Inside Uruguay's Updated Tax Residency Rules
Effective January 2026, Uruguay is raising the real estate investment requirement for its 11-year tax holiday from $590,000 to $2 million. The 60-day physical presence residency option will be eliminated, and non-qualifying residents will face a 12% tax on foreign-sourced income.
Inside Uruguay's Updated Tax Residency Rules
Uruguay has significantly raised the bar for those seeking tax residency benefits. Under the latest budget law, the country is shifting its focus toward high-net-worth individuals and long-term residents. The most notable change is the increase in the real estate investment threshold required to qualify for the 11-year tax holiday on foreign-sourced income. This requirement has jumped from approximately $590,000 to roughly $2 million.
The government has also eliminated the popular 60-day physical presence option for tax residency. To qualify now, you generally need to spend more than 183 days per year in the country. Those who do not meet the new criteria for the tax holiday but still trigger tax residency will face a 12% tax on foreign capital income, including dividends, interest, and rental income.
Who is affected
These changes primarily impact expats and remote workers looking to make Uruguay their primary tax home. If you are a digital nomad staying on a short-term permit for less than six months, you generally remain unaffected. Tourists and temporary travelers do not trigger tax residency and will continue to enjoy tax-free status on their foreign earnings.
What you need to do
If you are planning a move to Uruguay, you should evaluate your residency strategy based on these updated visa updates and financial requirements:
- Physical Presence: Ensure you track your days carefully if you intend to stay longer than 183 days, as this will trigger tax obligations.
- Investment Paths: To secure the tax holiday, you must either invest $2 million in real estate or contribute $100,000 to the Uruguay XXI government fund.
- Documentation: Prepare apostilled records and proof of income for the National Migration Directorate, though the standard immigration residency process remains largely unchanged.
- Grandfathering: If you qualified for tax residency before January 1, 2026, your status is protected under the previous, more lenient rules.
Read our full Uruguay guide for the complete picture.