 Uruguay´s
tax rules determine that foreign nationals who move to the country need
not worry about being subjected to taxes on all of their worldwide income
(unlike countries which tax you on all your income regardless of whether
you already pay taxes elsewhere).
The country recently took a step
that allows those relocating to Uruguay from other countries to enjoy an
important tax break. With the passage of Act 18,910, in June of 2012,
foreign nationals who become tax residents of Uruguay will not pay any
taxes on foreign earned income, for at least five years (and after that,
minimal or no taxes).
Below, we describe the taxes that
Uruguayan tax residents face on their foreign earned income, in three simple
rules:
Firstly, those who decide to spend more than 183 days per year in Uruguay
(thus, becoming tax residents) will have a five-year window during which
they will not pay income tax on any type of foreign income. This
rule is what the recent law (from June 2012) enacted.
The five-year window starts running
the year after one became a tax resident in Uruguay.
So, for example, if you become a
tax resident in January 2013, you will not pay any income tax in Uruguay,
on any type of foreign income, until 2019.
After years five, if you are still a tax resident of Uruguay, then
you would pay a flat 12% rate income tax on only two types of foreign income:
interest and dividends. Any other type of income is untaxed: capital gains,
pensions or retirement income, lease income, etc.
Now, if you already pay income tax elsewhere (on that interest or on
those dividends generated abroad), Uruguay does not tax you again (if you
pay 12% or more, abroad). This is called the “non-double taxation” rule:
Uruguay makes sure that you do not pay taxes twice. If you pay somewhere
else, Uruguay does not tax you again.
There is no need for Uruguay to
have a signed treaty with the country in which you pay taxes, so the
rule applies equally to everyone. In essence, Uruguay has chosen to unilaterally
recognize any payment in any country (without the need for a treaty) when
it comes to ensuring that you are not taxed twice. |
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The above rules apply to individuals.
For Uruguayan companies (corporate vehicles) that generate income abroad,
there are no taxes to be paid in Uruguay.
 How
To Get A Residency And A 2nd Passport Visa In Uruguay
- Uruguay is an open country to foreign citizens. Not only to those
doing business or buying property, but also to those seeking legal residency.
Any foreign citizen that meets certain basic requirements may apply for
residency. And, if one wishes to, one can subsequently apply for
citizenship, and a second passport. The most important thing you should
bear in mind is that Uruguay does not have an immigration quota, nor does
it discretionally reject applications. As long as you meet the simple
requirements that are listed below (birth certificate, clean police record,
proof that you can support yourself, an address, and time spent in the
country), the residency is granted. It is the manifest policy of
the government to invite people to move to Uruguay. Once you become a permanent
resident, there is no longer a stay requirement. You will lose your
resident status only if you stay out of the country for more than 3 years. |
 Why
Uruguay is a Favorite with both Investors and Those Seeking a New Residency
by Juan Federico Fischer - Uruguay has
a dozen free trade zones (FTZ), in different parts of the country.
Some FTZs are simply warehouses, others have office parks, and some offer
a mix of both. Hundreds of global and regional companies are established
in Uruguay´s FTZs (including the likes of Merrill Lynch, Royal Bank
of Scotland, Tata, RCI, Sabre and Epson). Companies established in a FTZ
may engage in logistics and warehousing; provide services to clients worldwide
(including financial and insurance services); operate in the handling;
classification and selection of merchandise, and even manufacturing. The
main advantage that FTZs offer is total tax exemption of Uruguayan taxes
(current or future ones). The only tax that must be paid is social security
tax on local labor. Thus, a user of a FTZ will neither face import taxes
or duties (since a FTZ is considered non-Uruguayan territory from a customs-duty
perspective), Income Tax, Capital Tax, or VAT. The law guarantees
the FTZ user that all tax breaks, as well as any other rights and benefits
shall remain unchanged during the term of the user agreement. |
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Uruguay
Farmland Investing offers high-yielding cropland
- [pdf] - One of the world´s most suitable
countries to invest in agricultural land, to meet the increasing global
demand for food. Transparent market, without government intervention.
Turnkey purchase, with possibility to lease land or have a farm management
company run it for you.
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 Juan
Federico Fischer is the Managing Partner of FISCHER & SCHICKENDANTZ
Uruguay's preeminent law firm. He can assist on matters related to residency
in Uruguay, corporate structures in Uruguay and investing in Uruguay. His
firm is highly recommended by numerous expats, both for its range of services
and its integrity. - "Fischer & Schickendantz is one of Uruguay´s
leading law and foreign investment advice firms. Our practice covers all
of the main branches in the legal profession. In addition, at Fischer &
Schickendantz we provide accounting and tax advice services, thanks to
the composition and background of our members. This makes Fischer &
Schickendantz unique, as a one-stop firm for a foreign client’s advice
needs." |
FISCHER & SCHICKENDANTZ Rincón
487, Piso 4 Montevideo 11000, Uruguay Tel: (+598) 2 915-7468 ext.
130 Cell: (+598) 99 925-106 Fax: (+598) 2 916-1352 jfischer@fs.com.uy http://www.fs.com.uy |
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| Casa
Pueblo - Punta del Este, Uruguay |
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| Palacio
Salvo - Montevideo, Uruguay |
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