Reminder of obligations for March 2021

We remind you that the following obligations must be met in March 2021:

• Regular Shareholders’ Meeting

According to Ecuadorian regulations, companies in Ecuador must hold a regular shareholders’ meeting at least once every year within the three months following the end of the company’s fiscal year, namely, by March 31.

• Payment of the 14th Salary – Coast and Galapagos Islands

Employees are entitled to receive a monthly bonus equivalent to one twelfth of the minimum consolidated basic salary for workers in general. In 2021 the basic salary is USD 400.

If an employee has made a written request to receive the sum as an accrued payment, this must be paid by March 15 in the Coast and Galapagos Islands regions. This amount will depend on the time worked by each employee.

• Calculation of Profits

By March 31 of the current year, employers must calculate the profits to be distributed to employees. Employees must register dependents by March 30; otherwise, they will not be considered for profit distribution purposes.

Profits must be paid out by April 15, based on time worked and the number of dependents of each employee.

• Economic Compensation for a Living Wage

Employers who have not paid all their employees a sum equal to or greater that the monthly living wage have until March 31 to pay compensation to employees who have not obtained this wage.

This compensation is mandatory for companies or individuals who are obliged to keep accounting records, who had profits at the end of the fiscal year, and who have paid an income tax advance payment in the fiscal year which is less than profits. To pay the compensation, employers must allocate up to 100% of profits, if necessary.

The living wage for 2020 has not yet been established; it corresponds to the cost of the basket of goods divided by the number of recipients in the household.

• Individual Income Tax Return

Individuals must declare and pay income tax in March, according to the following schedule: