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Uruguay and its software tax regime: Benefits for technology companies
By Ricardo Pittaluga, Pittaluga Abogados
Uruguay has a special tax regime designed to encourage the development and export of software and technology services. Under this regime, eligible companies can obtain partial or full exemptions from the Income Tax on Economic Activities (IRAE) and, in certain cases, exemption from Value-Added Tax (VAT).
The main objective of the regime is to attract and support real, active technology companies operating in Uruguay, in alignment with the international fiscal-transparency standards established by the Organisation for Economic Co‑operation and Development (OECD).
In order to benefit from these incentives, the software must be duly registered in Uruguay with the Dirección Nacional de la Propiedad Industrial (DNPI), and the owner company must submit an annual sworn statement to the Dirección General Impositiva (DGI).
In summary, companies that develop software fully or partially in Uruguay may significantly reduce their IRAE tax burden in proportion to the local development carried out, thereby preserving efficient profitability while complying with the economic substance requirements demanded by international regulations.
Pittaluga Abogados
Pittaluga Abogados, has initiated its professional practice 20 years ago, as an Intellectual Property Law Firm.
After some years providing a specialized and top level service for foreign clients, many of them among the world premier companies, Pittaluga Abogados obtained a recognized international prestige in said field, which convert it into one of the leaders Intellectual Property Law Firms in Uruguay.
Thus, today in P&A we take pride in emphasizing that our goal has always been and will continue being, to keep a personal relationship with our clients, considering at all times the priorities of our clients as our own, with the belief that each one of them is unique and irreplaceable.
