The catch for Uruguay tax residents in Ley 20.446 includes a $2 million floor

What the residency tax rule means

Uruguay’s Ley 20.446 keeps the 11-year foreign-income tax holiday for new tax residents, but it now costs far more to qualify through property. The real estate route was raised to about $2 million or 12.5 million Unidades Indexadas and the old low-spend, 60-day option is gone.

The law took effect Jan. 1, 2026, after being promulgated Dec. 16, 2025. New tax residents who don’t qualify for the holiday now face 12% IRPF on expanded foreign-sourced income, including capital gains, rentals and income routed through non-resident entities.

Who feels the squeeze

Digital nomads and expats who wanted a light-presence path into Uruguay are the main losers. They now need to spend more than 183 days in the country each year or make a much larger commitment through property or the new fund route.

Tourists staying under 183 days are still non-residents, so this change doesn’t touch them. High-net-worth applicants can still use the real estate path without living full time in Uruguay, but the bar is much higher than before.

What to do next

Applicants should check whether they can meet the 183-day test, since it remains the simplest route and needs no investment. Those looking at the property or fund options should confirm the residency proof requirements with the tax authority before moving money.

The new Fondo Uruguay Innova route calls for $100,000 a year for 11 years, paid through securities issued for the fund, not a donation. Read our full Uruguay guide for the complete picture and see the latest visa updates.