Uruguay introduces new incentives to attract skilled talent and boost competitiveness

Uruguay is expanding its efforts to attract highly skilled professionals with a new incentive framework designed to encourage both Uruguayan and international talent to relocate to the country.

In late October, the government approved Decree No. 257/026, implementing the Skilled Talent Attraction Program established under the latest National Budget Law. The program targets professionals relocating to Uruguay to take up salaried positions at companies operating in science and technology, innovation, technology development, or global services.

A new framework to attract skilled professionals
Under the new regulations, eligible professionals can choose to pay Nonresident Income Tax (IRNR) at a flat rate of 12%, rather than Personal Income Tax (IRPF). Those who elect this option may also choose to opt out of Uruguay's social security system and the associated contributions.

These benefits apply for the calendar year in which the option is exercised and the following four years.

To qualify, professionals must not have been tax residents of Uruguay during the five years preceding their relocation. They must also be physically present in the country for at least two-thirds of each calendar year and earn all their employment income in Uruguay, exclusively through salaried employment.

Participating companies must operate in one of the business activities covered by the decree and be registered with Uruguay's tax authority (DGI) and Social Security Bank (BPS). Employers are also responsible for meeting documentation, reporting, and compliance requirements, as well as withholding and remitting the applicable income tax.

Uruguay XXI helps companies attract and develop talent
The new framework complements Uruguay XXI's ongoing efforts to promote the country as a destination to live, work, and invest, while helping businesses access the skilled workforce they need to establish, expand, and grow their operations.

Through its Talent team, Uruguay XXI provides resources and programs that support companies at different stages, from relocating international professionals to developing specialized workforce skills.

One of these tools is Fast Track, a service that streamlines visa and temporary residency procedures for foreign professionals hired by exporting companies, in coordination with Uruguay's National Directorate of Migration.

Live in Uruguay offers a centralized source of practical information for professionals considering a move to the country, including guidance on immigration procedures, employment opportunities, education, and other aspects of settling in Uruguay.

Another initiative, Finishing Schools, is a program developed in partnership with Uruguay's National Institute of Employment and Vocational Training (INEFOP). It provides non-repayable funding covering up to 70% of the cost of training programs tailored to the needs of companies that export services. The initiative supports the development of technical and professional skills while helping companies create new jobs.

Together, tax incentives, streamlined immigration procedures, and workforce training programs expand the resources available to companies choosing Uruguay as a base for their international operations.