Uruguay Corporate Tax - Guide for International Expansion

Are you planning to do business in Uruguay? Then it's essential to understand how corporate income tax works and what it means for your company.

In this guide, we'll break down everything you need to know about corporate taxes in Uruguay, from understanding the tax rates to staying compliant. Whether you're launching a new venture or expanding your business to this South American market, understanding your tax obligations is key to running a successful operation. And if you're looking for smart ways to manage international payments, we'll also show you how Wise Business can help simplify cross-border transactions and keep your finances running smoothly.

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This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Wise Payments Limited, its subsidiaries or affiliates, and it is not intended as a substitute for obtaining business advice from a tax advisor or any other professional.

Uruguay Corporate tax rate in 2025

The standard corporate income tax rate in Uruguay is 25% for most companies. Uruguay applies a territorial tax system, meaning that only income derived from Uruguayan sources is subject to taxation. Foreign-source income is generally exempt, which provides tax advantages for international businesses.¹

Companies engaged in specific activities may benefit from reduced rates or exemptions. For instance, entities operating in free trade zones enjoy significant tax benefits, including exemptions from corporate income tax on activities conducted within the zone. Additionally, Uruguay offers several investment promotion regimes that grant tax incentives for qualifying projects in sectors such as forestry, tourism, and manufacturing.²

Overall, Uruguay maintains a competitive corporate tax environment compared to regional averages, making it an attractive destination for foreign investment in South America.

How to pay corporate tax in Uruguay

Corporate taxes in Uruguay are administered by the General Tax Directorate (Dirección General Impositiva – DGI), which operates under the Ministry of Economy and Finance (Ministerio de Economía y Finanzas). Companies must register with the DGI and obtain a Tax Identification Number (Registro Único Tributario – RUT) before commencing operations.³

The corporate income tax year generally runs from 1 January to 31 December, and companies are required to file their annual income tax return by the end of the fourth month following the date of the year-end.⁴

Uruguay requires companies to make monthly advance payments of corporate income tax based on the prior year’s liability. After year-end, the company determines its final tax charge, and any difference between this amount and the advance payments must be settled by the end of the fourth month following the close of the fiscal year.⁴

Let's say your company has a turnover of $1.5 million USD (approximately 60 million UYU at current exchange rates) and operates with a profit margin of 10%, giving it a taxable profit of 6 million UYU.

At Uruguay's standard corporation tax rate of 25%, the tax owed would be:

6,000,000 UYU × 25% = 1,500,000 UYU (approximately $37,500 USD)

When expanding your business to Uruguay, the right financial tools will make the process smoother. Using a platform like Wise Business makes it easy to manage international finances. A multi-currency account allows businesses to pay for incorporation costs, registration fees, and government taxes in local currency without paying high exchange rate fees.

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Tax Compliance in Uruguay

The important steps to help your company stay compliant with tax regulations in Uruguay:

• Register for taxes early: After incorporation, register with the General Tax Directorate (DGI) to avoid penalties. Businesses must pay Corporate Tax, VAT, personal income tax, non-resident income tax, wealth tax, excise tax, and other sector-specific obligations. Many firms work with corporate tax attorneys or international corporate tax advisors to ensure accurate filings.⁵
• Appoint a legal representative: Every company in Uruguay must designate a legal representative who will act before authorities and guarantee compliance with corporate regulations.
• Comply with Central Bank declarations: Companies must disclose their ownership structure to the Central Bank of Uruguay (BCU), identifying their Ultimate Beneficial Owners (UBOs). An annual declaration of foreign capital investment is also mandatory. Any change in UBO must be reported within 30 days.⁶
• Meet corporate tax deadlines: Companies may choose their fiscal year-end, except in regulated industries. Corporate income tax (CIT) and net wealth tax (NWT) are self-assessed, with returns due by the end of the fourth month after year-end. Businesses must pay corporate and capital taxes monthly in advance, based on the prior year’s liability. A final adjustment is due within four months after closing.
• Understand tax audits and penalties: Taxpayers can appeal an administrative act to the DGI and the Executive Branch within ten days. If denied, appeals can be escalated to a special court. The statute of limitations is five years, extended to ten in cases of fraud, unregistered activity, or failure to submit returns.⁴

Following these requirements helps companies avoid penalties and ensures smooth operations when expanding into Uruguay.

International Expansion to Uruguay

Uruguay is ranked among the most stable economies in Latin America, with a GDP per capita of around USD 21,000 in 2024, one of the highest in the region. The country has maintained steady economic growth over the past decade and consistently attracts foreign direct investment with its transparent institutions and business-friendly policies. Its location between Argentina and Brazil allows businesses to reach a regional consumer market of 400 million people.⁷

The Uruguay corporate tax rate is 25% under the corporate income tax (IRAE).⁸ Companies pay tax on a territorial basis, which means only income generated within Uruguay is taxable. This makes it relatively easy for foreign investors to understand how to calculate corporate income tax. Also, in the Global Innovation Index 2024, Uruguay holds 62nd out of 133 economies and ranks 29th among 184 countries in the Index of Economic Freedom. Its free trade zones provide exemptions from corporate tax, VAT, and customs duties.⁹ It encourages investment in logistics, manufacturing, and IT services.

Moreover, this region also benefits from a highly educated workforce. More than 70% of young people complete secondary education, and English proficiency is higher than the regional average.¹⁰ The country ranks first in Latin America for internet penetration, with more than 88% of households connected, making it an ideal hub for technology-driven businesses.¹¹

Now, let’s see how companies can set up operations in Uruguay:¹²

1. Conduct market research to understand the local demand.
2. Develop a business plan aligned with Uruguay’s economic sectors.
3. Select a legal structure such as a corporation (S.A.) or a limited liability company (SRL).
4. Register with the National Registry of Commerce.
5. Obtain a tax ID with the General Tax Directorate (DGI).
6. Establish reliable accounting and compliance systems.

These steps position Uruguay as a practical entry point into South America, supported by strong tax incentives and a stable business environment. Research how competitors operate here andhow to grow with international business accounts to ensure you’re all set when making an entry here.

Incorporation of Business in Uruguay

To incorporate a business in Uruguay, you’ll need to register with the National Registry of Commerce (RNC) and complete several steps:¹³

• Hold an Assembly: Define the company’s name, registered office, business activity, shareholding structure, profit distribution, management system, and partnership term (maximum 30 years).
• Register with the RNC: Submit notarised Articles of Incorporation, a commercial registration certificate, and proof of enrollment in the Single Tax Registry (RUT).
• Publish the Incorporation: Announce the company’s creation in the Official Gazette and a local newspaper, which finalises the legal recognition of a Limited Liability Company (LLC).

Once incorporated, Uruguay’s corporate tax policies come into effect:

• Federal corporate tax rate: 25% under the Impuesto a la Renta de las Actividades Económicas (IRAE).
• Corporate tax account: Companies must maintain an account with the General Tax Directorate (DGI) for compliance and payments.
• Corporate tax filing deadline: Returns are typically due within four months after the end of the fiscal year.
• Corporate tax refund: Possible when advance tax payments exceed the company’s final liability.

Types of Businesses in Uruguay¹⁴

• Partnerships (SRL): Capital is divided into equal, non-negotiable, and indivisible quotas. Liability is limited to each partner’s contribution, with a maximum of 50 partners.
• Corporations (S.A.): Shareholders’ liability is limited to their shares. Can be open (publicly traded, able to issue debt) or closed (privately held, no public debt).
• Unlimited Companies: Members are jointly and severally liable for all company obligations.
• Limited Partnerships: Combine general partners with unlimited liability and limited partners liable only up to their contribution.
• Limited Shareholding Partnerships: Include partners with unlimited liability and others only liable for the value of their shares.
• Mixed Companies (Capital and Labour): Capital partners carry full liability, while labour partners are only liable for unperceived profits.

These structures allow investors to choose the entity type that best matches their risk tolerance, capital requirements, and long-term business goals.

International corporate tax best practices

Here are some of the best strategies to ensure compliance with local tax laws, save money, and reduce tax burdens when operating internationally.

Stay compliant with local and international tax laws by completing the legal registration process in every country where your business operates. File all required tax returns on time to avoid penalties, and ensure you stay up to date with local tax laws to remain fully compliant. Companies should also understand and adhere to global standards set by organisations like the Organisation for Economic Co-operation and Development (OECD), including frameworks like Base Erosion and Profit Shifting (BEPS).

Leverage double taxation treaties (DTTs) to ensure you're not taxed on the same income twice. Uruguay has signed double taxation agreements with numerous countries, including the UK, Spain, Germany, and other major trading partners, which can significantly reduce your overall tax burden.

Maintain up-to-date and transparent financial records to help prepare accurate tax returns, reducing the risk of errors that could lead to penalties. Having organised financial records also simplifies the process during tax audits and demonstrates good corporate governance to local authorities.

Take the complexity out of international expansion with Wise Business

Researching corporate tax is a crucial step when expanding your business into a new country. The next step is setting up the financial infrastructure to handle the complexities of operating across borders, from managing multi-currency cash flow to mitigating FX risk.

The Wise Business account provides the financial tools to make your international expansion to Uruguay efficient and simple. It's the one account for managing your money globally.

With a Wise Business account*, you can:

• Pay suppliers and initial fees: Pay suppliers, global payroll, and one-off incorporation costs in the local currency.
• Manage your money across borders: Hold and exchange 40+ currencies in one account, always with the mid-market exchange rate and low, transparent fees.
• Streamline your accounting: Integrate with tools like Xero or QuickBooks to simplify tracking your company's international finances.
• Empower your team: Provide multi-user access for your finance team and issue expense cards for international spending.

Wise is designed to support every step of your journey, from paying your first registration fee to receiving international payments and managing your global treasury.

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