¿Why invest in Uruguay?

Uruguay, located between its two large neighbors, Argentina and Brazil, is considered the Pearl of the South in Latin America. Known for its relaxed lifestyle, wineries, rolling fields, exotic birds, and beautiful oceanfront beaches, Uruguay is a safe and politically stable country. It offers excellent infrastructure and a friendly local population. Visitors from all over the world and the region choose Uruguay as their paradise to spend their vacations and explore the depths of what this magnificent country has to offer.

Exploring Uruguay takes us from distant territories through winding roads that unfold into open prairies, cattle lands, and vast, uncrowded areas—something unusual to find in such a small country. Much of the development has been invested in agricultural production.

Thanks to its strategic geographical position at the mouth of the Río de la Plata and its natural port, it initially attracted traders to the region, who developed commerce and attracted European immigrants seeking a future in these lands. Uruguayans are excellent ambassadors of their homeland, invariably friendly and some of the most serene and pleasant people you can find anywhere.

MAIN REASONS TO CHOOSE URUGUAY

-    Strength and stability of its institutions.

-    The strong social, political, and economic stability of the country.

-    Investment-grade status of Uruguay's debt.

-    Equal treatment for local and foreign investors.

-    Free flow of capital, including the free repatriation of dividends and capital.

-    Founding member of Mercosur, initially formed with Argentina, Brazil, and Paraguay, creating a potential market of more than 295,000,000 inhabitants

PTIONS TO OBTAIN FISCAL RESIDENCY

-    Staying in Uruguay for more than 183 days in a year.

-    Establishing the primary core or base of activities or economic or vital interests in Uruguay.

-    Investing in real estate for approximately USD 550,000 (at July 2024) + staying in Uruguay for more than 60 days in the calendar year.

-    Investing in real estate for approximately USD 2,400,000 (at July 2024) without the need for a minimum period of stay in the country.

-    Direct or indirect investment in a company for approximately USD 2,400,000 (at july 2024) that generates 15 new jobs from 7/1/2020.

-    Direct or indirect investment of approximately USD 7,200,000 (at july 2024) in a company carrying out activities or projects of national interest according to the Investment Promotion Law.

The fiscal resident will be subject to the Uruguayan tax system, which is based on territoriality with some exceptions.

-    Only assets located in Uruguay will be subject to the Wealth Tax.

-    Income from abroad will be exempt from taxes except for capital income derived from deposits, loans, or other placements of capital or credit of any nature.

TAX HOLIDAY

For foreigners who become fiscal residents, they will have the option regarding capital income earned abroad to:

-    Not pay any tax on such income in the year they became fiscal residents and for the subsequent 10 years, and then start paying IRNR at the regular rate of 12%.

-    Pay IRNR at a rate of 7% from the moment they become fiscal residents onwards.

INVESTMENT PROMOTION REGIME

-    The Investment Promotion Law declares both national and foreign investment and its protection to be of national interest.

-    Foreign investors enjoy the same incentives as local investors, with no discrimination from a tax perspective or any kind of restrictions.

-    There is no requirement to have local partners or Uruguayan nationals as company directors.

-    No prior authorization or registration is required, and there are no restrictions on the transfer or repatriation of capital or profits at any time.

-    Companies from any sector that present an investment project promoted by the Executive Power can access the benefits granted by the law:

-    Exemption from the Corporate Income Tax (IRAE) for a maximum amount equivalent to 100% of the total investment, for up to 15 years.

-    Exemption from the Wealth Tax (IP), for both fixed asset real estate and civil works for the same period.

-    Recovery of the Value Added Tax (IVA) paid on purchases of materials and services related to the installation of the company.

-    Exemption from the payment of rates and taxes on the importation of fixed asset movable goods that do not compete with national industry.

To obtain the tax benefits, the investor must submit an investment project to a committee of the Ministry of Economy and Finance (COMAP), which analyzes the project and grants tax exemptions based on the impact on certain factors, mainly: the creation of new jobs, the generation of exports, the incorporation of new technologies, the decentralization of activities, and the use of clean energy.

Approximately 25% of private investment in Uruguay is made using the benefits of the law.

URUGUAY XXI

URUGUAY, A DESTINATION FOR INVESTMENT

The significant growth of the country in the last decade is linked to the substantial increase in investment.

In Uruguay, Foreign Direct Investment (FDI) has reached record levels, positioning the country among the top recipients of FDI in terms of GDP in South America.