Ecuador regulates tax incentives for social housing donations

President Daniel Noboa has signed Executive Decree No. 440, establishing regulations for tax incentives designed to encourage donations and financing for social housing construction and to address Ecuador's housing deficit. The decree aims to streamline the process for both individuals and legal entities seeking fiscal benefits.

A significant innovation within the regulation is the creation of a digital "Housing Needs Catalog." This tool will pinpoint regions experiencing a deficit in affordable housing, guiding donation efforts more effectively. The decree outlines the procedures for accessing tax benefits, involving key entities such as the housing authority, the Internal Revenue Service (SRI), and the Ministry of Economy and Finance.

Donations eligible for tax incentives encompass a range of contributions, including completed homes, the construction of new social housing units, and financial resources dedicated to housing projects. All qualifying donations must be formalized through an agreement between the donor and the national housing authority. This agreement will specify the parties involved, the donation's value, and the respective obligations.

The regulation details various modalities for donations targeting the primary segment of social housing. These include construction on beneficiary-owned land, construction on state-owned land, and the direct handover of already-built homes. Each modality requires a formal delivery-acceptance act containing technical and legal property information, followed by the issuance of an official certificate to validate the tax benefit. Provisions for monetary donations and partial subsidies for a second segment of housing are also included, requiring funds to be channeled through the housing authority for exclusive use in social housing projects.