For people struggling with Argentinean's visas I wonder if any of you considered getting a DN visa in Uruguay. You'd have huge benefits like being able to get a local US$ bank account and don't dealing with exchange issues and a marvelous 11 years tax exemption.
By becoming a tax resident in Uruguay, you can take advantage of special tax benefits, the most significant being a ten-year tax exemption on your foreign income.
Individuals who have recently obtained tax residency are subject to non-resident taxation rules. This means that the tax exemption period begins in the fiscal year following residency, effectively making it eleven years.
During this time, you are not required to pay taxes on any income earned outside of Uruguay, including interest and dividends from non-resident entities (companies located outside of Uruguay).
Once the tax exemption period ends, foreign-source interest and dividends are taxed at a rate of 12%. However, income from owning or renting property abroad is not subject to taxation.
If you already pay income tax on interest or dividends generated overseas, Uruguay will not impose additional taxes. Additionally, if you are already paying a rate of 12% or higher in another country, you will not have to pay taxes in Uruguay. This is known as the non-double taxation rule, allowing individuals to settle in other locations without facing double taxation. This is particularly beneficial for nomads who desire the freedom to travel and live in different places.
However, income received from investments abroad, known as movable assets, may still be subject to taxation. This includes dividends and interest from securities, loans, and bank deposits paid to you by foreign individuals or firms.
Fortunately, taxpayers have the option to elect a 7% tax rate on income from movable assets abroad, instead of the standard 12%. This reduced rate does not have a time limit and can be maintained as long as you remain a fiscal resident.
Therefore, when becoming a new tax resident in Uruguay, you have two choices: either enjoy a ten-year tax exemption on foreign dividends and interest or pay a reduced tax rate of 7% on these types of income for as long as you maintain your tax residency, which could extend beyond the initial ten-year period.