Expatriate tax - Argentina

• Expatriates who require a work visa must apply for this before taking up employment in Argentina. It is therefore important that the expatriate’s employment contract and benefit package is structured in a tax efficient way before the expatriate comes to Argentina, to get certain tax benefits.

• Any person who enters the country for purposes other than tourism or recreation requires the corresponding visa
  • On the other hand, the Argentine company must request the corresponding registration with the RENURE (Unique National Registry of Foreign Requirements).
  • There are 3 types of residence:
    • Transitory residences: work permits, among others
    • Temporary residences: residences for work, for transfer of personnel between companies, MERCOSUR Agreement and associates, among others
    • Permanent residences: ie. family reunification, due to roots in the country, among others
  • The different types of visas generally applicable to those who come to work in the country for a certain period are:
    • Transitory residences: Provisions 1170/2010 and 1824/2013 Paid or unpaid tasks, Provision 758/2022 (Law 25,871 Art. 24 Inc. h). This special temporary residence is recommended for those foreigners who enter the country to carry out paid or unpaid tasks, in the scientific, professional, technical, religious or artistic fields.
      
      Temporary residences
      
      
    • Filing MERCOSUR – Nationality Law (Art. 23 Inc. l)
      Applicable to native citizens of Bolivia, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay, Venezuela, Guyana and Suriname
    • Temporary filing by employment contract. Art. 23 Inc. a)
      Applicable to those who enter the country to engage in some legal, paid activity, with permission to work in a dependency relationship.
    • Transfer Personnel. Art. 23 Inc. e)
      Applicable to those who are engaged in scientific, technical, or consulting activities, hired by public or private entities for work in their specialty. Directors, technicians and administrative personnel of public or private entities of a commercial or industrial nature, transferred from abroad to cover specific positions in their companies and that accrue fees or salaries in the Argentine Republic
    • Digital nomad:
      It is for 6 months and can be extended once for the same period of time. This is a specific visa for people who, in addition to providing services to natural or legal persons domiciled abroad, are foreign nationals of countries that do not require a tourist visa to enter Argentina.
  • The person may be in a dependent relationship with the Argentine company or maintain a dependent relationship with the company of origin.
  • Although there is the possibility of requesting permanent residence for immigration purposes under certain assumptions, this will result in treatment as a resident for income tax purposes and the non-possibility of applying Art. 4 Law 24,241.

Tax year runs from 1 January to 31 December.

Individuals are taxed at progressive rates according to total taxable income. Annual Rates for 2023 applicable to September accrual compensation are: 

Accumulative Rates corresponding to compensation accrual from October 2023 to December 2023, paid till December 2023.

(*) Current Exchange rate is 1USD= $ Ars 365,5.

Subject to any double taxation agreements, Argentinian tax is imposed on assessable income. A resident of Argentina is taxed on worldwide sourced income for the period of residency, whilst non-residents are taxed on Argentinian sourced income only.

Foreign nationals who have obtained the permanent residence for immigration purposes in Argentina as well as those who have stayed in Argentina, with the relevant authorisation, for a period of twelve months are considered Argentine residents.

Temporary absences from the country, insofar as they do not exceed 90 days (consecutive or not) within such 12-month period, shall not be considered to interrupt the continuity of the foreign national’s permanence in Argentina.

Argentine residents must pay tax on their income and assets in Argentina and abroad.

The definition of assessable income for employment purposes includes wages, salaries, bonuses, gratuities, and allowances if these are received as a reward for services. Income tax is withheld by the employer responsible for paying salaries or compensation.

Personal exemptions for dependents and certain non-taxable minimums as set forth in the Income Tax Law may be deducted from the taxable basis.

Any payments in kind and additional benefits granted to employees must be included in the employee’s taxable income for purposes of Income Tax withholdings.

Non Residents with permanent presence in Argentina (NRPP) foreign individuals that come to Argentina for labour reasons, with a temporary visa for a period not exceeding five years will be only taxed on the Argentinean source income on such period.

Argentine sourced income is the one derived from the work performed in Argentina no matter the place in which it is paid (in Argentina or abroad).
In addition, the NRPP will be taxed only on assets located in Argentina as of 31 December of each year.

Argentina tax (given that they are subject to income tax on worldwide sourced income) are given credit for foreign tax paid on foreign-source income subject to some requirements.

The following expenses -among other- shall be tax-deductible for Income Tax purposes:

• Payments made to the pension system and to privately and/or union's health insurance schemes.
• Payments to the self-employed pension scheme, insofar as they have been duly made.
• Life insurance premiums paid (deduction subject to a maximum cap)
• Funeral expenses (deduction subject to a maximum cap)
• Contributions paid to private retirement plans (deduction subject to a maximum cap)
• Voluntary contributions to Pension Fund Managers (deduction subject to a maximum cap)
• Medical fees. It must be noted that the deduction applies to only 40% of such fees up to a maximum of 5% of the employee’s net income levied with tax.
• Rent paid (deduction subject to a maximum cap) only if the person has no other property).
• Payment to domestic employees (deduction subject to a maximum cap).

On 6 October 2023, Law 27,725 was published in the official gazette, through which the fourth category of income tax was eliminated as of the 2024 fiscal period. It will be replaced by a new tax called "tax on the highest income from employment relationship.

Taxpayers who receive a monthly income greater than the equivalent of 15 times the minimum living and mobile wage (MLMW) will be subject to the new schedular tax system - that is, separate from the determination of the current progressive scale-.

On the highest income calculated on an annual basis, a non-taxable annual minimum equivalent to 180 MLMW will apply, and no other item may be deducted.

Above the highest income, after deducting the non-taxable minimum, a progressive rate will apply that will range from 27% to 35%; this scale will be updated twice a year, in January and July.

Withholdings from employment income are covered under the Pay-As-You-Earn (PAYE) system. If an individual is taxable with respect to employment income, the employer has a PAYE withholding requirement. Foreigners who are present in Argentina for less than six months are also subject to withholding. However, each case should be evaluated to determine the applicable withholding regime.

The Personal Asset Tax is levied on movable property and real estate situated both in Argentina and abroad as of December 31^st of each year.

Individuals considered tax residents for income tax purposes are subject to Personal Asset Tax on worldwide assets.

Expatriates considered 'Nonresidents with permanent residence' (NRPP) for income tax purposes are liable for this tax only on assets located in Argentina.

Individuals are liable for the Personal Asset Tax when they own assets for over $6,000,000. The tax rate is progressive. It ranges from 0.5% to 1.75% of the assets located in the country. A different rate is applicable over assets located outside Argentina according to the following scale:

Rates over assets located in Argentina

Rates over assets located outside Argentina

For properties destined to the home of the taxpayer, they will not be subject to tax when the value, in accordance with this law, is equal to or less than AR$ $ 56.410.705,41. 
The individuals considered to be taxpayers for Personal Assets Tax purposes are subject to a scheme consisting in five bi-monthly advance payments on account of their next tax return.

The abovementioned amounts and scales will be updated for inflation at the end of the year.

Individuals working in a labor relationship must contribute to the Pension System.

(1) To be withheld by employer. There is a monthly earning cap for employee contributions.
(2) 26.4 % or 24% depends on the activity and the revenue of the company.

Reductions have been established for the employer's contributions, depending on certain attributes of the workers or whether the work force is being incremented.

There are some social security exemptions that should be evaluated on each case (ie: the one provided in Social Security treaties with other countries or Art. 4 Law 24.241).

Stock options are deemed to be compensation in kind and the individuals who receive them are levied with tax Each case should be evaluated to determine the moment in which the income is considered taxable and the corresponding income tax and social security treatment.