Annual income tax (ISR) return for a company in Honduras: how to close the books
From accounting profit to net taxable income, and why the year’s tax is recorded in that year and not when you pay it.
Related free calculator: Corporate income tax (ISR), simulation
From accounting result to taxable income
- Start from the year’s accounting profit before the ISR expense.
- Add the expenses the law does not allow you to deduct.
- Subtract the income that is not taxable.
- The result is the net taxable income.
- The ISR rate is applied to that base. The solidarity contribution is calculated only on the part that exceeds the threshold set by law.
The rates and the threshold are set by law, and the law changes. That is why in PymesPros they are parameters you can change on screen, not numbers written into the code. Confirm them before filing.
Why the tax is recorded in the year it belongs to
IFRS for SMEs (section 29) asks you to recognize the period’s current tax as an expense and a liability in that same year, not when it is paid the following year. If you do not, the income statement shows profit before tax as if it were net profit, and the balance sheet hides a debt to the SAR.
What an automatic calculation does not cover
Some parts of the return depend on data your accountant reviews one by one. A serious system leaves them as a visible manual adjustment and does not make them up:
- The minimum payment on gross income.
- The net assets tax.
- Credits for withholdings and advance payments.
- Deferred taxes.
Important: the withholdings made from you and the advance payments do not reduce the year’s tax expense. They are a way of paying, not a smaller tax. They are used as a credit when you file.
What to review before filing
- The year is closed and all 12 months balance: banks reconciled, receivables and payables matching their detail.
- The year’s depreciation is recorded, and the difference between accounting and tax depreciation is explained.
- Inventory reconciled with the kardex and the physical count, with impairment assessed.
- The year’s payroll is complete, with the thirteenth and fourteenth month pay and employer contributions.
- Expenses with no valid receipt, or of a non-deductible nature, identified for the adjustment.
- Withholdings received backed by their certificates, and advance payments noted.
- The ISV (sales tax) filed during the year matches the accounting.
How PymesPros helps
PymesPros calculates net taxable income from the accounting profit and your adjustments, applies the legal parameters you have confirmed, generates the year’s tax journal entry and leaves a manual adjustment for what only your accountant can define. To simulate before closing, you have the free calculators for company income tax, solidarity contribution and net assets tax.
This guide is informational and does not replace the advice of a licensed public accountant. Rates, ceilings and dates are adjusted by the authorities from time to time: confirm them at the official source before applying them.
Frequently asked questions
When is the annual return due?
The SAR sets the deadline and may extend it. Confirm the current date on its portal; it is not written here because it changes.
Is accounting profit the tax base?
It is the starting point, not the end. It is adjusted with non-deductible expenses and non-taxable income.
What is the solidarity contribution?
An additional contribution calculated only on the part of net taxable income that exceeds a threshold set by law. You can simulate it with the free calculator.
Do advance payments reduce the tax expense?
No. They are a way of paying the same tax. They reduce what you owe when you file, not the year’s expense.
Keep reading
ISR and ISV withholding in Honduras: how to withhold, record and pay
What you withhold is not an expense and not your money: it is a debt to the SAR. Here is how to record it, document it and pay it.
Read the guide →Monthly accounting close for small businesses
A checklist to close the month without surprises and deliver financial statements on time.
Read the guide →Fixed asset depreciation in Honduras: method, useful life and recording
Spread the cost of an asset over the years you use it, without mixing up accounting and tax depreciation.
Read the guide →Tax advisory
Pay what is fair, on time and with support: tax planning and representation before the SAR.
See tax advisory →Want to see it working in your company?
Request a free 14-day demo, with sample data and no card. Leave your details and we will contact you to activate it, or write to us directly.
contacto@pymespros.com · Business hours, Honduras time (UTC−6)