What Are Entities’ Corporate Compliance Requirements in Uruguay?

Between 2003 and 2019, Uruguay underwent its longest-ever period of economic expansion. The foundation of Uruguay’s economy lies within its agricultural sector. This sector plays a pivotal role in the country’s export industry.

Notably, Uruguay exports a diverse range of products, including meat, cellulose, grains, dairy products, wood, pharmaceuticals, and various services. Agricultural-based products account for over 60 percent of Uruguay’s total exports. Additionally, food processing and refining agricultural products make up over 60% of Uruguay’s total exports. These industries have corporate compliance requirements in Uruguay which we must take into account.

Uruguay distinguishes itself in the Latin American region by being a society that upholds equality and boasts a commendable per capita income. There are minimal levels of inequality and poverty and an almost total eradication of extreme destitution. In proportional measures, its middle class stands as the most extensive across the Americas. This encompasses over 60% of the nation’s population.

The country’s significant economic strides provide vital support for the pursuit of poverty alleviation and the fostering of shared prosperity. The nation has displayed a firm dedication to social protection matters. In Uruguay, there has been a long-standing focus on inclusive social policies that aim to expand program coverage to encompass the entire population. Now, let’s delve into entity corporate compliance requirements in Uruguay.

Uruguay is a very politically stable country with high legal security. It has a non-discriminatory investment policy with no restrictions on the participation of foreign capital. However, as you establish your business, you must be aware of corporate compliance requirements in Uruguay.

We recognize the challenges that come with adapting to new legislation, especially when it comes to complying with corporate obligations. To simplify this process, Biz Latin Hub has designed this Annual Fiscal Compliance Calendar.
Corporate Compliance Requirements in Uruguay – We recognize the challenges that come with adapting to new legislation, especially when it comes to complying with corporate obligations. To simplify this process, Biz Latin Hub has designed this Annual Fiscal Compliance Calendar.

A company must fulfill the essential corporate compliance requirements in Uruguay to operate freely within the nation once it has been properly established in Uruguay. Upon seeking the assistance of a local specialist, these legal responsibilities are not very arduous or intricate.

Uruguay presents various legal frameworks for enterprises to establish their operations, ranging from not-for-profit entities to publicly traded corporations. A foreign enterprise has the option to establish a legal entity using one of the subsequent structures:

  • Corporation (Sociedad Anónima- S.A.)
  • Streamlined Share Companies (Sociedad por Acciones Simplificadas- S.A.S.)
  • Limited Liability Company (Sociedad de Responsabilidad Limitada- S.R.L.)
  • Foreign Company’s Branch Office (Sucursal)

Every established company in Uruguay is obligated to designate a legal representative. This representative assumes the responsibility of representing the organization before external parties. It is important to note that businesses aiming to expand within the country must appoint a legal representative during the company incorporation process. This is crucial to ensure one abides to corporate compliance requirements in Uruguay.

The legal representative bears various responsibilities, including:

  • Acting as the authorized legal representative of the company and conveying its intentions.
  • Handling formalities with public and/or private entities.
  • Representing the company in legal proceedings, if necessary, in collaboration with an attorney.
  • Assuming the responsibility for tax and social security compliance on behalf of the company.
  • Informing the Central Bank of Uruguay (BCU) about the composition of the company’s Board of Directors.

Fiscal Address obligation

In addition, foreign executives seeking to expand their operations in Uruguay must register a fiscal address to facilitate the successful incorporation of a local legal entity. This fiscal address serves as the official registered address of the company and is used for all official communications and correspondence. It is worth noting that the fiscal address must be explicitly stated in the company bylaws in order to be legally registered during the company incorporation process. This will help ensure one is abiding by corporate compliance requirements in Uruguay.

Labor and social security compliance

Executives overseeing companies operating in Uruguay must ensure their familiarity with the various legal obligations regarding employee payments. These obligations encompass salaries, social security contributions, payroll taxes, and severance payments to employees.

Moreover, business owners are responsible for providing workers’ compensation insurance and a bonus known as the “thirteenth salary,” which is typically paid every six months or at the end of June and December. The bonus amounts to one month’s salary, divided into two payments. Additionally, employees are entitled to 20 days of paid vacation.

Workers with more than five years of service in the same company, even if the company has changed its owner one or more times, shall also be entitled to one additional day of leave for every four years of seniority.

The obligatory social benefits for employees in Uruguay include:

  1. Health contributions
  2. Retirement contributions
  3. Occupational risk contributions

Accounting and taxation compliance

When establishing a company in Uruguay, it is crucial to take into account the local accounting and tax system in order to obey by corporate compliance requirements in Uruguay.

To adhere to the accounting and taxation requirements for corporations in Uruguay, the following measures must be taken:

  • File monthly and annual tax returns.
  • Make monthly tax payments.
  • Submit tax statements at the end of the fiscal period.
  • Renew certificates and policies within one year of the due date.
  • Prepare financial statements within four months from the closing date of the fiscal period.
  • Provide balance sheets to the bank at the conclusion of the fiscal period.
In order to simplify processes, Biz Latin Hub has designed this Annual Legal Calendar with fundamental responsibilities that every company in Uruguay must attend to.
Corporate Compliance Requirements in Uruguay – In order to simplify processes, Biz Latin Hub has designed this Annual Legal Calendar with fundamental responsibilities that every company in Uruguay must attend to.

Financial Statements

The preparation and presentation of financial statements must adhere to the prescribed accounting standards. These statements are to be reviewed and approved by the partners or shareholders within 180 days after the fiscal year concludes, during an ordinary general meeting.

Anual General Meeting

Part of the annual compliance entails holding a regular shareholders’ meeting, during which the endorsement and approval of the balance sheet is a crucial agenda item.

UBO Report

Corporations holding bearer or nominative shares are obligated to notify the Central Bank of Uruguay (“CBU”) regarding any changes pertaining to their shareholders and the ultimate beneficiaries.

Furthermore, these companies must also disclose information about their ultimate beneficiaries. As per our legislation, a beneficial owner refers to an individual (natural person) who directly or indirectly holds a minimum of 15% (fifteen percent) of the total capital or equivalent assets, or possesses a comparable percentage of voting rights. Additionally, this includes individuals who exert ultimate control over an entity, whether it’s a legal person, a trust, an investment fund, or any other legal entity or structure, regardless of having legal personality.

An infographic about Corporate Compliance Requirements in Uruguay created by Biz Latin Hub.
Accounting and taxation are included in Corporate Compliance Requirements in Uruguay

Based on our extensive experience these are the common questions and doubts of our clients when looking to operate within the country

1. What are the common statutory appointments for a company in Uruguay?

The following are the most common statutory appointments for Uruguayan legal entities:

– An appointed Legal Representative who will be personally liable, both legally and financially for the good operation and standing of the company. This should be a local national or a foreigner with the right to live/work in the country.

2. Is a Registered Office Address needed for a legal entity in Uruguay?

Yes, a Registered Office Address or local Fiscal Address is required for all entities in Uruguay for the receipt of legal correspondence and Governmental visits.

3. How long do companies have to submit their Annual Income Tax declaration in Uruguay?

Companies in Uruguay have 3 months to submit their Annual Income Tax declaration by the deadline of March 31st.

4. When should a company hold a General Shareholders Meeting in Uruguay?

In the case of closed joint-stock companies in Uruguay, the Ordinary Shareholders Meeting must be held within 180 days following the closure of the fiscal year. For open joint-stock companies in Uruguay, the Ordinary Shareholders Meeting should take place within a period not exceeding 120 days from the end of the fiscal year.

5. What are the accounting and taxation compliance requirements in Uruguay?

The accounting and taxation compliance requirements in Uruguay are as follows:

– Submit monthly and annual tax returns
– Pay taxes every month
– Submit tax statements at the closure of the fiscal period
– Renew certificates and policies, 1 year from the due date
– Prepare financial statements, 4 months from the date of closure of the fiscal period
– Submit balance sheets with the bank at the closure of the fiscal period

Engage with our specialists to meet your corporate compliance requirements in Uruguay

Before expanding your operations to, it is vital to have a thorough understanding of your corporate compliance requirements in Uruguay. While opportunities to do business in Uruguay are numerous, so are the risks for those who do not comply with local law. Therefore, working with a trusted legal and accounting firm is the fittest option.

At Biz Latin Hub, our team of legal specialists provides comprehensive company formation advice and guidance to support your expansion. With our full suite of bilingual market entry and back-office services, we are your single point of contact in Uruguay and Latin America. Reach out to us now to make the most of our market-leading services, and get a customized quote from our team.

Infographic: Biz Latin Hub services
If you want to understand the corporate compliance requirements in Uruguay, do not hesitate to contact the Biz Latin Hub team

The information provided here within should not be construed as formal guidance or advice. Please consult a professional for your specific situation. Information provided is for informative purposes only and may not capture all pertinent laws, standards, and best practices. The regulatory landscape is continually evolving; information mentioned may be outdated and/or could undergo changes. The interpretations presented are not official. Some sections are based on the interpretations or views of relevant authorities, but we cannot ensure that these perspectives will be supported in all professional settings.
Legal Team Uruguay

Legal Team Uruguay

Legal Team Uruguay is the Biz Latin Hub leading experts on doing business in Uruguay The Team writes on the news, doing business, law, and changing regulations. The team are experts in corporate law, Administrative law, Employment law, Immigration law and legal advisory services. Read more about them here. You can contact Legal Team Uruguay via our "contact us page".

Receive the latest news and advice about expanding your business globally
Subscribe to our newsletter to receive the latest business news and advice about entity formation, legal entity compliance, accounting, back office and fiscal requirements. Receive the latest news and advice about expanding your business globally.

This field is for validation purposes and should be left unchanged.