What taxes are applicable on a transfer of property?
The tax regime on properties in Uruguay at the time of writing is as follows. It’s worth noting that the rateable value of the property is usually much less than the real value.
Asset Transfer TaxIn Spanish is Impuesto a las Transmisiones Patrimoniales (ITP)
This tax is payable at the time of purchase and also on any later sale, whoever the purchasing or selling party is. The rate of tax is 2% of the rateable value of the property. Remember the rates are normally considerably less than the real value.
Income Tax on Physical Persons or Income Tax on Non-ResidentsImpuesto a la Renta de las Personas Físicas (IRPF) or Impuesto a la Renta de No Residentes (IRNR)
This tax is only payable by physical persons on the sale of the property and is the equivalent of a capital gains tax. It is payable at the rate of 12% on the difference between the original purchase price and the sale price. It is adjusted to take inflation into account.
Wealth TaxImpuesto al Patrimonio
This tax is paid annually as follows:
- by physical persons–residents or not–whose assets in Uruguay are over apx 130,000 USD. The tax is paid annually on a sliding scale starting at 0.7% and topping 2.8%, based in the case of physical persons on the rateable value of the property. A person’s principal residence is valued at 50% of its rateable value for the calculation of this tax, or
- by legal persons at the rate of 1.5% of the purchase value of the property (the price is adjusted for inflation).
Primary Education TaxImpuesto de Enseñanza Primaria
This is a minor tax payable annually at a rate of between 0.15% and 0.30% of the rateable value of the property.
Rates or annual property taxesContribución Inmobiliaria
An annual tax payable to the local government at a rate of between 0.25% to 1.40% on the rateable value of the property.
Read more about buying a property in Uruguay
Mark Teuten is a British lawyer based in Montevideo since the 1990s. He has law degrees from both the UK and Uruguay. He can help you with your residency applications, setting up a registered company and other legal matters. Guru’Guay has recommended him to our readers who have praised his trustworthiness, clarity, prompt communication even over great distances and careful advice regarding courses of action.
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