Setting Up a Real Estate Company in Uruguay: Structure, Registrations and Taxes
The Uruguayan real estate market is one of the most dynamic and reliable in South America, with growing interest from regional and international investors. Setting up a real estate company in Uruguay — whether to broker sales and rentals, develop construction projects or manage a portfolio of properties — requires informed decisions about the company type, the required registrations and the applicable tax regime. In this guide we explain what you need to know to structure a real estate company in Uruguay correctly.
Real Estate Business Models in Uruguay
Before defining the legal structure, it is important to be clear about the type of real estate activity, since each model has its own requirements:
- Agency or broker: intermediation in the sale and rental of properties on behalf of third parties, in exchange for a commission.
- Developer: buying land or buildings to build, refurbish and sell units. It operates as a construction company selling its own assets.
- Property holding company: a company whose main assets are its own properties, rented to third parties. An investment model without intermediation.
- Property manager: managing properties on behalf of owners (collecting rents, maintenance, dealing with tenants). Can be combined with agency activity.
- Real estate investment vehicle: a collective vehicle pooling capital from several investors to acquire and manage properties, usually through a trust or a specific corporate structure.
Each model can use different company types and has different tax implications. Clarity about the business model is the starting point for choosing the right structure.
Which Company Type for a Real Estate Business in Uruguay?
The choice of company type for a real estate business in Uruguay depends on the business model, the number of partners and the expected scale:
- SA (corporation): the most common form for large developers, real estate investment vehicles and companies with several investors. It makes it easier to raise capital, transfer holdings and bring in strategic partners, and is the structure best known to banks, notaries and institutional counterparties for large projects.
- SRL (limited liability company): suitable for family agencies or those with few partners, property managers and small or medium holding companies. Lower running costs than the SA.
- SAS (simplified joint stock company): increasingly used in the sector for modern agencies, proptech platforms and digitally oriented ventures. Its flexible articles and lack of ICOSA make it attractive for innovative business models.
- Sole proprietorship: for individual brokers starting out. No asset separation and limited growth potential, but the simplest and cheapest option at the early stage.
SA vs. SRL for a Real Estate Company in Uruguay
Comparing an SA and an SRL for a real estate company in Uruguay is common among first-time founders. The decisive factors are:
SA — when it is the best option:
- Large-scale development with several investors or shareholders.
- Projects requiring significant bank financing, where an SA inspires more confidence in lenders.
- When strategic partners or outside investors are expected to join, since transferring shares is more flexible than transferring SRL quotas.
- Companies operating with real estate trusts or collective investment structures.
SRL — when it is the best option:
- An agency with two or three partners who know each other well and do not plan to open the capital in the short term.
- A rental property holding company with family or close partners.
- Property managers of moderate scale with little need for outside capital.
- When lower running costs matter for the business’s initial viability.
How to Set Up a Real Estate Company in Uruguay
The process to set up a real estate company in Uruguay follows the standard incorporation steps, with some sector-specific considerations:
- Defining the business model and company type: choosing the structure that best fits the venture.
- Drafting the articles: the corporate purpose should precisely include the activities: real estate brokerage, buying and selling property on its own account, renting, property management, development, etc. A broad purpose avoids operational limits.
- Incorporation before a notary (SA/SRL) or by private document (SAS) and registration with the DGR.
- Legal publications where required.
- Obtaining the RUT from DGI with the activity code for real estate services.
- Sector registrations (see next section).
- BPS registration as an employer if the company will hire staff.
- Enabling electronic invoicing with DGI to issue CFEs.
Registrations and Requirements for Real Estate Agencies in Uruguay
Real estate brokerage has specific requirements in Uruguay, especially in anti-money laundering matters. The key points are:
- Obliged entity for AML purposes: under Law No. 19,574, real estate agencies and other intermediaries in property transactions are obliged entities: they must register with the National Secretariat for Combating Money Laundering and Terrorist Financing (SENACLAFT), apply customer due diligence, keep records and report suspicious transactions.
- Professional standards: having a qualified broker responsible for transactions and joining the sector’s professional associations or chambers is common practice and strengthens credibility with clients and counterparties. Check the specific requirements that apply at the time of starting.
- Municipal permit: each departmental government may have its own requirements for authorising the premises where the agency operates.
- DGI registration: registration as a taxpayer with the real estate services activity code, electronic invoicing and compliance with the sector’s tax obligations.
The Best Legal Structure for a Real Estate Business in Uruguay
There is no single answer to the best legal structure for a real estate business in Uruguay, but some general principles help:
- For a small or medium brokerage agency: an SRL or SAS, with a qualified broker responsible for operations. Lower running costs and suitable for the typical volume of this model.
- For a developer: an SA, for its capacity to raise capital, bring in investors and inspire confidence in banks and notaries in large transactions — or a trust structure for specific projects.
- For a rental property holding company: an SRL, SAS or SA depending on the number of partners and the size of the portfolio. SAs suit passive investors whose shares must be easily transferable.
- For a real estate investment vehicle: an investment trust managed by a trust company, or an SA with different share classes for investors. Requires specialised structuring advice.
- For foreigners investing in property through a company: an SA, SAS or SRL depending on scale, paying special attention to the beneficial ownership declaration to the BCU and, if the asset is farmland, to the rural land ownership rules (which generally require the chain of ownership to end in individuals).
Tax Regime of a Real Estate Company in Uruguay
The taxation of a real estate company in Uruguay depends on the activity:
Brokerage agency:
- Pays IRAE at 25% on net commissions (income minus deductible expenses: salaries, office rent, advertising, etc.).
- Commissions for brokering sales and rentals are subject to VAT at 22%.
Developer:
- Pays IRAE on the profit from selling the units developed (sale price minus the cost of land, construction and related expenses).
- Promoted housing projects under Law No. 18,795 can access exemptions from IRAE, VAT and Wealth Tax on qualifying units, a very significant tax benefit.
- The Investment Law (COMAP) can offer additional IRAE exemptions for large projects.
Rental property holding company:
- Rental income received by a company is subject to IRAE.
- Leasing real estate is in general exempt from VAT.
- The company’s properties form part of its assets subject to Wealth Tax at 1.5%.
Sales of property by a company:
- The gain on the sale of property by a company is subject to IRAE at 25%.
- The Property Transfer Tax (ITP) applies to the transfer: generally 2% paid by the seller and 2% by the buyer, calculated on the property’s cadastral value.
- Companies that develop and sell properties may have additional VAT obligations on construction activity, with different treatments depending on the use of the units.
Real Estate Companies in Uruguay for Foreigners
Uruguay is an established real estate investment destination for foreigners, and structuring that investment through a Uruguayan company can offer asset, tax and succession advantages:
- No general nationality restrictions: a foreigner can own 100% of a Uruguayan real estate company. For farmland there are specific ownership rules for legal entities, which do not depend on nationality but on the ownership chain.
- Asset separation: the company separates the real estate assets from the investor’s personal assets.
- Succession planning: holding properties through a company can make it easier to pass them on by transferring shares or quotas, although the inheritance of shares in a Uruguayan company may still require a succession process in Uruguay; plan it with a notary.
- Taxation of dividends: dividends paid to non-resident shareholders are subject to IRNR at 7% to the extent they come from income taxed by IRAE, a competitive rate for repatriating rental income.
- Beneficial ownership declaration: all Uruguayan companies, including real estate companies, must declare their beneficial owners to the BCU, including foreign-owned ones.
Conclusion
There is no single legal structure for a real estate company in Uruguay that is best in every case. The right decision depends on the business model — brokerage, development, rental or collective investment — the number and profile of the partners and the volume and type of transactions.
What does not change is the need to structure correctly from the start: choosing the right company type, completing the sector registrations, planning the tax regime with an accountant and knowing your transparency obligations with the BCU, SENACLAFT and DGI. A properly incorporated and registered real estate company is the basis for operating credibly in a market where the trust of clients and counterparties is the most valuable asset.
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