Uruguay

Employment income

See the Taxes on personal income section for a description of the taxation of employment income.

Capital gains

Capital gains obtained by individuals (resident or non-resident) upon disposal of shares/quotas in Uruguayan CIT payers are subject to individual taxation at a 12% rate (IRPF or IRNR, respectively).The transfers of titles issued by Uruguayan entities are subject to an effective capital gains tax rate of 2.4% on the transfer price (12% applied to a notional 20% of the transfer price or 20% of market value of the titles transferred if there is no price). The effective rate is of 7.5% when the transferor is an entity resident, domiciled, or located in LNTJs (25% applied to a notional 30% of the transfer price or 30% of market value of the titles transferred if there is no price).

Income derived from the transfer of shares or participations in entities from LNTJs whose assets located in Uruguay exceed 50% of their total investments is deemed to be Uruguayan sourced (thus taxable) for tax purposes.

As from 1 January 2026, in addition to the introduction of a transparency regime, the scope of foreign‑source capital gains and yields applicable to individual tax residents was expanded to include those derived from immovable property. In addition, capital gains from movable property were incorporated into the taxable base of the IRPF.

Dividend income

Before Budget Law 2025-2029, IRNR was applicable on distributions of dividends and profits at a 7% rate, to the extent the earnings that were distributed were subject to CIT (i.e., the distribution was free from IRNR if it is made out of CIT non-taxable income).

Complementing the referred tax treatment, the Budget Law 2025-2029 introduced that dividends and profits paid (or credited) by Uruguayan entities -mandatorily subject to CIT due to their legal type- will be subject to IRNR withholding at a 7% rate, provided:

• The dividends/profits are taxed in the beneficiary’s country of residence, and
• The referred jurisdiction grants a tax credit for the tax paid in Uruguay.

If the beneficiary cannot use the tax credit due to a tax loss position, then dividends/profits will be exempt from IRNR in Uruguay.

Under certain circumstances, non-distributed earnings will also be subject to 7% withholding after three years of being generated.

Dividends or profits paid or credited by CIT payers to resident shareholders are not subject to IRPF when they derive from non-taxable income for CIT purposes (i.e. foreign-source income), except for dividends or profits paid out of foreign-source income derived from holding movable capital. In this last case, a 12% withholding IRPF rate is applicable.

Interest income

Loan interests are exempt from IRNR if at least 90% of the CIT payer (debtor) assets generate non-taxable income for CIT purposes. Therefore, interests paid or credited by local entities whose assets are located abroad and exceed 90% of their total assets are free of withholding tax (WHT).