Uruguay is fast becoming one of the most desirable countries to live and invest in. With its strong economy and high quality of life, Uruguay offers many advantages to those looking to immigrate and invest in the country. In this blog, we’ll go over the various benefits of living and investing in Uruguay and explain why so many people choose the country as their new home.
From the low cost of living and favorable tax system to the excellent healthcare and education system, Uruguay is an ideal destination for anyone looking to live a great life. We take a look at the country’s real estate market, lifestyle benefits and much more. So, if you want to learn more about this unique country, read on to learn about the many benefits of living and investing in Uruguay.
Living in Uruguay
Uruguay is a safe and stable country with a lower cost of living and a high quality of life. From cosmopolitan cities like Montevideo to beach towns like La Paloma and Punta del Este, there are ample opportunities for those looking to spend some time living in Uruguay. Plus, it’s relatively easy to obtain residency as long as you have a valid passport, certain proof of income like a pension, dividends, rental income, or a work contract with a company in Uruguay and pass a medical check-up here in Uruguay. You also need to present a police clearance from back home. Once you’re a legal resident, you can enjoy benefits such as access to public healthcare and discounts on some local services.
Speaking of residence and all its legal aspects: It’s worth noting that tax residence and legal residence are different concepts. What do they mean in each case? What steps should be taken? Here are some important considerations to keep in mind:
- Legal residence is a requirement to live permanently or longer than allowed for tourists in Uruguay, to obtain an identity card and to work. It’s important to mention that legal residence isn’t required to invest in the country.
- As for tax residency, be warned: the regulations provide that a person is considered tax resident in Uruguay if one of the following conditions is met:
- A person must reside in Uruguay for at least 183 consecutive calendar days to be considered a resident of the country.
- Economic activities and important partnerships are concentrated within the country’s borders.
- Obtaining legal residence in Uruguay depends on the nationality of the foreigner and the duration of his or her stay in the country:
- Those wishing to work in Uruguay for less than 180 days must apply for a temporary identity card.
- Foreigners who wish to stay in Uruguay for less than 2 years should apply for a temporary residence permit, which can be extended for another 2 years.
- A permanent residence permit is applied for foreigners who want to live permanently in Uruguay or whose temporary residence permit has expired.
- Persons who wish to become tax residents of Uruguay must, above all, comply with the following regulations:
- Property for an amount in excess of 3,500,000 Indexed Units, equivalent to approximately US$440,000, if acquired on or after July 1, 2020. In addition, a physical presence in Uruguay of at least 60 days (within one calendar year) is required.
- A direct or indirect investment in a business with a value in excess of 15,000,000 indexed units (approximately US$1,900,000), provided that it was made after July 1, 2020, and created at least 15 new full-time salaried jobs as of that date and during the calendar year.
Recently, a law was ratified that improves the current system of investment promotion by extending the so-called “window period” from five to ten years – a period during which passive income from foreign investments is exempt from tax. In addition, individuals can now pay an income tax of seven percent on this income without it becoming time-barred.
Investing in Uruguay
Uruguay has a thriving business environment with lots of opportunities for investors and retirees. From small business start-ups to larger enterprises, there are plenty of options for those looking to make their mark in this small but powerful country. There are also plenty of tax benefits for foreign investors, including incentives for importing goods and services into the country. Plus, it’s easy to become a fiscal resident. Team Haverkate can provide contacts for good local accountants who can help to set this up.
Moreover, in 2019, Uruguay has achieved the remarkable feat of recording 17 years of uninterrupted economic growth and prosperity – the longest period and highest growth rate in the country’s history. The annual average rate for the period 2003-2019 was estimated at 9%, above the Latin American average.
Economic growth was driven by rising private spending and investment, as well as an upswing in exports of goods and services. Although the growth rate has slowed in recent years due to an unfavorable external economy and the Covid 19 pandemic, unlike other Latin American countries, there has been no period of economic downturn.
Unlock Your Dream Life in Uruguay!
Team Haverkate is your go-to for tapping into the unique potential of Uruguay. We have the expertise to locate and secure property that suits your individual needs, immersing you in an experience like no other. Discover why Uruguay has been referred to as a paradise and begin your journey today with Team Haverkate!