Employing in Argentina: What You Need to Know
The laws and rights that govern employment in Argentina are primarily the Argentine Constitution, international treaties, the Employment Contract Law, several federal statutes and collective bargaining agreements. The federal government may enact employment and labor legislation to all provinces in Argentina as specified in the Argentine Constitution. These employment laws are enforced by the National Ministry of Labor.
The provisions of the Employment Contract Law (Ley de Contrato de Trabajo, LCT) applies to all employees in the private sector (excluding agricultural and domestic workers). The labor laws specify the minimum standards that employees are entitled to and employers must adhere to, applying to all contracts entered into within Argentine territory, regardless of nationality or location.
Key Factors to Consider When Employing in Argentina
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Contracts
There are no legal formalities required to enter into an employment relationship, although a written form of offer letter may better define the terms of the agreement. Once an employment contract has been created, the employee is legally entitled to certain rights. Most contracts are assumed to last for an indefinite term unless specified otherwise in the contract. Once an employment contract has been entered into, the employer has an obligation to register any employment relationships in a Special Payroll Book, subject to periodic supervision by the Ministry of Labor.
There are alternatives to the indefinite term contract, which sometimes require a written agreement to specify special arrangements. These include:
- Probation periods – The first ninety days of all indefinite term employment contracts is the probationary period, where the employee may be discharged without just cause and no further payments with 15 days’ notice.
- Fixed-term contracts – These contracts are uncommon and only apply in situations where the term of contract is fixed and certain, between one month and five years’ set employment duration. The contract may be renewed every five years, although are seen unfavorably in court. Termination of a fixed-term contracts are entitled to 50% of the indemnity for payments to indefinite term employees terminated without just cause.
- Contingent-Temporary contracts – These contracts are created to cover specific types of work or a specific service. A similar form of contract is the contingent-seasonal contract, made for employees who provide services for a specific time of the year.
Employee Entitlements
| Information | Explanation |
|---|---|
| Statutory Working Hours ? | The Employment Contract Law No. 11, 544 specifies the maximum number of regular work hours as 8 hours per day and 48 hours per week for a 6 day work day. The number of work days may be flexible for an unequal distribution of daily hours. The maximum hours worked may be changed through an individual or collective bargaining agreement. No employee may work overtime in excess of 30 hours per month or 200 hours per week. At least 12 hours of rest must be taken between two working days. Overtime during weekdays provide an additional 50% payment based on the employee’s hourly salary rate. Any overtime work on national holidays or during weekends provide an additional 100% payment. |
| Paid Public Holidays ? | In Argentina, there are 12 national holidays that are paid for if they do not work on those days. If employees do work on those days, there are entitled to 100% compensation of their regular hourly wage. |
| Working on Sundays ? | Working on Sundays is permitted, although employees are not expected to do so. A 100% premium of the employee’s wage is required to be paid. Overtime work, including weekend and holiday work, should not exceed 30 hours per month or 200 hours per year. |
| Disclosure and Confidentiality of Personal Information ? | The disclosure of personal data of an employee is only allowed if it is in the interest of the owner of the information and the employee has consented to the disclosure. This consent may be revoked at any time. There are conditions where consent to disclose personal information is not required:
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| Employee Protection and Anti-discrimination Rights ? | Employees are generally protected from discriminatory practices under local laws. Under the Anti-Discrimination Law No.23, 592, any employees dismissed on the grounds of discrimination due to race, religion, nationality, ideology, political affiliation, sex, financial, social or physical condition may demand to be reinstated, demand for the removal of the source of discrimination or be compensated via mandatory severance payments and damages. |
| Time Off Work ? | The employee may request paid special leave of absence in certain cases, and may be extended at the discretion of the employer. Collective bargaining agreements may grant additional days of leave. The conditions are:
Female employees are entitled to 90 days’ paid maternity leave; 45 days before and after childbirth. The employee may request additional unpaid leave of three to six months. |
| Medical Leave ? | In the case of illness or accident unrelated to work, employees may take up to three months’ paid leave if he/she has been with the employer for less than five years, and up to six months’ paid leave for those working for longer than five years. If the employee receives family allowances, the paid sick leave entitlement doubles. Once the paid sick leave period expires, the employee must keep the position open for at least 12 months. If the employee is still unfit for work, severance pay should be granted to the employee. Any accident or illnesses caused by work-related problems entitles the employee to 12 months compulsory rehabilitation and sick pay under the compulsory employment risk ensurance (Aseguradora de Riesgos del Trabajo). Accidents and Diseases Not Related to Work Leave of absence due to accidents or diseases are provided for by the Employment Contract Law. Employees are entitled to up to three months of paid leave for occupation-related accidents or diseases when the employee has been working for less than 5 years with the employer, and up to six months for employment longer than 5 years. Any period longer than the paid leave duration requires the employer to keep the position of the employee for at least 1 year. Any period longer than this may allow either party to terminate without right to severance indemnity. |
| Annual Leave Accrual Entitlement ? | Employees have a minimum period of paid annual vacations depending on seniority. They are:
The number of vacation days may be freely extended by the employer. The vacation must lie between October 1 and April 30 of the following year, with the employee receiving a 45 day prior written notice for the vacation period. Failure to take vacations are not compensated unless it is collected upon termination of employment. Only a third of the period of vacations may be accumulated in the subsequent year. |
| Maternity Leave in Argentina ? | In Argentina, employers are not allowed to employ female workers if they are within 45 days before or after childbirth. Employees taking maternity leave are entitled to cash benefits paid out of Social Security Funds. It is unlawful for an employer to terminate a female employer during her pregnancy or maternity leave unless on grounds unrelated to the pregnancy. Any dismissal made within 7 ½ months before or after childbirth is presumed to be due to pregnancy, unless the employer can prove there is an unrelated reason for dismissal. Failure to do so entitles the employee to a one year’s salary worth of indemnity.
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| Employment Termination in Argentina ? | Under the Employment Contracts Law, either the employer or the employee may terminate their contract in various ways:
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Employment Termination
| Information | Explanation |
|---|---|
| Resignation / End of Service Payment ? | Termination of the contract due to redundancy provides the employee with a reduced severance payment of 50% of the normal severance pay in the case of regular dismissal. Redundancy is justifiable for the employer if they can prove the dismissal was due to reduction in production outside the employer’s power, or force majeure. |
| Severance / Redundancy Pay ? | Severance pay is calculated based on the employee’s highest regular, monthly salary accrued over the last year. The cap for calculation of seniority indemnity must not be less than 67% of the computable best ordinary usual monthly remuneration. For fixed-term employees with premature termination of their contract, the severance payment consists of the remaining salary that would have been paid until the completion of the contract. Fixed-term employees who have been working for longer than a year are also entitled to 50% of the severance pay that a permanent employee would have received. There are certain causes where employees may be entitled to additional severance pay, such as employment with union representatives. A special procedure must be followed before the Labor Courts, as employees may only be terminated with just cause. IF the procedure is not followed, the representative may choose being reinstated or receiving a significant severance pay package. Termination due to pregnancy or discrimination also allows additional severance payments. |
| Termination of Employment ? | The duration of the notice period depends on certain conditions:
Payment in lieu of notice applies in these cases. |
| Statutory Notice Period Employer With Cause ? | Termination by just cause is justifiable by the employer if the employee has engaged in activities offensive or prejudicial to the employer, such as insulting superiors, disloyal behavior and theft of company goods. A sufficient cause is determined by the general principles of law and legal precedents. Termination by this method requires a written explanation of the cause, which may be challenged in a judicial proceeding. |
| Statutory Notice Period Employer Without Cause ? | The employer may terminate the employment relationship without just cause, which requires a severance to the employee, except in the case of union representatives and workers council representatives, which requires a just cause of termination. |
| Payment in Lieu of Notice ? | In addition to the pay in lieu of notice, the employer must also pay a termination indemnity, based on the years of service. |
Probation
| Information | Explanation |
|---|---|
| Probation Period ? | All indefinite term employment contracts according to the Employment Contract Law are subject to a trial period, unless otherwise agreed upon by the parties. The employer is obligated to provide a 15-day termination notice. The employer may terminate the employee without just cause and are not required to pay additional payments, unless a termination notice is not provided. During the trial period, the employer and employee may pay social security contributions. Only one trial period can be entered into with the same employer. |
Pension
| Information | Explanation |
|---|---|
| Pension Requirements ? | All employees working in Argentina must be covered by the Argentine Social Security System under the Retirement and Pension Law No. 24, 241, and that all employees be registered with the social security authorities. There are two pension systems employees may manage their future retirement:
Contributions by the employee may finance some benefits common to both systems, including an earnings-related disability pension and an earnings-related death benefit. Choosing the public pension regime entitles the employee to an earnings-related retirement pension, while the private system entitles the employee to a retirement pension dependent on the mandatory and voluntary amounts contributed to the pension fund. The social security system provides for the payment of retired men from 65 and for women aged 60, although female employees may work until they are 65. TO be entitled to the social security contributions, evidence of social security payments must be provided for the last 30 years. There is no limitation on additional benefits an employer may pay to their employee. |
GEO Solutions or DIY Employment in Argentina?
Companies entering Argentina must make a decision whether to use their own resources for a Do-It-Yourself (DIY) approach, or to use a Global Employment Organization to handle payroll and employment responsibilities. A GEO or Argentinian Employer of Record solution makes it faster, easier and cheaper to deploy staff if they don’t have an Argentinian entity established that can run payroll.
A DIY approach will typically be delayed until there is a properly incorporated company ready to run payroll and may be a costly option. Shield GEO can deploy foreign staff in 4-6 weeks and local staff in 48 hours. Additionally Shield GEO is responsible for all compliance issues related to the employment.
Outsourcing Employment Through a GEO Employer of Record Service
Using Shield GEO Employer of Record Services in Argentina
Compliance with local employment requirements is just one of the issues foreign companies face when employing staff in Argentina. For companies which intend to employ their staff directly through their incorporated Argentina entity, professional legal advice is recommended. Shield GEO provides an alternative path for companies to outsource the employment of their staff in Argentina.
As a Global Employer Organization (GEO), Shield GEO acts as the Employer of Record and ensures the employment is compliant with host country regulations regarding employment. In addition Shield GEO will handle payroll processing, tax and immigration. Using Shield GEO is the fastest and most cost effective way to deploy local and foreign workers into Argentina.
The Shield GEO solution is an attractive alternative where
– the company is looking to employ staff quickly
– the company doesn’t have an appropriately incorporated entity in Argentina
– the company wants to work within a defined budget
– the company wants to limit its initial commitment in Argentina
– the company needs help with tax, employment, immigration and payroll compliance in Argentina
Shield GEO can contract directly with the company to employ and payroll their staff in Argentina. Shield GEO supplies local employment contracts for the staff which ensure that local statutory requirements are met covering issues such as termination, probation periods, leave entitlements and statutory benefits. Shield GEO is able to advise companies how to cover local employment regulations whilst still providing consistent global employment policies. Understand more about outsourced employment through Shield GEO.
Payroll
| Payroll | Argentina |
|---|---|
| Management Fee for Employer of Record Services / Monthly Payroll Costs | Please contact us for a quote |
| Notes | Shield GEO pays the employee on a monthly basis, typically on the last working day of the month although we can adapt to your preferred schedule. Income tax and social security (where applicable) are deducted at source and paid to the local tax authorities. |
| Currency ? | Argentine Peso (ARS) |
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| Tax Returns Supplied | Yes |
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| Employers Social Security and statutory contributions |
Employer social security contributions are current 27%, spread across contributions to the Pension Fund, Pensioner’s Healthcare Fund, Family Allowance Fund, Unemployment Fund and Medical Care. |
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| Employees Social Security and statutory contributions |
Employee social security contributions are currently 17% of gross wages, up to a monthly cap of ARS 13,879.25. 11% is towards the pension fund, 3% towards the Pensioner’s Healthcare Fund and 3% to Medical Care. |
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Payroll and Tax in Argentina
| Information | Explanation |
|---|---|
| Remote Payroll ? | A remote payroll system is where a foreign company, i.e. a non-resident company, payrolls a resident employee in Argentina. Under Argentine Law, companies registered in other countries are allowed to obtain a license to do business and have employees in the country. |
| Local Payroll Administration ? | In some cases, a company will register their business in Argentina under the various business entity types available, but prefer to have another company administering its payroll. This can be accomplished through a payroll provider. It is important to note that the company, as the Employer of Record, is still fully responsible for compliance with employment, immigration, tax and payroll regulations. But the payroll calculations, payments and filings can all be outsourced to the payroll provider. |
| Internal Payroll ? | Larger companies with a commitment to Argentina may wish to run their own local payroll for all employees, foreign and local. In order to accomplish this, they will have to complete incorporation, register the business and then hire the necessary staff. There will be a need for in country human resources personnel who have the background needed to manage an Argentine payroll, and can fulfil all tax, withholding, and payroll requirements. This approach carries significant cost and requires some knowledge of local employment and payroll regulations. The company will need a local accounting firm and potentially legal counsel to ensure full compliance with Argentine employment laws. |
| Fully Outsourced Payroll & Employment ? | Companies can outsource the employment and payroll of their staff in Argentina to a GEO, like Shield GEO. This is possible for both foreign workers and Argentine nationals. This is the easiest, fastest and safest way to payroll staff in Argentina. Shield GEO manages all aspects of payroll for workers in Argentina, including taxes, withholding, social security payments and other statutory requirements. Shield GEO becomes the Employer of Record and employs the staff on behalf of the client. Staff are paid monthly with tax and social security deducted at source and paid to local authorities. Shield GEO will invoice the client monthly in advance of the payroll date. The invoice consists of the Total Cost of Employment (Base salary + Employers Statutory Contributions + Additional statutory contributions) and a Management Fee. Shield GEO provides the employees with payslips. Read more about outsourced payroll and employment through Shield GEO. |
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Setting up payroll in Argentina
| Information | Explanation |
|---|---|
| Currency ? | Argentine Peso (ARS) |
| Employee Information Required ? | The following information is required for an employee to be registered in the Special Payroll Book, which must be registered immediately by the company upon hiring, and is subject to control and supervision by the Argentine Ministry of Labor:
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| Tax Registration Requirements ? | Argentine companies should register their employees with the tax authority and retain taxes from employee salaries. Under Section 52 of the Employment Contract Law, the employer must keep a Special Labor Ledger that is registered and sealed by the Department of Labor to register employer and employee’s particulars and other aspects pertaining to taxation. Tax and social security registration are both done at the National Tax Office (Administración Federal de Ingresos Públicos, AFIP). Employees of the company should obtain their Tax Identification Number (CUIT) to be registered with the taxation authority. |
| Social Security Registration ? | The hiring or termination of an employment contract should be reported to the AFIP for the employee to be registered with the Social Security Registry. Notice of the arrangement must be given before the starting date. A receipt in original will be provided to the employer, while a duplicate is given to the employee once the registration has been processed. |
| Documentation Required for New Employees ? | For newly hired employees, indefinite term contracts are not required to be in writing. Offer letters are typically not provided when hiring under this arrangement, although a written formality may be appropriate if there are certain issues to be clarified. If an employment contract is to be drawn, the following details may be included:
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Tax Figures
| Information | Explanation | |||||||||||||||||||
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| Corporate Income Tax ? | The corporate income tax rate is 35%. |
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| Income Tax Rate ? |
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| Payroll Tax ? | There is no payroll tax in Argentina. |
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| Sales Tax ? | The general Value Added Tax (VAT) is 21%, which increases to 27% to certain services such as communication and utilities provisions and decreases to 10.5% for capital goods and other specified items. The export of goods and services have no VAT. There is also a provincial level sales tax in some municipalities levied at 4% of gross revenue. Higher rates may be levied for certain services or industries and in certain provinces. |
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| Withholding Tax ? | Dividends paid to nonresidents have a withholding tax of 10%. An additional withholding tax applies if the dividends received exceed the payer company’s accumulated taxable income, standing at 35%. Interest paid to nonresidents have a withholding tax of 35%, but may be reduced to 15.05% if the borrower is a financial institution, bank or in special circumstances. Royalty payments made to nonresidents are subject to a withholding tax of 35% on 35% of the gross payment, at an effective rate of 12.25%. Patent royalties and technical assistance fees have varying withholding taxes depending on payment type, ranging from an effective rate of 21% to 31.5%. |
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| Other Tax ? | Real estate tax – The provincial governments levy a real estate property tax on both urban and rural land, with differing rates depending on the jurisdiction. Stamp duty – Documents such as contracts, notarial deeds, receipted invoices, promissory notes and other instruments are subject to stamp tax. The stamp duty is generally 1%, although may range from 2.5% to 4% depending on nature of tax and province. Customs and excise duties – Export duties depend on the nature of the goods exported, while excise taxes are levied on certain products only, e.g. fuel, luxury items and cigarettes. Financial transaction tax – All financial transactions are taxed at 0.6% per transaction on all debits and credits in current accounts. Net wealth tax – An asset tax of 0.5% applies to equity interests held by a resident or nonresident individual in a company incorporated in Argentina. |
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| Income Tax (Personal Allowance) ? | Up to ARS 15,552 are able to be deducted for basic personal allowance. |
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| Time to prepare and Pay Taxes ? | 359 Hours |
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| Time required to start a Business ? | 25 Days |
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Payments
| Information | Explanation |
|---|---|
| Payment Mode ? | Traditionally, Argentina has widespread use of cash to make payments. Since 1997, companies are required to pay their employees via bank automated payroll deposits instead of cash. Alternatively, deferred checks are quite a popular method, while direct bank deposits are also used to some extent. |
| Frequency of Salary Payment ? | The most common frequency of salary payment is monthly, although daily wages can be settled weekly or fortnightly. The salary must be paid within four working days at the end of the month. There is a mandatory bonus scheme in Argentina known as the 13th month Salary, where half the employee’s monthly salary is paid mid-year and the other half at the end of the year. |
| Invoice / Payslips required ? | Under Article 59 of the Argentine Labor Law, any payment made regarding salary must be accompanied by a receipt signed by the worker. A duplicate is given to the employee, and must include full name, address and CUIT, types of remuneration received, deductions, proof of receipt, place and date. |
| Minimum Wage ? | As of January 2016, the minimum wage stands at 6060 ARS per month, paid 13 times a year. |
Immigration and Work Permits in Argentina
Argentina has a relatively open view to encouraging foreign workers to embrace the country, ensuring that all foreigners benefit from all civil rights of citizens and will not be subject to any additional charges or requirements because of their status, as declared in Article 20 of the National Constitution. There are also less stringent rules, such as no minimum language requirements, no industry quota limits and no medical screening required.
Immigration laws governing foreign workers come in three forms:
- Federal immigration laws
- Bilateral treaties
- MERCOSUR decisions
These laws define the status of residency for foreign entrants into the country for work purposes, and outlines the conditions that residency and visa documents must be obtained, such as nationality, purpose and duration of stay. The process of corporate immigration is administered by the Argentine Immigration Department (Direccion Nacional de Migraciones, DNM) through their nationwide and consular jurisdictions.
Employers should note that companies wishing to hire foreign nationals must go through a process of registration prior to sponsoring foreign employees.
Have your own company?
The process of sponsoring a foreign worker in Argentina requires an appropriate visa and an entry permit for the employee. In most cases of corporate immigration, a temporary residence visa is obtained. Prior to that, the employer must take the necessary steps to register with the relevant authorities to have permission to employ foreign workers.
Procedure:
1. Registering company with sponsorship authorities
The first step is to ensure the company have the permits the hire foreign nationals. The company incorporated in Argentina must enroll in the National Immigrant Sponsors Registrar (Registro Nacional Único de Requirentes Extranjeros, RNURE).
Registration with the National Registry will permit local companies to employ non-MERCOSUR foreign staff for different visas and an identification number for the sponsored employee.
Once the company has enrolled with the registrar, they must ensure all foreign employee related data must be updated, and all changes to the employment of expatriates must be notified to the registry office with 15 days of occurrences. Immigration authorities also may undertake random inspections to verify immigration compliance.
Documents required by employer:
- Document with legal address of the company
- Completed proof of legal status of registration with the corresponding Argentine authorities
- Statute or Social Contract legally registered with the General Inspection of Justice (Inspección General de Justicia, IGJ)
- Attested legal documentation for any relevant documentation registered with the IGJ
- Proof of registration with the tax system with the Federal Public Revenue Administration (Adminstracion Federal de Ingresos Publicos, AFIP)
- ID card and a photocopy of the company representative performing procedure along with any required proof of authorizing power
- Accredited designation of an applicant as a delegate of the organization
2. Document procurement and legalization
The necessary documents must be legalized and procured by the employee, who is the applicant for the visa and entry permit. Different cases and visas will require different documents, though in general the required documents will be similar. These documents must then be provided to the employer in Argentina.
Documents required by employee:
- Birth certificate
- Marriage certificate
- Police clearance certificate
- Domicile certificates in Argentina
- Copy of corporate tax document
- Copy of corporate registration certificate of company
- All documents must be translated to Spanish and legalized with an apostille from the Argentine Sworn Translators Association
Time: 2 – 4 weeks
3. Obtaining an entry permit
The employer applies for an entry permit (Permiso de Ingreso) for each employee that is to be hired. This is done through the Argentine Immigration Department (Direccion Nacional de Migraciones, DNM), where the employee’s application and supporting documents are provided by the employer to the Department. The Department will be reviewed by the immigration authorities and will be issued if there are no objections raised.
Documents required by employee:
- Entry permit application
- All supporting documents provided by employee in Step 2
Time: Approximately 30 days depending on location
4. Temporary residence visa application
Before the permit is approved, it will be sent to the closest Argentina consulate in the employee’s country of residence, where he/she will be apply for the residence visa. The application may also be filed in-country, which will take less time.
An application for a temporary residence visa is submitted to the DNM, where the employee must appear personally at the local Argentine consulate for an interview. Once the employee is cleared, he/she will be provided with the entry permit and residence visa.
All workers travelling to Argentina must pay a reciprocity fee of $US100 before entering Argentina. This is paid to the DNM online, and is equivalent to a multiple-entry fee. Different countries may require different fees to be paid.
Documents required by employee:
- Valid ordinary passport with at least 6 months validity
- Return flight ticket
- Evidence of sufficient funds for stay in Argentina if required
- Document as proof of stay at an address
- Receipt for the reciprocity fee
Time:
5 – 15 days for consulate interview process
20 – 30 days for overall processing
Cost:
US$160 reciprocity fee
US$80 consular certification charge
5. Travel to Argentina
Once the visa has been approved and the entry permit acquired, the employee may travel to Argentina to commence work. Typically, final approval for the temporary residence permit may take up to three months. In these cases, an interim permit (residencia precariat) is granted to the employee, permitting them to legally work in Argentina as well as leaving and re-entering while the visa is being approved.
6. Application for the Work Identification Number
Once the worker arrives in Argentina, the employee applies for a work identification number (Código Único de Identificación Laboral, CUIL) so they can be enrolled on a local payroll. It also serves as an individual tax identification number for employers to withhold income taxes of the employee.
The CUIL may be applied for by the employee or employer at various locations, including online through the National Social Security Administration (Administración Nacional de la Seguridad Social, ANSES), in person at an ANSES office, or by telephone.
Documents required by employee:
- DNI or driving license if a permanent resident
- Proof of address, including name of applicant
- Entry permit issued by the Argentine consulate
- National Population and Migration Certificate (Certificado Nacional de Población y Migraciones)
Time: 24- 48 hours
Cost: Free
7. Application for a National Identity Card
The employee must apply for a National identity Card (Documento Nacional de Identidad, DNI), which functions similar to a social security number. The worker will use this as a national identity document, and will be required for renting and purchasing property, creating a bank account and entering into contractual agreements.
To obtain the DNI, the employee must register with the local population office (Registro Nacional de las Personas) within 90 days of arrival in Argentina. Each family member must obtain a DNI if they travel to Argentina as well.
Once the DNI is approved, the employee may continue to work legally in Argentina under the employer.
Documents required by employee:
- Proof of address
- Certificate of residence issued by the DNM
- Original birth certificate, legalized in the country of origin or have a Hague apostille stamp attached if employee is from a Hague Convention signatory country.
Time: 2 – 3 months
Cost: approximately $40 pesos
Use the Shield GEO Employer of Record Solution?
Once you get in touch with us, one of our consultants will take all the work off your hands, co-ordinate with our local partners to get all the required permits organised, provide the processing time, costs, document-checklist and keep you informed through the process. Contact us to know more.
Types of visas in Argentina
| Category | Description of Visa |
|---|---|
| Temporary Residence Visa | The temporary residence visa is the most common type of visa issued for corporate immigration for a foreign national to work in a company in Argentina. There are several types of temporary residence visas depending on the nature and purpose of travel. These include: This visa is issued by the National Directorate of Migration (DNM). All types of temporary residence visas are valid for up to one year, and can be extended indefinitely by applying to the DNM. Required documents: Cost: Approximately US$160 reciprocity fee, depending on country |
| Transitory residence visa | These visas are issued for short-term assignments, which allow the individual to work for up to a maximum of 90 days. There are several types of transitory residence visas, including technical residence, for workers who will perform technical activities for a short time, and business visas, issued to those who were invited by a local Argentine company. The transitory residence visa may be issued up to two times per year for a 90-day period each, and may not be extended. Required documents: Cost: Approximately US$160 reciprocity fee, depending on country |
| Permanent residence visa | The permanent residence visa allows the foreigner an indefinite right to reside and work in Argentina. This visa is issued in limited cases, such as workers who are already on assignments who have a Temporary Residence visa, or those from a MERCOSUR country. Those with spouses with a permanent residency status in Argentina may also obtain this visa. Documents required: Cost: Approximately US$160 reciprocity fee, depending on country |
Setting up a company in Argentina
When setting up a company you may want to consider these factors:
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Business Factors
Argentina is an attractive location for foreign investment due to the large population of qualified human workers and commercial partnerships with neighboring countries like Brazil. Argentine workers have the highest income per capita in Latin America, while the population enjoys the lowest illiteracy rates in the region. The economy of Argentina heavily relies on a well-developed infrastructure network, providing access to the MERCOSUR markets as well.
Argentine laws do not pose restrictions on foreign investments, which encourages open investment for foreigners. Under the Argentine constitution, foreign investors enjoy the same legal treatments as domestic companies and individuals. Foreign companies may also invest without pre-approval or registration pre-requisites. The government has also implemented general, sectorial and regional incentives to promote further investments into the Argentine economy. Employers should also consider the following when making investment decisions:
- The industry and type of business that will be conducted
- Nationality of the headquarters/individuals
- Presence of existing trade agreements on relationships
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Location
Location will be another factor. Separate cities and regions may have different rules, costs and availability. It is always recommended to seek advice from relevant professionals, such as business or legal advisors, accountants and others depending on your needs.
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Language
There are over 40 languages spoken in Argentina, with Spanish as the dominant and the de facto official language. In descending order of usage, the most known languages in Argentina are subsequently English, Portuguese, Italian, French and German. There is also a significant Italian-speaking population in Argentina.
There are several types of business forms available to foreign companies in Argentina. Each of these business forms has distinct advantages and disadvantages, as well as differing scope of business activities, registration requirements and minimum capital requirements. In most cases it will depend on the degree of commitment a company has to Argentina and the planned business activity.
When setting up a company in Argentina, you have the following options:
- Corporations
- Limited Liability Partnership
- Foreign Branch
- General Partnership
Corporations
Corporations (sociedades anónimas) are the most common business entities in Argentina. The control of the company is distributed among shareholders, where their liability is limited to their paid-in capital. In Argentina, corporations are subject to supervision and control by government authorities. Publicly held corporations are supervised by the Comisión Nacional de Valores, which functions similarly to the Securities Exchange Comission in the U.S. Privately held companies are controlled by the General Inspection (Inspección General de Justicia).
Liability
Limited Liability: Liability of each shareholder is only limited to the capital they have invested in.
Minimum Ownership
The corporation may be a 100% foreign-owned entity.
Number of Founding Members
A minimum of two shareholders are required, who can be natural persons residing in Argentina or not, or local or foreign companies themselves.
Minimum Capital Requirements
$12,000, divided in non-endorsable nominative shares.
Procedure
1. Verification of company name
The name of the company is verified by the Office of Corporations (Inspección General de Justicia, IGJ). This name should be reserved by submitting a request to the IGJ, which can be done online.
Required documents:
- Reservation of name form (reserve de nombre)
Time: 1 day
Cost: ARS 210
2. Certifying signatures of partners by a notary public
The signatures of the founding partners should be certified by a notary public. It is optional to notarize the company’s bylaws, which may be formally constituted under a private document.
Time: 1 day
Cost: approximately ARS 250 for each signature
3. Deposit of capital at a bank
An initial capital deposit should be made for the initial start-up capital at the National Bank (Banco de la Nación Argentina). At least 25% of the subscribed capital in the National Bank. The deposit should be made at the central office of the national bank or at a local branch. Proof of payment should be obtained. This deposit may be withdrawn once the company’s bylaws are registered at the Office of Corporations.
Time: 1 day
Cost: ARS 45
4. Publishing of new company’s notice in official paper
The establishment of the company notice must be published in the official paper (Boletín Oficial). The notice should be legalized, signed by an attorney or an authorized representative certified by a notary public. The cost of this publication depends on how fast the method is and the notary public fees.
Time: 2 days
Cost: ARS 2,500 for publication + ARS 100 legalization of signature
5. Payment of incorporation fee
The fee for incorporation should be paid through downloading the invoice from the Justice and Human Rights Department then paid to the National Bank. The invoice is then submitted to the Public Registry of Commerce.
Time: 1 day
Cost: ARS 100
6. Registration with the Public Register of Commerce
Companies located in the City of Buenos Aires should register their by-laws and other corporate documents related to the incorporation at the Public Registry of Commerce of the City of Buenos Aires.
Documents required:
- Articles of Association
- By-laws
- Publication in the Office Gazette
- Proof of manager’s acceptance of position
- Evidence of deposit of capital deposit at National Bank
- Evidence of compliance with managers’ guarantee regime
- Evidence of the reservation of the corporate name
Time: approximately 45 days, or 5 days for expedited procedure.
Cost: approximately ARS 3,360
7. Obtain a form from the Public Notaries College and have a notary submit the company books for rubrication by the General Inspection of Justice (IGJ)
Once the company is registered, the company must obtain special books from commercial bookstores. The rubric of the following books are required:
- Book of Minutes of Partners’ and Managers’ Meetings
- Buyers VAT Book
- Sellers VAT Book
- Inventory and Balance Book
- Journal
A notary public requests a form from the Notary Public’s College and submits a rubric request of the company books to the IGJ.
Time: 5 days for expedited filing
Cost: approximately ARS 3,018 including cost of books, cost of IGJ form, notary fees and book registration fees.
8. Corporate manager obtains a Fiscal Code
The legal representative, typically a corporate manager, obtains their Fiscal Code (Clave Fiscal) at the National Tax Office (Administración Federal de Ingresos Públicos, AFIP), which requires their national identity card and a photocopy of it. Non-Argentinean residents must link their CUIT with a person who has a Fiscal Code.
Documents required:
- National identity card and photocopy
- Complete valid passport (if non-Argentinean)
- Residency certificate (if non-Argentinean)
Time: 1 day
Cost: free
9. Obtain a tax identification number from the National Tax Office and register for social security
Registration of tax and social security may be completed at the National Tax Office (Administración Federal de Ingresos Públicos, AFIP). To obtain the Tax Identification Number (Código de Identificación Tributaria, CUIT) all members of the corporation that have been appointed as managers must have previously obtained their CUITs, while the sole legal representative, or administrator, needs to obtain his/her Fiscal Code.
Time: 4 days
Cost: free
10. Register turnover tax at local level at the Administración General de Ingresos Públicos (AGIP) in the City of Buenos Aires
The legal representative needs to obtain the company’s tax password issued by the General Revenue Directorate (Dirección General de Rentas, DGR). The representative should file the necessary documents to obtain the tax password. It is possible to register the company before the turnover tax through the DGR online.
Documents required:
- Notarized copy of the company’s bylaws and the last designation of authorities registered before the General Inspection of Corporations
- National identity card of the legal representative, original or a notarized copy.
- Evidence of the company’s CUIT
- Evidence of the legal representative’s CUIT
- Document evidencing the legal representative’s address
Time: Less than one day (online)
Cost: free
11. Register with the Sistema Unicon de Seguridad Social (SUSS)
The procedure can be completed online by submitting a sworn affidavit form No.885 to the AFIP. The social security withholdings and contributions are paid to the National Regime of Social Security.
Time: Less than one day (online)
Cost: free
12. Rubricate books of wages in the Ministry of Labor
The Labor Agency (Dirección General de Empleo) rubricates the company’s books. The appointment with the Labor Agency can be scheduled online to rubricate the books. The fee required depends on the number of pages the employer must rubricate.
Time: 1 day
Cost: ARS 5 per page
Limited liability partnership
Limited liability partnerships (Sociedad de Responsabilidad Limitada) functions through partners, who can be individuals or companies, and either Argentinian or foreign. Partners have limited liability, and foreign partnerships must have the partnership’s statutes submitted to the Public Registry of Commerce. The continuity of the partnership depends on the relations among the existing partners, as a majority of decisions require unanimous consent.
Liability
Limited Liability: Liability of each partner is only limited to the capital they have invested in.
Minimum Ownership
The partnership may be a 100% owned by foreign partners.
Number of Founding Members
A minimum of two partners are required, who can be natural persons residing in Argentina or not.
Minimum Capital Requirements
There are no minimum principal requirements.
Procedure
1. Verification of partnership name
The name of the partnership is verified by the Office of Corporations (Inspección General de Justicia, IGJ). This name should be reserved by submitting a request to the IGJ, which can be done online.
Required documents:
- Reservation of name form (reserve de nombre)
Time: 1 day
Cost: ARS 210
2. Certifying signatures of partners by a notary public
The signatures of the founding partners should be certified by a notary public. It is optional to notarize the company’s bylaws, which may be formally constituted under a private document.
Time: 1 day
Cost: approximately ARS 250 for each signature
3. Deposit of capital at a bank
An initial capital deposit should be made for the initial start-up capital at the National Bank (Banco de la Nación Argentina). At least 25% of the subscribed capital in the National Bank. The deposit should be made at the central office of the national bank or at a local branch. Proof of payment should be obtained. This deposit may be withdrawn once the company’s bylaws are registered at the Office of Corporations.
Time: 1 day
Cost: ARS 45
4. Publishing of new partnership’s notice in official paper
The establishment of the partnership notice must be published in the official paper (Boletín Oficial). The notice should be legalized, signed by an attorney or an authorized representative certified by a notary public. The cost of this publication depends on how fast the method is and the notary public fees.
Time: 2 days
Cost: ARS 2,500 for publication + ARS 100 legalization of signature
5. Payment of incorporation fee
The fee for incorporation should be paid through downloading the invoice from the Justice and Human Rights Department then paid to the National Bank. The invoice is then submitted to the Public Registry of Commerce.
Time: 1 day
Cost: ARS 100
6. Registration with the Public Register of Commerce
Companies located in the City of Buenos Aires should register their by-laws and other corporate documents related to the incorporation at the Public Registry of Commerce of the City of Buenos Aires.
Documents required:
- Articles of Association
- By-laws
- Publication in the Office Gazette
- Proof of manager’s acceptance of position
- Evidence of deposit of capital deposit at National Bank
- Evidence of compliance with managers’ guarantee regime
- Evidence of the reservation of the corporate name
Time: approximately 45 days, or 5 days for expedited procedure.
Cost: approximately ARS 3,360
7. Obtain a form from the Public Notaries College and have a notary submit the company books for rubrication by the General Inspection of Justice (IGJ)
Once the company is registered, the company must obtain special books from commercial bookstores. The rubric of the following books are required:
- Book of Minutes of Partners’ and Managers’ Meetings
- Buyers VAT Book
- Sellers VAT Book
- Inventory and Balance Book
- Journal
A notary public requests a form from the Notary Public’s College and submits a rubric request of the company books to the IGJ.
Time: 5 days for expedited filing
Cost: approximately ARS 3,018 including cost of books, cost of IGJ form, notary fees and book registration fees.
8. Corporate manager obtains a Fiscal Code
The legal representative, typically a corporate manager, obtains their Fiscal Code (Clave Fiscal) at the National Tax Office (Administración Federal de Ingresos Públicos, AFIP), which requires their national identity card and a photocopy of it. Non-Argentinean residents must link their CUIT with a person who has a Fiscal Code.
Documents required:
- National identity card and photocopy
- Complete valid passport (if non-Argentinean)
- Residency certificate (if non-Argentinean)
Time: 1 day
Cost: free
9. Obtain a tax identification number from the National Tax Office and register for social security
Registration of tax and social security may be completed at the National Tax Office (Administración Federal de Ingresos Públicos, AFIP). To obtain the Tax Identification Number (Código de Identificación Tributaria, CUIT) all members of the corporation that have been appointed as managers must have previously obtained their CUITs, while the sole legal representative, or administrator, needs to obtain his/her Fiscal Code.
Time: 4 days
Cost: free
10. Register turnover tax at local level at the Administración General de Ingresos Públicos (AGIP) in the City of Buenos Aires
The legal representative needs to obtain the company’s tax password issued by the General Revenue Directorate (Dirección General de Rentas, DGR). The representative should file the necessary documents to obtain the tax password. It is possible to register the company before the turnover tax through the DGR online.
Documents required:
- Notarized copy of the company’s bylaws and the last designation of authorities registered before the General Inspection of Corporations
- National identity card of the legal representative, original or a notarized copy.
- Evidence of the company’s CUIT
- Evidence of the legal representative’s CUIT
- Document evidencing the legal representative’s address
Time: Less than one day (online)
Cost: free
11. Register with the Sistema Unicon de Seguridad Social (SUSS)
The procedure can be completed online by submitting a sworn affidavit form No.885 to the AFIP. The social security withholdings and contributions are paid to the National Regime of Social Security.
Time: Less than one day (online)
Cost: free
12. Rubricate books of wages in the Ministry of Labor
The Labor Agency (Dirección General de Empleo) rubricates the company’s books. The appointment with the Labor Agency can be scheduled online to rubricate the books. The fee required depends on the number of pages the employer must rubricate.
Time: 1 day
Cost: ARS 5 per page
Foreign Branch
The foreign branch in Argentina are not considered a separate legal entity, but an extension of the overseas parent company. Setting up a branch is ideal for companies who wish to establish a limited business presence in the company before making a larger investment commitment. Liability of the foreign branch rests entirely on the parent company. If the foreign branch has a permanent establishment in Argentina, then profits are liable to the Argentine Corporation tax.
For a foreign company to set up a branch in Argentina, the following steps must be taken:
- Prove the existence of the parent company abroad, register the parent’s articles of incorporation or partnership contract with the Register of Commerce and register any representatives.
- Publication and registration requirements should be followed as Argentine companies do.
- Establish a domicile in Argentina.
- Appointment a representative or manager.
- Assigned capital must be provided, although there are no maximum or minimum limits. The capital should be registered before the Public Registry of Commerce.
- Accounting of the branch must be kept separate to the headquarters, and filed with the IGJ.
- Should register the Social Agreement of the Headquarters in the Public Registry of Commerce.
General Partnership
General Partnerships (Sociedad Colectiva) are similar to limited partnerships, although the responsibility of partners is joint and unlimited. Once all assets are depleted, the general partners are liable for all obligations of the partnership. There are no minimum capital requirements and unanimous consent is required for liquidation.
Outsourcing Employment Through a GEO Employer of Record Service
Whether to incorporate in Argentina, and what sort of entity to setup are just two of the many choices companies must make when expanding into a new market.
If the company intends to have staff in Argentina they must also decide whether they will administer that employment internally or use a Global Employment Organization to handle payroll and Employer of Record responsibilities. A GEO Employer of Record solution is an attractive alternative where
- the company is looking to setup an office quickly
- the company wants to work within a defined budget
- the company wants to limit its initial commitment in Argentina
- the company needs help with tax, employment, immigration and payroll compliance in Argentina
The complexity of employment regulations in Argentina makes the use of a GEO advisable coupled with local legal counsel to ensure full compliance with employment laws, for example the drafting of local contracts for workers.
Shield GEO provides a comprehensive service in Argentina allowing companies to deploy their staff quickly with reasonable, clearly stated costs and timeframes. The company contracts directly with Shield to employ and payroll their staff on their behalf in Argentina.
Shield GEO then becomes the Employer of Record. Shield GEO assumes the legal responsibility for these employees, sponsoring them on work permits, complying with local employment law and running their monthly payroll. Using Shield GEO is the fastest and most cost effective way to deploy local and foreign workers into Argentina. Read more about outsourced employment through Shield GEO.
- Argentina Employer of Record Overview
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