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flag Argentina Argentina: Tax system

In this page: Corporate Taxes | Accounting Rules | Consumption Taxes | Individual Taxes | Double Taxation Treaties | Sources of Fiscal Information

 

Corporate Taxes

Tax Base For Resident and Foreign Companies
The permanent establishment has been defined according to OECD's model. A company is deemed resident if its centre of activity (i.e. the location of a company’s economic activity or management activity) is within the country.
The Argentinian legislator broadened its content to include also the performance of services by a non-resident provider, including services rendered by consultants, within the national territory, for a total length greater than six months within any 12-month period.
 

Tax Rate

Corporate tax rate
ARS 0 to ARS 5 million 25%
ARS 5 million to ARS 50 million ARS 1,250,000 + 30% on the amount that exceeds ARS 5 million
Above ARS 50 million ARS 14,750,000 + 35% on the amount that exceeds ARS 50 million
Withholding tax dividend distributions: 7%
branch profit remittances: 7%
 
Tax Rate For Foreign Companies
Residents and non-residents are subject to the same tax treatment. Non-resident companies are only taxed on their Argentina-sourced income.
Argentine-source income (e.g. royalties, interests) received by foreign entities is subject to withholding tax in full and final settlement at source.
Capital Gains Taxation
Most capital gains are included in taxable income and taxed at the normal corporate income tax rates. Gains derived from the transfer of shares, bonds, and other securities are subject to tax at regular CIT rates (25% to 35%). Gains derived by a non-resident from the sale of equities of an Argentine corporation or other participation in the capital of an Argentine entity that is not publicly traded are subject to an effective rate of 13.5% on gross proceeds or a 15% income tax on the net gain if the seller’s tax cost basis can be duly documented for Argentine tax purposes.
The sale of corporate bonds placed by public offer, government bonds and notes issued by financial trusts are generally exempt.
Main Allowable Deductions and Tax Credits
Expenses are deductible if incurred for obtaining and preserving taxable income, as well as for taxes paid, depreciation or amortisation, reserves, directors' fees, wages and donations of up to a maximum of 5% of net taxable profits. R&D expenditures (for the development of intangible assets) may be deducted when they are incurred or amortised over not more than five years, the same as for start-up expenses. Bad debts can be deducted only in specific cases (like bankruptcy or prescription) and if supporting documentation is provided. Representation expenses are deductible up to 1.5% of the amount of salaries accrued during the fiscal year.
Interests deduction is limited to the higher of 30% of EBITDA or ARS 1 million.
Net operating losses may be carried forward for five years, whereas loss carrybacks are not allowed. Foreign-source losses must be offset against income from similar sources. The amortisation of goodwill cannot be deducted for profits tax purposes.
All deductions are subject to review by the tax authorities.
Other Corporate Taxes
Sales taxes are levied at jurisdictional level, generally at a rate of 3% to 5% of gross revenue from the sale of goods and services. Higher rates may be imposed on certain services in some provinces. Industrial activities usually are exempt or subject to lower rates (between 0 and 2%). Jurisdictions also levy a real estate tax, with rates varying according to the location and the property’s fiscal value.

A financial transactions tax of 0.6% is levied on deposits and withdrawals in current accounts; as well as a 1.2% tax on any transactions made in a bank without using a bank account. 33% of the aforementioned taxes are creditable against profits tax and minimum notional income tax and/or respective tax advances.

Stamp duty of 1% is levied on the formal execution of public and private instruments including contracts, notarial deeds and promissory notes. Special rates of 0.5%, 1.2%, 3%, and 3.6% apply in certain cases.

An annual wealth tax is levied on the shares or holding in the capital of local companies owned by individuals or undivided estates domiciled in Argentina or abroad, and/or companies and/or any other type of legal person domiciled abroad. The tax rate is 0.5% of the value of the participation. Such tax does not apply to foreign companies' branches in Argentina. The non-taxable minimum is ARS 6,000,000. In the case of residential real estate where the owner lives, such assets will be exempted from taxation if their value is up to ARS 30,000,000.

Employers contribute to the national unemployment fund, family allowances fund, and social services institute for pensioners at a unified rate of 18% (20.4% for companies who mainly render services or commerce and are above the SME's threshold); plus 6% for the social health care plan. Argentine employers are exempt to pay social security contributions for the first ARS 7,003 per month/employee (plus an additional allowance of ARS 10,000 for small employers with no more than 25 employees). The exempt amount is increased to ARS 17,509 for employers in the textile, leather goods, agricultural industries, and healthcare services sector.
Employers must also contribute to the labour risk insurance (ARS 49.98 per month plus a percentage of the employee's salary according to the sector of activity), as well as to a life insurance fund (ARS 24.35 per month).

Other Domestic Resources
Federal Administration of Public Revenue (AFIP)
Doing Business: Argentina, to obtain a summary of taxes and mandatory contributions
 

Country Comparison For Corporate Taxation

  Argentina Latin America & Caribbean United States Germany
Number of Payments of Taxes per Year 9.0 28.2 10.6 9.0
Time Taken For Administrative Formalities (Hours) 311.5 327.5 175.0 218.0
Total Share of Taxes (% of Profit) 106.3 46.8 36.6 48.8

Source: Doing Business - Latest available data.

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Accounting Rules

 

Accounting System

Accounting Standards
Accounting standards are developed by a national professional body, the Argentine Federation of Professional Council in Economic Sciences (FACPCE). The Central Bank and the National Insurance Superintendency supplement the professional accounting standards with rules designed specifically for entities under their control. Certain rules of these two regulators may give rise to material departures from the accounting standards.
Currently, financial entities are moving to IFRS, in accordance with a decision of the Central Bank that requires the full application of IFRS by 2018.
Accounting Regulation Bodies
Contaduria General de la Nación (Argentine Accountant General), Argentine Accountant General
Federación Argentina de Consejos Profesionales de Ciencias Economicas (Argentine Federation of Professional Councils of Economic Sciences), Organisation responsible for accounting technical standards
Accounting Law
Law #19,550 (in Spanish), 3rd April 1972.
Difference Between National and International Standards (IAS/IFRS)
Listed companies other than banks and insurance companies as well as SMEs are required to prepare their financial statements using IFRSs. Banks need to apply BCRA (Central Bank of the Argentine Republic) standards converged with IFRSs starting from 2018.
 

Accounting Practices

Tax Year
The tax year begins on 1 January and finishes on 31 December of the same year.
Accounting Reports
All commercial companies in Argentina have to draw up certain accounting documents yearly, including the journal, ledger and a follow up of stock evaluation.

Companies are obligated to draw up a balance sheet and a profit and loss account and to submit the documents annually for approval by auditors (from within or outside of the company).

Publication Requirements
Annual financial statements and an auditor’s opinion must be submitted.

Public companies must file interim and annual financial statements with the National Securities Commission and the Buenos Aires Stock Exchange, respectively. The quarterly and annual filings must include consolidated and separate financial statements allowing comparison with the previous year or period.

A private company files its annual financial statements with the Corporate Inspection Department (Inspección General de Justicia) of the relevant jurisdiction.

 

Accountancy Profession

Accountants
The 'Contador Auditor' (chartered accountant) manages the accounting and certifies it within the company.

The 'Contador Publico Independiente' (auditor) certifies the accounts of the contador auditor.
Professional Accountancy Bodies
Professional Council of Economic Sciences, Accounting Professionals
Argentine Federation of Professional Councils of Economic Sciences, Advisory Professionals
Member of the International Federation of Accountants (IFAC)
The Argentine Federation of Economic Sciences Professional Councils is a member of IFAC.
Member of Other Federation of Accountants
Argentina is a member of the Association of International Accountants.
Audit Bodies
Companies must seek a statutory auditor to conduct an annual audit of the financial health of their organisation. Some examples include KPMG, Deloitte, and PriceWaterhouseCooper.
 
 

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Consumption Taxes

Nature of the Tax
Impuesto al Valor Agregado or IVA (Value Added Tax or VAT, in English)
Standard Rate
The general VAT rate stands at 21% and is charged on the net price of transactions. Certain public services such as electricity, water, and sewage disposal or telecommunications companies are subject to an increased rate of 27%.
Reduced Tax Rate
A reduced VAT rate of 10.5% applies to interest and commissions on loans made by banks; sale, preparation, manufacturing or construction and final import of certain capital assets; long-distance passenger transportation (more than 100 km); sale or import of newspapers and magazines, certain medical assistance services.

Exports of goods and services are treated as zero-rated transactions, with the input VAT that can be used as a credit against output VAT or refunded following a special procedure.

Exclusion From Taxation
VAT exempt supplies include education; rental of real estate under certain conditions; books; certain staples, such as water and milk for specified buyers; local passenger transportation rendered by cabs (less than 100 km); international transportation; interest on preferred shares and equity securities, bonds and other securities issued by the federal government, provinces and municipalities.
Method of Calculation, Declaration and Settlement
The rate of VAT is applied to the sales price. VAT registration is required for (a) corporations or other legal entities that commence taxable activities in Argentina, and (b) individuals that have annual taxable turnovers of above ARS 3.7 million for goods and above ARS 2.6 million for services. VAT returns are submitted monthly between the 12th and the 22nd day of the month following the concerned month (depending on the payer's tax identification number). For imports, VAT is computed and paid with custom duties.
VAT for services rendered from abroad has to be paid by the local entity receiving the service, applying the reverse charge mechanism.
Entities must register for IIBB (Ingresos Brutos) if they provide VAT taxable supplies in the course of doing business. No turnover threshold applies.
Other Consumption Taxes
Import duties vary between 0% and 35%. Excise duties apply to tobacco, wines, soft drinks, spirits, gasoline, lubricants, insurance premiums, automobile tyres, mobiles services, perfumes, jewellery, and precious stones. From 1 January 2021 through 31 December 2025, a 17% tax applies to certain electronic products (6.55% on products manufactured by companies benefitting from the incentive provided by the Tierra del Fuego province).

Export duties are imposed on goods and services with general rates of 5% for manufactured goods and services, 8% for hydrocarbons and mining products, 15% for agribusiness products, and 33% for soybean. Furthermore, a 30% solidarity tax applies on all purchases of foreign currency by Argentine individuals for investment purposes, or by companies and individuals for payment of foreign expenditure (e.g. travel and accommodation, foreign digital services for personal use).

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Individual Taxes

Tax Base For Residents and Non-Residents

Residents are taxed on all their national and international incomes while non-residents are only taxed on income received in Argentina.
The Argentinian law divides individuals into three categories concerning their residency status:

  • Residents (nationals living in the country; nationals working abroad for up to 13 months or when they obtain a permanent residence for migration purposes in a foreign country; foreigners assigned to work in Argentina for more than five years; foreigners residing in Argentina not for working purposes, starting from the 13th month)
  • Non-residents (foreigners assigned to work in Argentina for less than five years)
  • Foreign beneficiaries (foreigners working temporarily in Argentina for less than six months in a calendar year; Argentine nationals working abroad once they have lost the tax residence status; and foreigners residing abroad).
 

Tax Rate

Personal Income Tax Rate
ARS 0 -  97,202 5%
ARS  97,202.01 - 194,404 9%
ARS 194,404.01 - 291,606 12%
ARS 291,606.01 - 388,808.01 15%
ARS 388,808.01 - 583,212.01 19%
ARS 583,212.02 - 777,616.01 23%
ARS  777,616.02 - 1,166,424.02 27%
ARS 1,166,424.02 - 1,555,232.07 31%
ARS 1,555,232.07 and above 35%
 
Allowable Deductions and Tax Credits
Employees are subject to withholding tax at source, for which the employer is responsible (withholding agent). Social security contributions withheld by the employer and personal deductions are deductible from employment compensation for income tax purposes.
There are several types of allowances or tax reductions: ARS 260.580 for individuals who have been living in Argentina for at least six months during the calendar year, ARS 235.457,25 for spouses, ARS 118.741,97 for each child younger than 18 years, ARS 335,356.79 for self-employed workers, ARS 419,196.02 for new professionals/entrepreneurs.

Donations to tax-exempt charitable institutions are deductible up to a maximum of 5% of net income, same as for contributions to third-party medical schemes. Other medical expenses may be deducted up to a maximum of 40% of all corresponding invoices of the fiscal year (still capped at 5% of net income). Life insurance purchased from local authorised insurance companies and funeral expenses are deductible (up to limits set annually).

Individuals can deduct up to 40% of their rental expenses (up to a maximum of ARS 167,678.40), provided that they correspond to their dwelling and do not own any real property.
Mortgage and all other interest, alimony, education and childcare expenses are not deductible.

Special Expatriate Tax Regime
Non-resident and foreign beneficiaries are only taxable on their Argentine-source income.
Foreign beneficiaries working temporarily in Argentina for no more than six months during the year, who earn income through either the visual or performing arts or another profession, are subject to a final income tax rate of 24.5% (35% on assumed profit of 70% of gross income) to be withheld by the local payer.
Capital Tax Rate
Resident individuals with total assets above ARS 6 million are subject to Personal Assets Tax at rates ranging from 0.5% to 1.75%. For non-residents, the rate is 0.5% and applies to their assets located in Argentina (does not apply if the tax liability is lower than ARS 250). Equity interests in Argentine companies are subject to a 0.5% tax. Assets located outside of Argentina are subject to higher rates, ranging between 0.7% and 2.25%.

The financial transactions tax of 0.6% on debits and credits in current accounts does not apply on employment compensation and pension payments.
Stamp duty of 1% is levied on the formal execution of public and private instruments including contracts, notarial deeds and promissory notes. Special rates of 0.5%, 1.2%, 3%, and 3.6% apply in certain cases.

Employees contribute to the national unemployment fund, family allowances fund, and social services institute for pensioners at a unified rate of 14%; plus 3% for the social health care plan (subject to a salary cap and an exemption for a portion of the salary; updated 4 times every year in line with inflation).

A tax on real properties is levied annually by provincial authorities, the same as for automobile duty. The province of Buenos Aires has gift and inheritance taxes.

Gross income tax ("Ingresos Brutos") is a provincial tax applicable to self-employed individuals on gross earnings. The average tax rate is 4% in the Federal Capital, with similar rates applying in other provinces. The tax is paid by filing monthly tax returns.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
List of Double Taxation Treaties
Withholding Taxes

Withholding tax rates are:

  • Dividends: 0% resident company - 7% resident individual, non-resident company and non-resident individual
  • Interest: 0% resident company/individual - 15.05%/35% non-resident company/individual
  • Royalties: 0% resident company/individual - 17.5%/28%/31.5% non-resident company - 12.25% (copyrights)/17.5% (film and television, image or sound)/28% (patent)/31.5% non-resident individual

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Latest Update: June 2022