Uruguay Tax Holiday 2026: tax residency and the new 11-year regime

1. From the original tax holiday to the 2.0 regime

The tax holiday regime for individuals in Uruguay rests on the Personal Income Tax (IRPF), created by Law 18.083 on Tax Reform (2007). IRPF began to tax foreign movable-capital income only with Law 18.718 (2010), applicable from 2011. As a counterpart, the legislation allowed anyone who acquires tax residency in Uruguay to elect, once only, to be taxed under the Non-Resident Income Tax (IRNR) for a set period, instead of joining the general IRPF regime immediately.

The tax holiday as such was born with Law 18.910 (25 May 2012), which added article 6 Bis to Title 7 and set the benefit at 6 tax years: the text says “for the tax year in which the change of residency to national territory takes place and during the following five tax years”, so the year of acquisition counts and five more are added, not four. Law 19.904 (18 September 2020) extended that period to 11 tax years (year of acquisition + 10 following) and also introduced the option of paying IRPF at 7% with no time limit —today in letter B) of article 37 of Title 7—. Decree 163/020 (2020) did not change the holiday period: it created new residency grounds based on investment, clarified six days later by Decree 174/020, whose wording of art. 5-BIS of Decree 148/007 is the one that remained in force.

The two alternative routes introduced by Decrees 163/020 and 174/020 were:

• Real estate route (art. 5-BIS of Decree 148/007, as worded by Decree 174/020): investment in property worth more than UI 3,500,000 (approximately USD 380,000-400,000 when issued) made from 1 July 2020, with a minimum physical presence of 60 days during the calendar year.
• Business route: direct or indirect investment in a company worth more than UI 15,000,000 (approximately USD 1,500,000-1,700,000 when issued) that created at least 15 new direct full-time jobs.

The regime proved particularly attractive to Argentine residents and those of other countries with heavier taxation of foreign capital income.

The new Government, in Law 20.446 on the National Budget 2025-2029, in force since 1 January 2026, kept the logic of the tax holiday but recalibrated its parameters. The structural changes reach those who acquire tax residency from 1 January 2026 and elect the tax holiday:

Stepped rate structure

The earlier regime (Law 19.904) provided 11 tax years at a zero rate and, once the period ended, a direct move to the general IRPF regime that applied to each type of income (article 37 of Title 7). Law 20.446 introduces an intermediate step for the 5 tax years following the initial period (years 12 to 16): once the initial period ends, the general IRPF regime that applies to each type of income comes back into force (article 37 of Title 7), without prejudice to the later options in article 24-Bis itself; among them, it enables the option —once only and conditional on a qualifying investment— of paying a reduced rate of 6% (half the statutory rate). From year 17, the general regime applies (currently 12% for these items), unless the flat annual amount option that the law itself enables, within its applicable time limit, is exercised.

Real estate threshold raised to UI 12,500,000

To elect the article 24-Bis regime, the real estate investment must exceed UI 12,500,000 (approximately USD 2,000,000). The UI 3,500,000 threshold was not repealed: it continues to operate as a ground for tax residency, which is a prior step, distinct from access to the benefit. Amounts are expressed in indexed units (UI) to preserve real value against inflation; the dollar equivalent fluctuates with the exchange rate.

The higher threshold narrows access through the real estate route. As for the physical presence required by the old real estate route, there is a development that should not be taken for granted —the detail and the source are in Route 2—.

New route through innovation funds

Law 20.446 added an alternative centred on innovation: contributing at least UI 625,000 a year (approximately USD 100,000) to investment funds intended to finance productive projects, research or innovation applied to production, as the regulations determine. The annual requirement must be coordinated with each tax year in which this condition is to be used; it is subject to the formalities, terms and conditions set by the Ministry of Economy and Finance. The business investment of the earlier regime (UI 15,000,000 and 15 jobs) remains a ground for tax residency before DGI; what it no longer does, on its own, is open access to the holiday.

Conditional 6% exit option instead of a direct 12%

Once the 11 tax years of the initial period have ended, the general IRPF regime that applies to each type of income comes back into force (article 37 of Title 7), without prejudice to the later options in article 24-Bis itself. Law 20.446 enables, once only, the option of paying 6% for 5 additional tax years, but conditional on a qualifying investment: contributions of UI 625,000 a year to funds for productive projects or innovation, which the law requires to be met in each of those tax years, or the real estate condition requiring a value above UI 6,250,000, assessed under article 5-SEPTIES. The property condition for the later reduced-rate option must be assessed under article 5-SEPTIES, including its restrictions on amounts already used to establish residence or qualify for the initial holiday; the original property investment does not automatically satisfy this later condition. The reduced-rate option is subject to a single election and a fixed statutory window; a later election does not create a fresh five-year period. There is also an alternative option: paying IRPF at a flat annual amount (UI 1,875,000, reducible to UI 1,250,000 if presence of more than 183 days in the calendar year, counted under article 2(A) of Title 7 and article 5-Bis of Decree 148/007 (including the rules on sporadic absences) or a qualifying capital contribution above UI 45,000,000 in a company is shown, under the conditions of art. 5-SEPTIES; a spouse who elects the option pays 15% of the corresponding flat amount); the fixed-amount option is exercised annually, within its applicable time limit. If the conditions for the reduction are not met, the general flat amount stays at UI 1,875,000; when no later option is exercised, the general regime applies (currently 12% for these items).

The rates mentioned correspond to IRPF Category I on the income covered by item 2 of article 6, under Title 7 of the 2023 Consolidated Text (Decree 101/024), as amended by Law 20.446. The 12% is the “Other income” rate (“Restantes Rentas”) of letter B) of article 37 of that Title. The intermediate 6% rate does not appear as such in the law: article 24-Bis speaks of paying “at 50% of the corresponding rate”, and that is where the 6% comes from while the statutory rate remains 12%. If that rate changed, the intermediate step would change too. The complete line of rates and periods is in the timeline.

2. The three qualifying routes

To access article 24-Bis you must first acquire tax residency through a ground under article 2 of Title 7 (presence of more than 183 days, centre of economic or vital interests, or another recognised ground, including the real estate ground of article 5-BIS letter c), which cumulatively requires an investment above UI 3,500,000 since 1 July 2020 and 60 days of actual presence in the calendar year). Then, to exercise the initial holiday option, you must meet the UI 12,500,000 real estate investment, the annual capitalisation in funds, or else establish presence of more than 183 days in each relevant calendar year, counted under the statutory rules. Buying the property or contributing to the fund, on their own, do not create tax residency: they are conditions for electing the benefit of a person who has already acquired it by another route.

Route 1 — Physical presence

Presence route: more than 183 days in each relevant calendar year, counted under letter A) of article 2 of Title 7 of the 2023 Consolidated Text and article 5-BIS of Decree 148/007. The calculation includes the statutory rules on sporadic absences and excludes qualifying transit days. It is the simplest route and requires no investment, but it demands actual physical presence in each tax year in which you wish to use the option: the third paragraph of article 24-Bis allows election without investment for those who meet that condition “in each tax year”. A year below the threshold, with no qualifying investment to back it, leaves that tax year outside the benefit. Failure to meet the relevant conditions can leave a tax year outside the benefit. The benefit may apply again when the conditions are met, but the original statutory window does not pause or restart. The calculator assumes eligibility throughout that window.

The counting of days is set by article 5-BIS of Decree 148/007 through three concrete rules: all days of actual physical presence are counted, whatever the time of entry or exit; days in transit as a passenger between third countries are not counted; and absences are regarded as sporadic —that is, they add to presence and do not subtract from it— as long as they do not exceed thirty consecutive days, unless the taxpayer proves tax residency in another country. That proof is made exclusively by a certificate issued by the competent tax authority of the other State: one’s own statement or a foreign tax return does not replace it.

Route 2 — Real estate investment

This route requires investing in property worth more than UI 12,500,000 (approximately USD 2,000,000), as the regulations establish (art. 24-Bis, letter a). Article 5-SEXIES of Decree 148/007, added by Decree 188/026 and amended by Decree 225/026, sets the conditions: the value is measured with the UI rate of the last day of the month before the investment; property acquired from 1 September 2025 counts; urban property located in departments with no coast on the River Plate or the Atlantic Ocean increases its tax cost by 100%, and the properties may coincide with those taken into account to establish tax residency under article 5-BIS.

It is worth not confusing two dates. To enter the regime, tax residency must be acquired from 1 January 2026. For the real estate route, article 5-SEXIES takes property acquired from 1 September 2025. Property acquired before that date does not meet this condition of the article 24-Bis real estate route; its possible relevance for residency grounds or earlier regimes is analysed separately. The article 24-Bis real estate condition has no minimum presence requirement of its own. However, if tax residence is established under article 5-BIS(c), that separate residence criterion still requires at least 60 days of actual presence in the calendar year. The benefit condition does not replace the residence requirements.

Route 3 — Contributions to investment funds for innovation

The third route, introduced by Law 20.446, consists of capitalising, as the regulations determine, investment funds intended to finance productive projects, research or innovation applied to production. The minimum contribution is UI 625,000 (approximately USD 100,000) a year (art. 24-Bis, letter b); how to provide evidence of and maintain this condition during the initial period must follow the formalities, terms and conditions set by the MEF.

The law does not call those vehicles “venture capital funds” nor does it require the Executive Branch to approve each fund separately. The route is provided for, but its concrete implementation depends on the formalities, terms and conditions the MEF sets. Decree 95/026 (06/05/2026) regulated tax aspects of the regime; DGI Resolution No. 1517/026 (29/06/2026) implemented, among other matters, withholdings, verification of options by impatriates and the tax cost of foreign assets. Decree 188/026 regulated this route by adding article 5-SEXIES, with a minimum annual capitalisation of UI 625,000. The article itself provides that the funds must meet the formalities, terms and conditions set by the Ministry of Economy and Finance. Use of the investment-fund route must be checked against the MEF formalities, terms and conditions applicable to the proposed fund and contribution. This page does not confirm that a particular fund qualifies.

In addition to the three routes above, the legislation contemplates the traditional grounds for establishing tax residency through a centre of economic or vital interests in Uruguay (volume of economic activity, spouse and children in Uruguayan territory). These grounds operate independently of the three routes detailed for the TH and may establish residency even without meeting 183 days of physical presence.

3. Additional requirements and the election with DGI

Beyond the qualifying route chosen, an individual who wishes to elect the tax holiday must meet two cumulative conditions:

• Not having been a tax resident in Uruguay during the two tax years immediately preceding the tax year in which the option is exercised. The rule prevents someone who already lived in Uruguay from using the holiday on “returning” after a short absence.
• Not having applied the regime of the previous article —article 24, which is the previous holiday—, “except for the situations provided for in the following paragraph”, which is the exception the rule itself reserves for those who have already exhausted or are exhausting that regime. The article 24-Bis option, moreover, is exercised once only. Previous use of article 24 does not create a new initial eleven-year holiday under article 24-Bis; the provisions for former article 24 beneficiaries concern the later options and must be assessed separately.

In addition, the formal option must be exercised before the Tax Authority (DGI). DGI Resolution No. 2.158/026 set the form: the initial election is made once by filing a sworn declaration (declaración jurada) with DGI and is irrevocable (item 1), and whoever files it must provide evidence to DGI, for each tax year, of the investment condition or the presence that applies, even in tax years without covered income, by 31 January of the following year (item 4). That deadline is for the annual evidence, not for the election. Resolution No. 2.158/026 does not specify a filing deadline for the initial article 24-Bis declaration. The applicable filing procedure, supporting documents and timing must nevertheless be checked with DGI before relying on the election. Failing to elect means falling under the general IRPF regime. As a prudent preparation, it is advisable to keep the record of the change of residency and the supporting evidence of presence or investment according to the route chosen; what must be provided and through which channel will depend on DGI’s instructions. Annual evidence of the benefit and an application for a tax residence certificate are different procedures.

The withholding mechanism is operational, and it is no minor detail. Decree 95/026 added articles 44-QUINQUIES and following to Decree 148/007, which designate withholding agents on foreign income. The relevant withholding provisions use 8% (article 44-SEXIES) or 12% (article 44-OCTIES), depending on the designated agent, with 6% or 7% for specified elections. These are withholding rates. Their treatment as payments towards the final liability or as definitive taxation depends on the applicable rules and any valid election. Where a designated withholding agent is involved, the required declaration must be supplied to that agent, and the agent, under item 19 of DGI Resolution No. 1517/026, must also verify the election’s validity on DGI’s website before paying, crediting or allocating the covered income.

4. Earlier regime and transition

Law 20.446 addresses the situation of taxpayers who acquired tax residency and elected the tax holiday before 1 January 2026. The general rule is preservation of acquired rights (grandfathering): they keep the conditions of the regime in force when they elected, until the original period runs out. In general terms:

• Anyone who elected under the earlier regime (Law 19.904, tax holiday of 11 tax years at zero rate) continues with those conditions until the close of tax year 11. DGI Resolution No. 2.158/026 (item 6) adds that options exercised under DGI Resolutions No. 2.481/020 and 898/021 are deemed made for all the income under item 2 of article 6 —yields and capital gains—, unless the taxpayer states that their option includes only the yields (paragraph I). Once the period ends, article 24-Bis provides that those who used the option of the previous article “may only exercise the option referred to in the preceding paragraph”. DGI Resolution No. 2.158/026 provides that this option is exercised under the same conditions as those of the fifth paragraph (item 3) and requires evidencing, as appropriate, the conditions of its two sub-paragraphs (item 4): the reduced 6% rate, conditional on a qualifying investment, and the flat amount, subject to its time limit. DGI’s reading, then, does not limit them to the flat amount. Since the statutory cross-reference is not entirely unambiguous, for a decision that depends on this point a binding ruling is still advisable.
• Anyone who acquired residency under the original regime of Law 18.910 (6 tax years: the year of the change plus the following five) and elected in due time keeps those conditions. That article 24 regime was closed going forward: article 649 of Law 20.446 replaced its first paragraph to provide that the option “may be exercised once only and up to 31 December 2025”, a date repeated by article 1 of Decree 188/026. Although the statutory text keeps 31/12/2025, DGI Resolution No. 2.158/026 (item 7) provided that the article 24 option may be exercised up to 31/12/2026.
• Tax residency must be acquired from 1 January 2026 to enter article 24-Bis; the property that supports the real estate route, by contrast, must have been acquired from 1 September 2025 (article 5-SEXIES, as worded by Decree 225/026). An investment before that date does not serve this route. If residency was established through the real estate ground of art. 5-BIS letter c), its investment and presence requirements had to be met separately (UI 3,500,000 since 1 July 2020 and 60 days); once residency was acquired, access to the holiday also depended on having validly exercised the option, and anyone who did keeps their conditions; if residency was acquired before 2026 and the option has not yet been exercised, there is no automatic move to article 24-Bis: the new regime is intended for those who acquire tax residency from 1 January 2026, and the earlier option is governed by article 24: although the statutory text keeps 31/12/2025, DGI Resolution No. 2.158/026 (item 7) provided that it may be exercised up to 31/12/2026. For anyone who does acquire residency from 2026, a real estate investment of USD 800,000 does not by itself reach the UI 12,500,000 threshold of the real estate route.

Law 19.937 introduced an extension for individuals who had used the original IRNR election. Under article 5-QUINQUIES and DGI’s published guidance, the tax years already used are deducted from a maximum of ten; this is not a fresh ten-year benefit. DGI’s guidance includes an extension exercised after the original period had expired, so uninterrupted use should not be assumed. The qualifying property investment and at least 60 days of actual presence must be evidenced for each covered tax year. Any remaining opportunity to exercise the option must be checked against the current article 24 transition and the individual’s history.

The change of regime also raises transitional technical questions that should be reviewed case by case:

• People who acquired residency in 2025 and did not exercise the option by 31 December 2025: although the statutory text keeps 31/12/2025 (article 24, as worded by article 649 of Law 20.446), DGI Resolution No. 2.158/026 (item 7) provided that the article 24 option may be exercised up to 31/12/2026. If the option was exercised but is pending formalisation or evidence, the DGI instructions applicable to the case should be checked.
• Real estate investments in progress on 1 September 2025: those made with a signed purchase agreement (boleto) and deposit paid before that date, but deeded afterwards, require particular analysis. Article 5-SEXIES takes property acquired from 1 September 2025, without expressly resolving when property is deemed acquired in these cases, so the treatment should not be assumed from the date of the agreement or of the deed alone without analysing the specific transaction.
• Tax cost of foreign assets: specific rules apply from 2026 (art. 29-TER of Decree 148/007). For certain assets acquired before 31 December 2025, the regime provides as tax cost their quoted value at that date: those listed on recognised stock exchanges and those that appear in the MEF and BCU information systems that DGI determines; there is also an annual option to determine the income by applying 20% to the sale price. The applicable cost and documentation depend on the type of asset and the rule that applies.
• Double taxation treaties: the change of residency triggers specific clauses in bilateral treaties. Planning before the fiscal close of the year in the country of departure can affect the taxpayer’s position.
• Pre-existing corporate structures: companies, trusts and funds where the individual is the ultimate beneficiary require review under tax transparency rules and the change to the dividend regime introduced by Law 20.446 itself.

Each of these points requires specific advice. Law 20.446 also introduced relevant collateral changes —the Domestic Minimum Complementary Tax (IMCD), created by its article 665 as Title 21 of the 2023 Consolidated Text, which reaches multinational groups whose ultimate parent entity’s consolidated financial statements show annual revenues equal to or above € 750,000,000 in at least 2 of the 4 tax years immediately preceding the one examined; the tax on indirect transfers of shares; the adjustments to the taxation of dividends— that may affect the overall tax planning of the taxpayer and their asset structures.

5. Scope of the benefit and the country of origin

The tax holiday regime in Uruguay is technically an option of the new tax resident: instead of paying IRPF Category I on foreign movable-capital income (taxed since Law 18.718 of 2010), they elect to pay under IRNR, during the legal period, exclusively the income covered by item 2 of article 6. The practical effect is that such income, obtained during the tax years of the initial period in which the applicable conditions are met, is outside the scope of Uruguayan taxation under this regime.

The scope is defined by a specific cross-reference: article 24-Bis leads to article 6, item 2, of Title 7, which regulates capital income from non-resident entities. That is why the holiday covers exclusively certain capital income from non-resident entities included in that item 2 —for example, interest on deposits and bonds or dividends from foreign companies—, with its statutory exclusions, and the capital gains linked to the assets covered by that rule, such as gains on the disposal of financial instruments (paragraph II of that item, as worded by article 653 of Law 20.446). It is not a general exemption for all passive income earned outside Uruguay.

The practical consequences are:

• Income under item 2 of article 6: in the tax years of the initial window in which the applicable conditions are met, outside the scope of Uruguayan taxation under this regime. Foreign entities and trusts may affect income attribution and reporting obligations. The applicable obligations must be checked against the structure, ownership and relevant DGI rules; the holiday does not establish that no reporting is required.
• Uruguayan-source income: the person under the tax holiday remains a resident for all Uruguayan purposes. The holiday does not cover Uruguayan-source income. That income remains subject to the Uruguayan tax rules applicable to the activity, taxpayer and income concerned.
• Wealth Tax: a resident under the tax holiday may be subject to Wealth Tax on assets in Uruguay, under the tax’s general rules and the non-taxable minimums in force. Assets located abroad are, in general, not reached by Uruguayan Wealth Tax (with specific technical exceptions).
• Social security contributions: independent of the tax holiday regime. Anyone earning income from personal activity in Uruguay is subject to the social security rules applicable to that activity.
• Legal entities: the regime is exclusive to individuals who acquire tax residency in Uruguay. Uruguayan companies pay Business Income Tax (IRAE) under the general rules, regardless of whether their shareholders or ultimate beneficiaries are new residents with a personal tax holiday.

Taxation in the country of origin requires a separate analysis. Uruguay has broad double taxation treaties with Brazil (Law 20.009), Spain (Law 18.730), Germany and other countries. With Argentina there is no broad treaty. There is, instead, the 2012 Agreement on tax information exchange and a method to avoid double taxation (Law 19.032). Its Title III contains a residency tie-break rule (article 9, paragraph 3) and the credit method (article 11), but it does not allocate taxing rights by type of income as a comprehensive treaty does.

Acquiring Uruguayan tax residence does not establish your tax position in another country. We advise on the Uruguayan side and, where necessary, coordinate with your adviser abroad. Advice on that country’s domestic rules must come from that adviser.

6. The decision does not end with the rate

The Tax Holiday 2.0 regime introduces greater selectivity and a transitional step. Raising the real estate threshold filters the target audience towards larger estates; the new innovation fund route opens a non-real-estate door; the 6% option for 5 additional tax years —conditional on a qualifying investment— can soften the exit towards the general regime. For those already under the earlier regime, the rule is the preservation of acquired rights.

The tax saving is only part of the decision. The composition of assets, the expected annual income from abroad, the situation in the country of origin, lifestyle and the available timelines also count: the decision belongs to overall tax planning, not only to the rate. The regime requires an actual change of residency, with personal and financial consequences that do not fit into a simulation.

If you are Argentine and are weighing the move, see our page for accountants for Argentines in Uruguay (in Spanish). You can also see the related articles on Uruguayan tax regimes and taxes for independent professionals in Uruguay (in Spanish).

Scope notes for the overview

Scope: the regime covers exclusively the income under item 2 of article 6 of Title 7; it is not a general exemption for all passive income from abroad.

UI to USD conversions: USD equivalents are illustrative and are not legal thresholds. Eligibility must be assessed in UI using the valuation date prescribed by the applicable rule.

What is documented before electing

• Cumulative conditions. Not having been a tax resident in Uruguay during the two tax years immediately preceding, and not having applied the regime of the previous article, except for the exceptions the rule itself provides.
• Deadline. The initial election is a single, irrevocable sworn declaration (declaración jurada) with DGI. DGI Resolution No. 2.158/026 (item 1) does not specify a filing deadline for it; the applicable filing procedure, supporting documents and timing must nevertheless be checked with DGI before relying on the election. 31 January of the following year is the deadline to provide evidence, tax year by tax year, of the investment condition or the presence, even in years with no covered income; it is not a deadline to make the election (item 4). The formalities of the funds route are set by the MEF: before electing, the instructions in force should be checked.
• Prudent preparation. Keep the record of the change of residency and the supporting evidence of presence or investment according to the route (deed, certificate of contribution, proof of presence).
• Withholding. Decree 95/026 added articles 44-QUINQUIES and following to Decree 148/007, which designate withholding agents. The relevant withholding provisions use 8% (article 44-SEXIES) or 12% (article 44-OCTIES), depending on the designated agent, with 6% or 7% for specified elections. These are withholding rates. Their treatment as payments towards the final liability or as definitive taxation depends on the applicable rules and any valid election. The 2026 transitional deadlines for remitting those withholdings and the advance payments on foreign yields were rearranged by DGI Resolution No. 1.783/026, of 5 August 2026. Item 19 of DGI Resolution No. 1517/026 requires the agent to verify on DGI’s website that the option is in force before paying, crediting or allocating the income.

Full assumption: Argentine investor

Argentine individual, 55, diversified wealth: USD 5 million in a financial portfolio (shares, bonds, funds in the US and Europe), USD 2 million in an Argentine family company that distributes dividends, USD 1 million in properties for personal use in Argentina. Estimated annual foreign income reached by Uruguayan IRPF: USD 280,000 (foreign interest and dividends).

Modelled scenario: purchase of a property in Punta del Este for USD 2.2 million; for the purposes of the example, its value is assumed to exceed UI 12,500,000. This illustration assumes that Uruguayan tax residence has been established independently, all relevant residence and previous-election conditions are satisfied, the property meets the applicable requirements (art. 5-SEXIES: acquired from 1 September 2025 and valued under that rule), and the IRNR election is validly made. Buying the property alone does not establish eligibility. If those requirements are met, the following applies:

• Tax years 1-11 (2026 to 2036): Uruguayan IRPF on foreign income = USD 0 in this illustration. Annual difference against the general regime (12%), before foreign tax credits: approximately USD 33,600.
• Cumulative difference over the 11 tax years: approximately USD 369,600 (not counting returns on reinvested savings).
• Tax years 12-16 (2037 to 2041): the general IRPF regime returns, currently 12% for these items (approximately USD 33,600 a year). If the 6% is elected and the applicable qualifying investment condition is met, annual tax falls to approximately USD 16,800. If that option does not apply, the general 12% regime or, where appropriate, the flat amount alternative of article 24-Bis should be analysed.

Full assumption: Independent professional with investment income

Argentine, 42, working in international consulting. Wealth: USD 600,000 in a financial portfolio, USD 200,000 in an inherited property in Argentina. Foreign income reached: USD 50,000 a year in foreign interest and dividends. Professional fees are outside this illustration.

Comparison: the wealth indicated does not reach the real estate threshold of UI 12,500,000 (~USD 2 million). The presence route would require more than 183 days in each relevant calendar year, counted under the statutory rules; the funds route requires comparing the minimum annual contribution of UI 625,000 with the available cash flow. Use of the investment-fund route must be checked against the MEF formalities, terms and conditions applicable to the proposed fund and contribution. This page does not confirm that a particular fund qualifies. This illustration assumes that all residence-history and previous-election requirements are satisfied, the IRNR election is validly made, and qualifying presence is established in every relevant calendar year under the statutory counting rules. Annual taxable income and tax rates are assumed to remain constant. Presence alone does not establish entitlement to the benefit.

• Qualifies through physical presence (more than 183 days in Uruguay in each relevant calendar year).
• Tax years 1-11: difference against the general regime of approximately USD 6,000 a year.
• Cumulative difference: approximately USD 66,000 over 11 tax years.
• Critical decision: whether the tax saving justifies the actual change of residency (presence of more than 183 days in the calendar year, counted under article 2(A) of Title 7 and article 5-Bis of Decree 148/007 (including the rules on sporadic absences)) and the associated costs.

Full assumption: Brazilian investor

Brazilian, 68. Diversified financial portfolio in the US and Europe: USD 2.5 million. It generates USD 120,000 a year in interest, dividends and capital gains from abroad. Total wealth ~USD 3 million.

Modelled scenario: purchase of an apartment for USD 2.1 million, subject to the transaction meeting the conditions of article 5-SEXIES and to not having been a tax resident in Uruguay during the two immediately preceding tax years. This illustration assumes that Uruguayan tax residence has been established independently, all relevant residence and previous-election conditions are satisfied, the property meets the applicable requirements, and the IRNR election is validly made. Buying the property alone does not establish eligibility. It also assumes that funding the property purchase does not reduce the annual income entered in the comparison; if the purchase is funded by selling income-producing investments, the projected income must be adjusted.

• Tax years 1-11: annual difference against the general regime of approximately USD 14,400. Cumulative: approximately USD 158,400.
• In addition, it considers the implications of the Brazil-Uruguay treaty to avoid double taxation and anything that depends on Brazilian law must be confirmed with a qualified professional there; we advise on the Uruguayan side and, if needed, speak with them.
• At the end of the period, the capital remains placed in an asset of one’s own, whose value will depend on the area, the time of purchase and the real estate market cycle.

Official sources consulted

Law 20.446, articles 648 and 649. Title 7 of the 2023 Consolidated Text: articles 2, 6, 24, 24-Bis and 37. Decree 95/026. Decree 188/026 of 10 August 2026 and Decree 225/026. Decree 148/007: article 5-BIS (days of presence), article 5-SEXIES and article 5-SEPTIES (the article 24-Bis investment routes), article 5-QUINQUIES (extension for individuals who used the original election), article 44-SEXIES and article 44-OCTIES (withholding) and article 76-Bis (foreign tax credits). DGI Resolution No. 2.158/026. DGI Resolution No. 1517/026 (updated text), read with DGI Resolution No. 1.783/026 (transitional deadlines for withholdings and advance payments, 5 August 2026).

Scope warning

Legal references and note on currency

Historical rules cited: Laws 18.083, 18.718, 18.730, 18.910, 19.032, 19.904, 19.937 and 20.009. Decrees 148/007, 163/020, 174/020 and 101/024.

The rules may change: Decree 95/026 (06/05/2026) regulated aspects of article 24-Bis, and Decree 188/026 (10/08/2026) added articles 5-SEXIES and 5-SEPTIES, which regulate the article 24-Bis investment routes.