Government issued Decree 560 of April 15, 2020 and established extraordinary measures for companies’ in bankruptcy procedures to mitigate the effects caused by the health emergency.

The Decree includes the following tax measures both for companies that are admitted to a reorganization since the entry into force of the new Decree, and for those companies that are already executing a reorganization agreement concluded prior to the issuance of the Decree:

• From the issuance of the decree and until December 31, 2020, these companies will not be subject to withholding tax and should not apply self-withholding for income tax.
• For fiscal year 2020, these companies should not calculate or pay advance of income tax.
• For fiscal year 2020 these companies will not be subject to presumptive income.
• From the issuance of the decree and until December 31, 2020, these companies will be subject to VAT withholding at a rate of 50%. This withholding tax should be applied by the withholding agents who purchase goods and services from these companies.

See Decree 560 of 2020