Uruguay has long been known for one of the most attractive regimes in the world for people who move there: a multi-year exemption on most foreign-source income for new tax residents, often called the “tax holiday”. In 2026 the rules changed significantly. If you are thinking about buying property partly for tax reasons, this is what you need to know.
What changed on 1 January 2026
Uruguay’s national budget law for 2025–2029, Law 20.446, rewrote the conditions for new tax residents from 1 January 2026. People who obtained tax residency and opted into the holiday before 31 December 2025 keep the previous terms.
- The holiday still lasts 11 years: the year you become tax resident plus the following ten.
- The real estate route is far more expensive: property worth more than 12.5 million Unidades Indexadas — roughly US$2 million — compared with roughly US$550,000–600,000 before.
- A new fund route: an annual contribution of US$100,000 to a national innovation fund for each year of the benefit.
- The low-presence 60-day option is gone as a route to the holiday.
- Foreign capital income outside the holiday is taxed at 12%, with a reduced rate for a transition period after the holiday ends.
Three ways to qualify
Under the new framework, a new tax resident generally qualifies for the holiday through one of three paths:
- Physical presence: spending more than 183 days a year in Uruguay. No investment is required.
- Real estate: owning urban property above the ~US$2 million threshold for the duration of the benefit.
- Fund contribution: the US$100,000-per-year route.
In practice, the 183-day route is the natural fit for families who are genuinely moving. The real estate route suits wealthy buyers who want the benefit without living in Uruguay most of the year — and who were going to buy a high-end property anyway.
Legal residency is a separate question
Tax residency and legal residency are not the same thing. Legal residency in Uruguay does not require a minimum investment: it is based on your intention to live in the country and your ability to support yourself. The investment thresholds above relate to tax residency and the holiday, not to your right to live there.
What this means if you are buying
- If you are relocating, the property you buy does not need to meet the ~US$2 million threshold for you to benefit — presence can do the work.
- If you are buying above US$2 million in José Ignacio, Punta del Este or Carrasco, the purchase itself may open the door to the holiday. Structure and timing matter.
- Do not assume an older guide is still valid. Much of what is published online still quotes the pre-2026 figures.
We help you understand which route fits your plans before you choose a property, and work alongside qualified Uruguayan tax advisers on the details.
This article is general information, not legal or tax advice. Rules and thresholds change; confirm how they apply to you with a qualified Uruguayan tax adviser before making decisions.
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