier can usually be paid in cash for any amount; in Peru any obligation above S/ 2,000 or US$500 must be paid through the banking system, even if split into smaller payments. Paying in cash does not make the payment illegal, but the buyer loses the expense deduction, the VAT credit and any refund linked to it. Loans must always go through banks whatever the amount, and real estate, vehicle and share deals of 1 UIT (S/ 5,500 in 2026) or more can only be paid through banks.
USD figures use S/ 3.452 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 27 October 2026, from the Banco Central de Reserva del Perú statistics series PD04640PD. UIT amounts use the 2026 UIT of S/ 5,500 set by Decreto Supremo Nº 301-2025-EF, as cited in SUNAT Resolución de Superintendencia Nº 000016-2026/SUNAT. Conversions are for orientation only.
Key facts
| Payments above this amount must use banking means of payment | 2000 PENTUO Ley 28194 art. 4 (DL 1529), as of 2026-10-29 · in force |
|---|---|
| Payments above this amount must use banking means of payment (US dollars) | 500 USDTUO Ley 28194 art. 4 (DL 1529), as of 2026-10-29 · in force |
| Threshold if a party is in SUNAT's two lowest compliance levels | 30 % of the general thresholdTUO Ley 28194 art. 4 (DL 1535), as of 2026-10-29 · in force |
| Real estate, vehicle and share payments that must use banks | 1 UIT (S/ 5,500 in 2026)TUO Ley 28194 art. 3 (DL 1529), as of 2026-10-29 · in force |
The rule
1. Obligations paid with sums of money above the threshold must be paid through Means of Payment, even when settled by partial payments below the threshold. Money lent or repaid under loan contracts must always go through Means of Payment, whatever the amount.
Cost to do it: Bank charges and the 0.005 percent ITF.
Example: A S/ 6,000 invoice paid in three cash instalments of S/ 2,000 is still caught by the rule. / About US$1,738 in total.Decreto Supremo Nº 150-2007-EF, TUO de la Ley Nº 28194, Ley para la Lucha contra la Evasión y para la Formalización de la Economía (El Peruano 23 September 2007), art. 3 as amended by Decreto Legislativo Nº 1529 (3 March 2022, in force 1 April 2022), Art. 3, 2022-03-03 official text · verified 2026-10-29
Cost to do it: Bank charges and the 0.005 percent ITF.
Example: A S/ 6,000 invoice paid in three cash instalments of S/ 2,000 is still caught by the rule. / About US$1,738 in total.Decreto Supremo Nº 150-2007-EF, TUO de la Ley Nº 28194, Ley para la Lucha contra la Evasión y para la Formalización de la Economía (El Peruano 23 September 2007), art. 3 as amended by Decreto Legislativo Nº 1529 (3 March 2022, in force 1 April 2022), Art. 3, 2022-03-03 official text · verified 2026-10-29
2. The threshold is S/ 2,000 or US$500, set in soles for obligations agreed in soles and in dollars for obligations agreed in dollars. If either party is rated by SUNAT in one of the two lowest compliance levels, the threshold is 30 percent of those amounts.
Cost to do it: No fee.
Example: With a low compliance counterparty the threshold falls to S/ 600 or US$150. / S/ 600 is about US$174.TUO de la Ley Nº 28194, art. 4 as amended by Decreto Legislativo Nº 1529 (3 March 2022) and Decreto Legislativo Nº 1535 (19 March 2022), Art. 4, 2022-03-03 official text · verified 2026-10-29 · changed: Decreto Legislativo Nº 1529 lowered the threshold from S/ 3,500 or US$1,000 to S/ 2,000 or US$500 from 1 April 2022.
Cost to do it: No fee.
Example: With a low compliance counterparty the threshold falls to S/ 600 or US$150. / S/ 600 is about US$174.TUO de la Ley Nº 28194, art. 4 as amended by Decreto Legislativo Nº 1529 (3 March 2022) and Decreto Legislativo Nº 1535 (19 March 2022), Art. 4, 2022-03-03 official text · verified 2026-10-29 · changed: Decreto Legislativo Nº 1529 lowered the threshold from S/ 3,500 or US$1,000 to S/ 2,000 or US$500 from 1 April 2022.
3. Payments of 1 UIT or more for creating or transferring real rights over real estate, transferring or creating real rights over vehicles, and acquiring, increasing or reducing an interest in a company's capital may only be made through Means of Payment, even when paid in part. AML obliged parties such as notaries must record the means of payment in the deed.
Cost to do it: 1 UIT, S/ 5,500 in 2026.
Example: A capital increase of S/ 50,000 must be paid by bank transfer or deposit and shown to the notary. / 1 UIT is about US$1,593.TUO de la Ley Nº 28194, art. 3 as amended by Decreto Legislativo Nº 1529, Art. 3 third and fourth paragraphs, 2022-03-03 official text · verified 2026-10-29
Cost to do it: 1 UIT, S/ 5,500 in 2026.
Example: A capital increase of S/ 50,000 must be paid by bank transfer or deposit and shown to the notary. / 1 UIT is about US$1,593.TUO de la Ley Nº 28194, art. 3 as amended by Decreto Legislativo Nº 1529, Art. 3 third and fourth paragraphs, 2022-03-03 official text · verified 2026-10-29
4. Means of Payment through financial system companies are: account deposits, drafts, fund transfers, payment orders, debit cards issued in Peru, credit cards, cheques, remittances and letters of credit. The rule is met only if payment is made directly to the creditor or supplier, or to a third party whose designation was reported to SUNAT before payment.
Cost to do it: Bank fees.
Example: Paying a supplier's invoice to the supplier's owner's personal account does not count unless the designation was reported to SUNAT first.TUO de la Ley Nº 28194, art. 5 as amended by Ley Nº 30730 (21 February 2018) and art. 5-A, Art. 5 and 5-A, 2018-02-21 official text · verified 2026-10-29
Cost to do it: Bank fees.
Example: Paying a supplier's invoice to the supplier's owner's personal account does not count unless the designation was reported to SUNAT first.TUO de la Ley Nº 28194, art. 5 as amended by Ley Nº 30730 (21 February 2018) and art. 5-A, Art. 5 and 5-A, 2018-02-21 official text · verified 2026-10-29
5. For tax purposes, payments made without Means of Payment give no right to deduct expenses, costs or credits, to offset, or to claim refunds of taxes, credit balances, tax refunds, early recovery or drawback. For loans made outside Means of Payment the borrower cannot use the money to justify an increase in wealth and the lender must justify its origin.
Cost to do it: Loss of the deduction and the VAT credit.
Example: A company that pays a S/ 3,000 invoice in cash cannot deduct the S/ 3,000 cost or use the VAT credit on it. / About US$869 of non deductible cost.TUO de la Ley Nº 28194, Art. 8, 2007-09-23 official text · verified 2026-10-29
Cost to do it: Loss of the deduction and the VAT credit.
Example: A company that pays a S/ 3,000 invoice in cash cannot deduct the S/ 3,000 cost or use the VAT credit on it. / About US$869 of non deductible cost.TUO de la Ley Nº 28194, Art. 8, 2007-09-23 official text · verified 2026-10-29
| Payment | Threshold | Consequence if paid in cash |
|---|---|---|
| Any obligation in soles | Above S/ 2,000 (about US$579) | No deduction, credit, offset or refund |
| Any obligation in dollars | Above US$500 | No deduction, credit, offset or refund |
| Loans (granting or repaying) | Any amount | Borrower cannot justify wealth; lender must justify origin |
| Real estate, vehicles, company capital | 1 UIT, S/ 5,500 (about US$1,593) | Only payable through banks; notary records the means |
When the banking system must be used (USD at S/ 3.452)
Worked example
- A shareholder lends S/ 20,000 (about US$5,794) in cash to a new Peruvian company: the loan is outside the Means of Payment rule, so the company cannot use it to support its cash position before SUNAT and the shareholder must justify the source of funds. Done by bank transfer, it is fully effective.
Step by step
- Open company bank accounts before trading and route all supplier payments above S/ 2,000 or US$500 through them.
- Pay suppliers directly to accounts in their name, or report any third party designation to SUNAT before paying.
- Fund capital and shareholder loans by bank transfer and keep the evidence for the notary and SUNAT.
- Check counterparties' SUNAT compliance level, since a low rating cuts the threshold to S/ 600 or US$150.
Common traps
- Splitting a payment into instalments under S/ 2,000 does not avoid the rule.
- Paying a third party, such as an owner or relative of the supplier, can lose the deduction unless reported to SUNAT first.
- Cash loans between related parties lose all tax effect, whatever the amount.
- The VAT credit is checked when the invoice is paid, so a later cash payment can claw back a credit already used.
Sources
- SUNAT, TUO of Ley 28194 approved by DS 150-2007-EF, updated to DL 1529 and DL 1535
- SUNAT, Resolución de Superintendencia Nº 000016-2026/SUNAT citing the 2026 UIT under DS 301-2025-EF
- Banco Central de Reserva del Perú, series PD04640PD (SBS banking system selling rate)
Related pages
- fx/bank-payments-and-itf
- normal-abroad/financial-transactions-tax
- fx/cash-limits-and-border-declarations
- regulation/anti-money-laundering
- https://theargentinethread.com/guide/
- normal-abroad/what-works-differently-in-peru
- /country/peru/
- /calendar/
- Live dashboard
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