The aim of this application component is to process Income Tax (ISLR) (ISLR) in accordance with the applicable legislation.

To do so, each employee has to fill in the RA-I Form (Tax Deduction Agent) in order to provide the company with all the relevant information related to the estimated amount of payment and deductions for the current fiscal year.

The company acts as an Income Tax (ISLR) deduction agent and is thus responsible to the legal authorities for the calculation within the company of employee income deduction rates.

Tax calculation is carried out using the Tax Unit (UT) concept, which is an inflation index unit as well as a feature used to maintain the quantities assigned to tax rates and penalties, amongst other things. The Tax Unit has a Venezuelan currency value that is periodically updated.

There are four fiscal periods starting respectively in January, April, July and October. All employees must submit the RA-I Form during the first annual period. However, if there is any change in the amounts stated for a specific period, employees must submit another RA-I Form within the first 15 days of the following tax period and they must indicate the new values used to calculate the deduction rate to be applied for the rest of the year taking into account the amount deducted up to the current date.

If the employee does not submit the RA-I Form as scheduled, the company has the following option:

• To calculate the employee tax deduction rate according to the estimated pay in the company and the value of the one-off rebate defined in the applicable legislation.