The tax system in construction contracts

The region, facing the European and American crisis – which is basically hitting the construction sector very hard – has become a very interesting investment area for this sector. In the case of Peru, the scope of construction in recent years has grown significantly, generating the attraction of various foreign companies, which have migrated to that country for the benefit of a solid economy, sustained growth and because in the construction sector there are very attractive tax treatments that we will detail.

Income tax

In relation to the IR, the relevant issue related to the construction sector is that related to the recognition of income. It constitutes a basic rule, applicable to the generators of corporate income (of “third category”), to recognize the income generated in a commercial year according to the criterion or principle of “the accrued”. Thus, art. 57 of the LIR states that “Revenues will be allocated to the taxable year in accordance with the following rules: a) Revenues from the third category will be considered to be produced in the business year in which they accrue.”

Faced with the lack of definition of what is “accrued”, it is allowed to investigate the meaning in other rules. In that sense, the International Standard of Accounting – IAS 1 states that revenues, expenses and costs will be recognized as the right is earned or when they are incurred and not when they are collected or paid, shown in the accounting books and expressed in the financial statements in the which correspond In this sense, if a company acquired the right to income in an exercise, then in that year it will have generated the income, regardless of whether it received it or not.

However, in the case of construction companies or similar companies that execute work contracts, they may apply the general rule of imputation of income (through the “accrued” already outlined) or the special rule regulated by art. 63 of the LIR. So, we went on to detail the allocation criteria applicable to these contracts.

The methods of recognizing the income will be applied according to whether the work contracts are not greater than a recordable year or greater than a taxable year. In the first, if the construction or similar companies execute work contracts whose results correspond to a single taxable year, in order to recognize the income generated by said contracts, they must apply the accrual principle

In the second, if the results correspond to more than one taxable year, the income recognition methods indicated in art. 63. These correspond to the method of perceived, accrued and deferred income.

Taxable exercise

In the perceived method, to determine the gross annual income, the construction companies or similar will allocate to each taxable year the gross income that results from applying the percentage of gross profit calculated on the amounts collected for each work, during the financial year. For the total of the respective work. In this case, for the payments on account of the IR, the amounts collected in each month for progress of work are considered as “monthly net income”.

For the accrual method, each taxable year is assigned the gross income that is established by deducting the amount collected or receivable for the work executed in each work during the fiscal year, the costs corresponding to said works. Thus, the monthly net income is constituted by the sum of the amounts collected and receivable for the work executed in each work during said month.

The method of deferring income does not apply to companies whose execution of works will not be greater than three years. Thus, the IR will be applied to the tax utility determined in the commercial year in which the works are completed, with the income being deferred until that year.

Singularities of business income

In Peru, the definition of “works contracts” must be found in the Civil Code (articles 1771 to 1789), in a supplementary application authorized by Norma IX of the Tax Code, in the absence of an express definition in the law of the IR.

The “construction companies” must be defined through the ISIC 45. Thus, they are not construction companies, architecture and engineering, scaffolding rental without assembly and disassembly, decontamination of the soil, deepening of wells, etc.

In addition to the IR, there are two operations related to the construction sector that are taxed with an 18% VAT rate: a) Construction contracts and, b) The first sale of real estate executed by the constructor (not being taxed in this assumption the value of the land).

Attention with the methods

The construction companies are not obliged to apply the three methods described. If this is not done, the recognition of income is governed by the general rule of the “accrual principle”.

The adopted method will be applied uniformly to all works executed by the company and cannot be varied without the authorization of the Sunhat, which will determine from which year the change may be applied.

In all cases, companies must keep a special account for each work. These accounts must be differentiated in the management analytical accounts.

The methods will only apply to income from the execution of “works”. Therefore, with respect to companies that perform other types of activities, their income will be charged according to the accrual principle and the income from works will be added, as indicated by the method chosen.

Cheap houses made with glass bottles

Plastic, glass, one, two liters and up to 600 milliliters. All bottles serve the Bolivian Ingrid Vasa Dies to carry out an ecological and social project that began almost seven years ago and today, thanks to social networks, has spread to a number of countries in the Americas.

With bottles and other obsolete materials – which in many places end up in the trash in the absence of an appropriate recycling system – Ingrid builds eco-housing for low-income families.

The project started almost by chance. Ingrid kept bottles in the courtyard of her house for a very humble lady who spent every week to pick them up. One day, the lady became ill and the bottles, scattered everywhere, aroused the anger of her husband.

“‘Boot those bottles,’ he told me, ‘you have enough to make a house.’ And that’s how I came to realize the dream of Claudia, a little girl who had asked me as a Christmas wish a room for her, who lived in a four-by-four room with all her family, “Ingrid told her. BBC World.

To make a home of 170 square meters, about 36,000 containers are needed. “Of the two-liter bottles, I need 81 to make a square meter,” Ingrid explained.

Each bottle is filled with disposable material: paper, plastic bags, batteries, sand and earth. Once filled (each bottle weighs 3.6 kg), they are used to build the walls. It binds them with lime, cement and is fastened with a kind of braid.

The plaster is another example of recycling. “I use a mixture of powdered milk powder, horse feces, linseed oil, cattle blood, sugarcane molasses … well, whatever,” says Ingrid. “To make the floor,” he adds, “I use chopped rims.”

And although the work is hard, the atmosphere is more like a party: all neighbors, even children, participate in the work. Onlookers can shop for homemade food that locals prepare for the occasion and crafts made from plastic bottles and other disposable products that Ingrid taught them to do so that those who lack the resources can earn a little money.

That is why Ingrid emphasizes the two aspects that characterize his work: it is an ecological project because it takes out of circulation materials that would otherwise contaminate the planet and teach to care for the environment, but it is also a social project because it offers decent housing to the poorest and fosters solidarity and ties within the community.

Tips for building sustainable homes

The idea of ​​sustainable houses is not only about building with seemingly extravagant materials or a simple fashion. It is a whole way of life in which ecology is a maxim, requiring commitment on the part of the person who is showing interest in reducing the footprint of man in the world. Taking care of the environment and reducing our impact has become a shared responsibility.

Daily life 

For the construction of a sustainable home you can start with some actions in your daily life that allow you to reduce your consumption. Minimizes the use of plastics when choosing metal or glass containers. It is also very useful to reduce the consumption of batteries or make use of those that are rechargeable.

Another good way to start helping the planet is to clean the home, using non-aggressive materials and alternatives to chemicals such as vinegar, vodka or baking soda. When this is not possible, purchase products in bulk to avoid the use and generation of unnecessary waste.


Many times to create environments in the rooms we require a specific lighting, which we can have with low consumption lights. In terms of energy consumption it also works to replace old appliances with more modern ones that save energy.

Another thing you can do is to acquire floors and furniture made from ecofriendly plantation tree woods with natural fiber upholstery; this in addition to helping make your home look unique. Remember that for decoration you can make use of different materials, giving life to something that you thought you might throw.

Building materials

If you want your home to be fully sustainable, then you will have to make an investment, whether you start from scratch and build it or make modifications to your property. This is because the materials are different, because it seeks to avoid all that harm the planet.

One of the fundamental modifications is the placement of solar panels, which take advantage of this energy to become electric, reducing the costs for the maintenance of the house.

Tips for cleanliness construction

Mounting bolts are used in assembly systems and production equipment for the reception and positioning of work pieces for the assembly process. Due to this function they are in direct contact with component surfaces. A fact which is particularly important when used in cleanliness-sensitive mounting areas, since particle entrainment towards the work piece is largely effected by means of contact surfaces. What tips should designers have to take into account when designing mounting bolts in order to meet the requirements of technical cleanliness?

The present practical example shows two different design approaches for receiving bolts which are used in the cleanliness-sensitive area of ​​a mounting process. While the right-hand bolt mirrors a “conventional” design, the right-hand bolt has been designed to ensure clean design principles.

Reduce contact surfaces

In order to maximize particle transfer from the receiving bolt to the work piece, product-contacting surfaces are to be kept as small as possible. A line contact is thus preferable to a surface contact. In addition to the vertical support of the work piece, the contact surfaces for horizontal positioning must also be taken into account.

Vertical support as surface contact, “particle collecting bag”

In the left-hand-side implementation example, the work piece support was implemented by a linear contact, while a surface support is present in the calculation problem on the right.

The contact surfaces for horizontal positioning have been reduced in both cases, in that only circular sectors have the contact diameter.

Particle-repellent radii and bevels

A central principle in the cleanliness of the construction is the avoidance of horizontal surfaces or of dirt sinks and “dirty pockets”.

In their place, particle-repelling radii and slopes are to occur. On the one hand, particles are prevented from accumulating in a larger number; on the other hand, zones which are easier to clean are generally also formed.

In the present practice, this principle was implemented in two ways in a clean-clean design (on the left-hand side). On the one hand, the horizontal image was taken as a radius on the other hand, a particle-deflecting slope was applied in the connection area of the receiving bolt.

In the conventional right-hand side approach, “dirt sinks” are found in both places, which are difficult to clean and prolong particle entrainment.

What is modular construction?

The modular construction is an industrialized solution, practically all molded in the factory, creating profiles or beams that are connected in the factory forming panels.

These panels, still in the factory, are provided with the necessary and coated installations, forming a module, which constitutes an environment division. The modules are then transported and assembled on site, fitting into several different formats, it’s almost like a layman’s joke, in which each piece represents an environment.

Advantages of modular constructions

Time is money!

Modular Construction proves cost reductions, deadlines and resources when constructing its new environments, after all, the modules or panels arrive on site and one stage of the work ends up being independent of the next to happen. With this, two or more steps can be executed simultaneously, making execution faster.


Modular solutions enable companies to create numerous environments, be it an office, a sales booth and many more. Therefore, the modular construction is highly flexible, with potential to adapt to the specific needs of each project.

Enabling your business

High-quality materials and finishes ensure the durability of the work, resulting in less headache for you, leaving you time to focus on your business.

Yet the cladding panels are easily disassembled and reassembled. This versatility allows the modular construction to be moved and reused for other applications, as the company needs to expand.

Ways to cool a commercial building

Fresh and well-ventilated commercial buildings are necessary for employee productivity and health. Congestion, overheated buildings produce poor air quality as well as indoor pollution. According to studies, indoor air pollution is five times worse than outdoor pollution. However, there are a variety of effective strategies for cooling commercial buildings.

Cooling system

Cooling systems, such as air conditioning units and technologies such as cooling district and evaporative precooling, should be adapted to the size of the building. When a cooling system is too large for a building, chances are it will not work long enough to dehumidify the air. Instead, the air is moist and cold.


Fresh roofs reflect the heat of the sun, increasing the efficiency of a commercial building and lowering the cooling costs. Fresh ceilings are generally white and designed with renewable, non-toxic resources. Dark roofs, on the other hand, absorb the heat, which accumulates in the building.

Solar windows

Windows with little solar heat get coefficients or SHGC, can go a long way in lowering the price of your commercial building cooling. These windows allow plenty of natural light minimizing the heat. Consumers should search for windows with certified solar heat gain coefficients of 35 or lower. Daylight coming in through the window reduces your dependence on electric light and improves the employee work environment as well as performance.

Reduction of office heat sources

Office equipment can generate a lot of heat. To help cool the building, turn the computer off produce heat when you are not using it, especially before you leave the office. Computers and other equipment should be closed when not in use. Replace incandescent lamps with fluorescents to reduce heat and use ceiling fans and small office fans.

What are isolated concrete shapes

Insulated concrete shapes are hollow molds of polystyrene that mount as building blocks to construct walls. The empty shapes interlock in custom pattern and are held together with contacts and reinforcement bars. When designed and assembled, the molds are filled with concrete. The new technology with isolated concrete shapes combines the benefits of concrete with superior insulation, stability, and environmental friendliness.

Those who supervise residential and commercial construction benefit many advantages of choosing isolated concrete shapes over wood framing. Of course, concrete is extremely strong and sustainable, because it cannot be swallowed by insects, soaked by flooding, damaged by fire, or deformed by moisture. Use shapes streamlines work-intensive process to form concrete walls. The insulated concrete forms themselves are made of recycled materials, such as plastic strips and foam cups, so that they do not adversely affect the environment with deforestation.

Most importantly, the thermal and sound insulation of walls made of insulated concrete shapes is unmatched, with R values ​​of 30-40. An R value estimates the insulation ability of any material against noise, heat and cold. These shapes create quiet rooms that maintain their temperature and can save an incredible amount on the electricity bill. This can compensate for the slightly more expensive construction costs with concrete versus wood.

Building with isolated concrete shapes begins with a plan drawing. Then the molds can be stacked from the ground into simple walls. The molds are available in three varieties: blocks, planks, and panels. All types allow doors, windows, plumbing and electricity, and all require steel reinforcements like braces and reinforcement bars. But some use more concrete, vary in thickness, or work better in some applications.

In flat walls, using blocks, a large amount of concrete slurry is sandwiched between two sides of insulated materials of varying widths. Plank shapes are a little longer, which allows less design flexibility, but requires less concrete. In this type, the concrete flows to a waffle-like grid, so its thickness varies from a few inches to half-foot throughout the wall. Finally panels are the largest unit, about the size of a sheet of plaster. They form post-and-beam walls because the concrete fits in a series of cylindrical vertical beams and horizontal posts, the remainder of the wall being composed of foam. Because the concrete does not fill the entire wall, the panel system is cheaper and lighter.

What is construction land surveying?

No matter where you can go in the world, it seems like the construction is in progress. This is because the design is always necessary, whether it’s about building new structures or additions to the present. An important role in any type of construction is building land survey, which may include many different job tasks. These utilize many different skills and tools to determine a variety of factors that will participate before and during the construction of many different structures.

When building roads, bridges and highways, building measurement requires initial use of computers, calculators and other tools to determine the most important factors in the area that will participate in the upcoming construction. On a road built on previously untouched land, for example, a construction inspector will need to decide how the land has to be displaced to build the road in the way it has been planned. Each element of the building area and its surroundings should be considered in relation to the future road, such as trees, water, hills, and more. The inspector must also prepare the people to build the way for work with the addition of drainage systems, sidewalks and other minor parts of the entire project.

The calculations made when making road construction mapping will determine the easiest way for a roadmap crew to get their job done. Global Positioning System (GPS) equipment is one of the premier modern tools that can be used to do this by calculating topography ground and where the equipment will be placed and used for the fastest and easiest work possible. Other tools for trade in building land survey are levels, maps, computers and theodolites, the latter being tools that measure all the different slopes, angles, and deviations in the country that will develop.

The inspector must then be involved in the process of marking actual physical land with a predetermined system of actions and markers, which will usually follow a land survey map. These will be used by the construction crew to build up the structure as it is planned by specifying the places where specific work must be done. Once built, the road, bridge, or other device is sometimes revisited by the construction measurement team for several reasons, including evaluation of the job, determination of the Construction, examination of the possibility of future work, and more.

Building construction mapping involves many of the same aspects of the work, except in connection with construction of buildings, houses and other structures at different types of land. The initial work of Building Engineer resembles those of the road surveyor, and involves determining how the ground is to be manipulated by the construction crew to accommodate the structure. Building land survey also includes all parts of the structure and their integrity including pipes, foundations, floors, columns, walls and more, all of which must follow strict codes. Rather than a survey map, building engineer must utilize a much more complex system to map the construction site for the workers, which must be easily understood by all involved.

Advice for the construction of your commercial premises

At the time of reforming a commercial space, we must pay great attention to the facade, which will constitute the letter of presentation of your products to the public and will generate the first impression of the brand image. Hence the importance of submitting project decisions from outside the premises to a careful analysis.

The exterior of the premises must be designed with the aim of showing a small preview of what is to be found inside the premises and generate an image linked to the brand that serves as the main element of attraction for the public.

The main interest of the merchant is to draw the attention of their potential customers to access their premises, and to achieve this the facade can be a good ally. In many occasions, the facade becomes a good way of exhibiting the products, trying to turn them into an aspiration and an object of the public’s desire. In contrast, in those businesses where you want to sell an image of luxury and exclusivity, a more reserved appearance is transmitted, through the presence of security guards at the entrance, access bell or even the requirement of a prior appointment to be attended.

The exterior will be shaped through the following elements:

The facade and surroundings of the building

The façade is the front of the store, and without realizing it, it has a great influence on the image and attracting customers. This will be the identifying element of your business through its composition, signs, shop windows and materials used in its design.

The facade of the premises varies depending on the location that, in those cases in which it is subject to the Regulations of Protection of Historical Heritage, is an important condition that can set guidelines when designing the external composition of the premises. In this way, depending on whether the store is located in a historical environment or not, we can differentiate two types of facades of commercial premises:

Facade in cataloged building

In this type of buildings, the design of a facade with a more traditional character is imposed, where the design of the facade openings is conditioned by the characteristics of the building in its original state. In this case, there are usually some rules that regulate the design and placement of the sign and the color or materials to be used in the facade.

Contemporary facade

In general, the design of the exterior of the premises in buildings without historical protection, are characterized by their transparency and their visual permeability from the public road, even presenting even glass enclosures in the entire facade gap.

Not only the building in which the location is located is important, but also influence other constraints of the public road such as trees or urban furniture of the environment. These elements can favor an environment that helps the public to escape and enjoy their shopping experience. Other influential elements are the adjoining premises, whose appearance has to be taken into account as it will influence the perception of the environment of your business.

In the event that you settle in a rented space, pay special attention to the conditions of conservation of the exterior and interior of the premises established in the contract, limiting the possibilities of design and adaptation of the same to your new business.

Identification signs:

The sign is the identifying sign of the brand, whose design is determinant in the image that is wanted to transmit globally of the store. There are different possibilities of finishes: painted sign, backlit sign, lettering of loose letters, adhesive sign…

This can be complemented with identifying elements of the pennant type, which is supported by a metallic support perpendicular to the façade, so that it is easily recognizable to pedestrians on public roads.

To be effective, the sign must stand out, to capture the attention of the public and that can be differentiated and recognized from a distance the brand of the commercial premises.


The showcase consists of a glass cloth that separates the interior and exterior of the premises, after which it is usually available an exhibition space of the most representative sales items inside the premises.

In contemporary facades it is increasingly common to find a glass occupying the entire showcase surface, trying to visually eliminate the separation barrier between exterior and interior, favoring public access to the interior.

The showcase is designed with two objectives:

  • Identify the brand and the products that offer.
  • Offer a way of life linked to the articles and the brand that encourages the consumer’s desire to consume.

The way of exhibiting the products must be consistent with their characteristics, requiring large items of larger windows, while small items require a smaller showcase, exposing the height of the view in a way that is comfortable for the public view and inspect the product.

In most cases, the showcase is usually displayed on a platform that raises the exposure of the product from ground level, enhancing the product and placing it at a suitable level for a better perception of it.


The entrance doors must be designed to be accessible and encourage the entrance of the public to the interior. For this, it is recommended that they have a minimum width of 1 meter. These can be collapsible (towards the interior, so that traffic is not hindered on public roads) or sliding (offering a freer space, without affecting the interior).

Sometimes, access to the premises is characterized by the absence of an entrance door, eliminating the physical barrier between the interior and exterior of the premises, facilitating the flow of circulation of the public. In this case, an air curtain guarantees the comfort of the interior environment with respect to the outside temperature.

The location of the entrance is important, since it will mark the starting point of the itinerary that the public makes inside the premises. Therefore, it is a factor to take into account when making the interior distribution, so that the whole premises work properly. Sometimes, the location of the same is marked by the characteristics of the facade of the pre-existing building, being a conditioner that will be essential in the configuration of the rest of the premises.

The different alternatives of exterior design will depend on the characteristics of the location of the premises, but they must always be focused on promoting differentiation with respect to the competition and generating an image that encourages the consumption of the sales product, favoring the development of your business.

Accounting aspects of the valuation of the works in construction


In this sense we are going to raise several questions:

Activation of expenses prior to the start of the work. Let’s suppose that from the moment you have started the construction procedures and obtained the corresponding works license, there are a series of direct expenses attributable to each promotion, among which are the financial expenses and the opening of the loans obtained from the developer. . We also contemplate the possible capitalization of the interest on loans obtained for the purchase of lots, as the case may be, from the moment in which the necessary steps have been taken to start works. Can you capitalize all these expenses, and register it as a higher value of the stock?

Suppose, that the work that has been started is paralyzed by the circumstances of the market, because the company prefers to wait for the market to normalize. In this case, can expenses related to interest and loan opening costs capitalized to date be written off or expensed? Or only those that originate from the paralysis of the works?

What a difference there is, in the case that the work has been paralyzed because the City has denied a work license initially granted, cancellation that has been the subject of a demand by the promoter pending resolution at this time. Could all of the construction costs incurred to date be lost or expensed? Among these expenses, besides interest and other capitalized financial expenses are those of the corresponding works licenses, which probably will not serve the company since it will have to ask for it again. Should a baseline check be done to check what can be considered as an expense?

There are lots on which licenses have been initiated, etc., but construction has been paralyzed. In this case, could the expenses activated to date, which could consist of licenses, projects, interests, financial expenses, etc…