Residences in Uruguay and Service
Relocation for Foreigners

Residences in Uruguay and Service Relocation for Foreigners

We advise on migrations, international mobility of executives and investments

We provide legal and advisory services in a wide range of immigration procedures, such as different types of temporary and permanent residence permits.

We advise our clients’ human resources executives on the hiring of national and foreign employees, on labor issues and on compliance with Uruguayan immigration laws. We assist in all practical aspects of relocation: application for residence permits, import of personal belongings and all related issues. We prepare the documentation, carry out its certified translation, verifying that the required formalities are met to prove the source of income and present the required police clearance certificates of the applicant.

Our services include:

Applications for legal residence permits.
Temporary residence.
Permanent residence.
Tax residence.
Re-entry permits.
Importation of personal items.
Citizenship application.
Second passport.
Employment contracts.

Legal Residence

Legal residence is an essential requirement to settle in the country permanently (or for a longer period of time than allowed for tourists). Likewise, it is necessary to obtain a Uruguayan identity document and work in the country, among others.

However, it is not necessary to be a resident to invest in Uruguay.

Legal residency procedures vary depending on the nationality of the foreigner interested and the period for which he or she intends to remain in the country.

Temporary residence: It is required for foreigners who wish to stay in Uruguay for up to 2 years (can be extended for an additional 2 years).
Definitive residence: It is required for foreigners who intend to live in Uruguay permanently.

Tax Residence

In 2020, the Uruguayan Executive Branch approved some decrees that relax the conditions for individuals to obtain tax residence in Uruguay.

It is enough for the individual to meet at least one of the following conditions to be considered a tax resident in Uruguay:

a) Stay more than 183 days during the calendar year in Uruguayan territory.

b) Establish the main nucleus or base of its activities or economic interests in national territory. It implies that the individual generates larger incomes in Uruguay than in any other country individually considered. However, this cause will not be established when the person receives exclusively pure capital income.

Furthermore, unless the natural person proves tax residence in another country, the individual must have an investment in national territory with the following characteristics:

In real estate with a value greater than 15,000,000 Indexed Units (approx. USD 1,670,000).
In a company (directly or indirectly) with a value greater than 45,000,000 Indexed Units (approx. USD 5,000,000) and that said entity carries out activities or projects that have been declared of national interest in accordance with Law 16,906 (Investment Promotion Law).
In real estate for a value greater than 3,500,000 Indexed Units (approximately USD 390,000), carried out as of July 1, 2020, and that the person registers an effective physical presence in Uruguayan territory during the calendar year of, at less, 60 days.
In a company (directly or indirectly) for a value greater than 15,000,000 UI (approx. USD 1,670,000), if it is carried out from July 1, 2020 and generates, from that date, at least 15 new full-time jobs in a dependency relationship, during the calendar year.

c) Establish the center of your vital interests in national territory

This cause is presumed when the person’s spouse and minor children who depend on the person reside in Uruguay, provided that the person is not legally separated from the spouse and that the children are subject to parental authority. In cases where there are no children, the presence of the spouse will be sufficient.

People who acquire the status of tax residents in Uruguay as of fiscal year 2020 may pay taxes exclusively on income from foreign capital as follows:

Option 1: pay IRNR tax for the fiscal year in which they acquire the status of tax resident in Uruguay and for the following 10 years (the previous period of 5 is extended to 10 years). The practical effect of exercising this option is that the income from foreign capital will not be subject to income tax in Uruguay until the end of the period. After completion, said returns would be subject to personal income tax at the general rate of 12%.

Option 2: tax personal income tax at the rate of 7% (instead of the general rate of 12%) with respect to income from foreign capital, without a time limit.

People who acquire the status of tax residents in Uruguay as of fiscal year 2020 may pay taxes exclusively on income from foreign capital as follows:

Option 2: tax personal income tax at the rate of 7% (instead of the general rate of 12%) with respect to income from foreign capital, without a time limit.

Extension of the Window Period for Tax Residents Prior to 2020

Recently, through Law 19,937 and its regulations through Decree 141/021, the window period or “tax holiday” regime was extended for those people who had acquired tax residence in Uruguay before 2020 and had made use of the option of paying the IRNR on the income from movable capital from abroad, for a period of 5 years counted from the calendar year following the one in which tax residence was obtained.

In this sense, they may choose to pay the IRNR in relation to the income accrued from the fiscal year 2021, for up to a maximum period of 10 fiscal years, deducting those for which the first option to pay said tax has been exercised, always when people prove for each fiscal year that they meet the following conditions:

i) Having acquired a property worth more than 3,500,000 Indexed Units (approx. USD 390,000), as of January 22, 2021.

ii) Registering at least 60 days of effective physical presence in the country, in the calendar year.

To use the option, the taxpayer must submit a sworn declaration only once. Likewise, at the close of each fiscal year, the taxpayer must prove to the Uruguayan treasury the fulfillment of the aforementioned conditions through the presentation of a sworn declaration whose deadline may not exceed January 31 of the following year.