Since 1 January 2026, Uruguay has had new rules for taxing investment income from foreign sources. The law behind them has been known for months. How the tax is actually collected, however, the tax authority DGI only settled in the course of the year, most recently with a resolution of 8 October. For many people who have moved to Uruguay, this is now becoming real: the first advance payment for the first half of the year is due on 26 October 2026, and anyone who holds a portfolio with a bank in Montevideo has seen a monthly tax deduction on their account since the summer.
The foundations are in Ley 20.446, the budget law of 16 December 2025, and in Decreto 95/026 of 6 May 2026, which inserted the rules into the implementing regulations of the income tax, Decreto 148/007. The DGI set the deadlines and procedures in three resolutions: 1517/026 of 29 June, 1783/026 of 5 August and 2294/026 of 8 October. What the law itself changed, and who Uruguay still makes sense for afterwards, we have already explained in our article on the 2026 tax reform. Now it is about practice: who withholds, who pays themselves, when and how much.
What is taxed in the first place
Uruguay's income tax for individuals is called IRPF. Under Art. 6 No. 2 of Title 7, as amended by Ley 20.446, it covers two groups of foreign income for taxpayers in Uruguay:
Under Art. 37 of Title 7, the tax rate on this income is 12%. For people who chose the reduced variant under the old arrival rule of Art. 24 lit. b, the rate is 7%.
The starting point matters: the tax only applies to people who are tax resident in Uruguay and do not use one of the arrival options that take foreign income out of the IRPF for a number of years. These options, often simply called the tax holiday, still exist, but since 2026 they come with new conditions. If you use one, the deductions do not apply to you, but you have to prove that to your bank yourself.
Route 1: your bank in Uruguay withholds the tax
If you hold your securities portfolio through a bank, broker or wealth manager in Uruguay, the tax is usually deducted directly. In Art. 44 quinquies, Decreto 148/007 names as withholding agents the entities resident in Uruguay that broker transactions in foreign securities for the client and hold them in custody. Following an addition by Decreto 237/026 of 1 October 2026, this also applies where the actual custody sits with a bank abroad, but the Uruguayan entity acts on the client's behalf and holds the contract with the foreign custodian.
How the deduction is calculated is set out in Art. 44 sexies:
There was a transitional rule for 2026. Under Art. 44 nonies, payment to the DGI only began with July, and under Nos. 23 to 25 of Resolution 1517 the banks have until October 2026 to pay over the deductions calculated up to September. So if you have seen a new line item on your statements since July, this catch-up is exactly what you are looking at.
Capital gains have one special feature. For securities that were already in the portfolio before 2026, nobody has to dig out the original purchase costs from decades ago. Under No. 11 of Resolution 1517, provided the conditions of Art. 29 ter are met, the market value on 31 December 2025 counts as the base value for such legacy holdings. Under No. 12, the DGI accepts price data from the Bloomberg platform as the source for these values. Under No. 14, losses on disposals may be set off against other foreign investment income.
Making the deduction final
The monthly deduction is initially an advance payment on the annual tax. Under Art. 44 sexies and No. 18 of Resolution 1517, however, you can elect for the deductions to be final. To do this, you must tell your bank by 31 January of the following year, and the bank reports it to the DGI in April. The election stays in force until you revoke it. Whether it pays off depends on what your annual return would otherwise show, and that is exactly what you should work through with your tax adviser in Uruguay before the end of January.
Route 2: you make the advance payments yourself
Many people who move keep their portfolio with a bank in their home country, at least for the first few years. These banks are not withholding agents under Uruguayan law, because Art. 44 quinquies only names entities based in Uruguay. For you, that means: nobody withholds on your behalf, you have to make the advance payments yourself.
This is governed by Art. 44 terdecies of Decreto 148/007. Anyone who receives investment income or capital gains from abroad on which nothing has been withheld makes half-yearly advance payments. The calculation is again cumulative: 12% on the income accrued since the start of the year, less the payment for the first half. For income from immovable property abroad, meaning rent, Art. 44 duodecies has its own rule: 12% on the receipts of the half-year.
You can also elect for these advance payments to be final. In that case the obligation to file an annual return for exactly this income falls away.
A portfolio held at home also raises the question of what your home country keeps taxing on the same returns, and whether a tax treaty prevents double taxation. That depends on where you come from:
The deadlines
This is where most has moved in recent weeks. Resolution 1517 originally set other dates. With Resolution 2294 of 8 October 2026, the DGI rewrote Nos. 21 and 22. From next year, the rule is:
The exact day is set each time by the DGI's due-date calendar. For the introductory year there is a transitional rule: under No. 26 of Resolution 1517, the advance payments for the first half of 2026 are due in October 2026. For foreign investment income from securities, Resolution 1783 expressly set the date at 26 October 2026. The payment for the second half of 2026 then follows under the new rule in February 2027.
If you have not yet made this payment: speak to your tax adviser or contador today. The date is in the resolution, and the calculation is cumulative, so it is not difficult once you have the income figures for the first half of the year.
Route 3: the fixed annual amount
Since May, investors with large portfolios have had a third option. Art. 44 quaterdecies of Decreto 148/007 introduces a simplified regime: instead of accounting for every dividend and every price gain, you pay a fixed amount of 1,875,000 Unidades Indexadas (UI) a year for all foreign investment income and capital gains. The election is made once and applies for up to 20 consecutive years. Under No. 20 of Resolution 1517, it is exercised with the tax return for the first year of the option, and after that a return has to be filed for every year of the term.
What that means in money depends on the value of the UI, an inflation-indexed unit of account published daily by the statistics office INE. According to the INE table for October 2026, the UI stands at 6.6838 pesos on 31 October 2026. That puts the flat amount at around 12.5 million pesos. At the central bank's closing rates of 23 October of 40.078 pesos to the US dollar and 44.8633 pesos to the euro, that is about USD 313,000 or EUR 279,000 a year.
A simple calculation shows who this is interesting for. At a 12% tax rate, this sum corresponds to annual taxable foreign income of just over 104 million pesos, or around USD 2.6 million. Only if you regularly earn more foreign income and gains than that does the flat amount come out cheaper. For most people with an ordinary retirement portfolio it is not an option; for entrepreneurs after selling a company it can be.
If you choose the flat amount and pay it in full in January, then under No. 20 of Resolution 1517, as amended by Resolution 2294, you make no half-yearly advance payments that year. If you show your bank proof of payment, it makes no deductions, once it has checked the validity of the option on the DGI website. The UI value of 31 December of the previous year then applies.
For 2026 there was a special rule under No. 7 of Resolution 2294: anyone who paid the flat amount in full by 19 October 2026, calculated at the UI value of 31 October, did not have to make any advance payments for 2026, and the bank did not have to pay over the deductions calculated up to September to the DGI or make new ones for October to December. That deadline has passed. For 2027 the window opens in January.
Who is not affected, and what they have to do
Two groups fall outside the deduction: people who are not tax resident in Uruguay, and new arrivals who use one of the tax holiday options (in Uruguay this is the impatriados regime). Under Art. 44 sexies, both must give their bank a sworn declaration, addressed to the DGI, that evidences their status. The bank keeps it until the limitation period expires. For impatriados, under No. 19 of Resolution 1517, the bank must also check on the DGI website before every credit whether the option is valid.
If you do not submit this declaration, the deduction is made even though you do not actually owe it, and you then have to reclaim the money through your tax return. Anyone who moved to Uruguay during 2026 in particular should therefore check that their bank has recorded the correct status. How tax residence in Uruguay arises in the first place, and what the residence requirements are, is covered in our guide to moving to Uruguay.
Distributions from old profits and your own companies
If you invest through your own company abroad, such as a holding company, you will meet a further rule. Under Art. 20 quater of Decreto 148/007 and No. 4 of Resolution 1517, dividends from a foreign company are allocated in a fixed order: first to the income already attributed to the shareholder up to 31 December 2025 under the rules then in force, then to certain Uruguayan income of the company up to that date, then to the remaining old profits up to the end of 2025, and only after that to profits from 2026 onwards. For certain foreign companies there is also an attribution regime under which their income is taxed directly in the hands of the shareholder. If you have a structure like this, you need a calculation of your own for 2026; there is no one-size-fits-all answer here.
What this means for your day-to-day
All in all, the new system asks one thing of you above all: an orderly portfolio and clear responsibilities. Three cases can be distinguished.
You live in Uruguay and hold your portfolio with a bank in the country: the bank deducts 8% every month and credits withholding tax paid abroad if the paperwork is in order. Your job is to decide by the end of January whether the deductions should be final, and to supply complete evidence of foreign withholding tax.
You live in Uruguay and still hold your portfolio with a bank in your home country: then you make the advance payments yourself, for 2026 for the first time in October, from 2027 in August and February. Get your bank's income statements for each half-year, and put the payments in your calendar.
You are new to the country and use the tax holiday: then you must have exercised the option with the DGI and given the declaration to every bank in Uruguay, otherwise tax is withheld anyway. Which tax holidays exist since 2026, and on what conditions, is shown in our overview of tax holidays in Uruguay, Chile and Ecuador. An honest assessment of what the country costs and offers beyond tax is in our Uruguay reality check, and the key facts are on our Uruguay country page.
One thing applies in all three cases: the DGI has amended its resolutions several times this year, most recently on 8 October. If you built your planning on the position as of early summer, compare it with the current versions. IMPO, Uruguay's official gazette, publishes each text in the version in force, with all amendments.