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Peru
We have a team of experienced professionals dedicated to supporting all your business requirements—ensuring smooth operations and full regulatory compliance. This strong foundation enables you to confidently establish and grow your business in Peru with efficiency and assurance.
WHY PERU?
Peru, officially the Republic of Peru, is a country in western South America. It is bordered to the north by Ecuador and Colombia, to the east by Brazil, to the southeast by Bolivia, to the south by Chile, and to the south and west by the Pacific Ocean. Peru is a megadiverse country, with habitats ranging from the arid plains of the Pacific coastal region in the west, to the peaks of the Andes mountains extending from the north to the southeast of the country, to the tropical Amazon basin rainforest in the east with the Amazon River. Peru has a population of over 32 million, and its capital and largest city is Lima. At 1,285,216 km2 (496,225 sq mi), Peru is the 19th largest country in the world, and the third largest in South America. Peru is a member of the Andean Community, the CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and the APEC (Asia-Pacific Economic Cooperation) forum. Peru currently has 23 trade agreements (including with the EU and the US), 4 to go into effect soon and 8 in negotiation, among others.
Peru is one of the most dynamic and steady economies in Latin America with a qualification of BBB by Fitch Ratings. Peru’s ‘BBB’ ratings are supported by moderate public debt, strong external liquidity, a track record of macroeconomic stability and a disciplined policy framework. Among the key factors for the decision to maintain Peru’s rating is the resilience that the Peruvian economy showed in the face of different adverse shocks. Peru represents the 6th largest nominal GDP in Latin America. The country underwent a structural improvement in the past 30 years, which included several trade agreements. It has a Gross Domestic Product (GDP) of US$ 242 billion. The government is committed to executing the National Sustainable Infrastructure Plan for Competitiveness to address infrastructure gaps and boost economic growth. This includes 44 projects under the Public-Private-Partnership (PPP) modality including the construction of Line 2 of the Lima Metro system and the largest port terminal in the region called Chancay Port, and the expansion of the main airport, among others total an investment of US$ 9.5 billion.
ADVANTAGES
Peru offers advantages like a stable economy, strategic Pacific location, investor-friendly policies (tax incentives, stability agreements), access to rich natural resources (mining, agriculture), a skilled yet young workforce, and numerous Free Trade Agreements (FTAs) for broad market access, making it a hub for investment in Latin America
Economic & Political Stability
- Stable Macroeconomy: Consistent GDP growth and relatively low inflation make it attractive for investors.
- Investor Protections: Legal stability agreements guarantee stable tax and administrative regimes for investors.
- Open Policies: A commitment to fiscal stability and attracting Foreign Direct Investment (FDI).
Market Access & Location
- Strategic Location: Pacific coast position facilitates trade with the Americas and Asia.
- Extensive FTAs: Agreements with the US, EU, China, and others provide broad market access.
- Large Consumer Base: A domestic market of over 30 million people.
Resources & Workforce
- Abundant Natural Resources: Rich in minerals (copper, gold, zinc) and key for agribusiness (asparagus, coffee) and fisheries.
- Skilled Labor: A young, increasingly skilled workforce, especially in mining, agriculture, and services.
Business Environment
- Favourable Regulations: Efficient business registration processes and low setup costs compared to the regional average.
- Tax Incentives: Special incentives for Research, Development, and Innovation (R&D+i) projects.
- Free Currency Movement: No exchange controls; free convertibility and remittance of foreign currency.
SIMPLE TAX REGIME
Corporate Income Tax (CIT)
Resident entities are taxed on their worldwide income, while non-residents pay tax only on Peruvian-source income.
- General Rate: 29.5% on net taxable income.
- Special Regimes:
- MYPE Tributario (RMT): For small and medium enterprises; taxes are 10% on the first 15 UIT of profit and 29.5% on the excess.
- Agricultural Sector: A specialized 15% rate applies from 2026 to 2035 for qualified companies.
- Withholding Taxes for Non-Residents:
- Dividends: 5%.
- Interest: 4.99% for qualifying loans, otherwise 30%.
- Royalties & Digital Services: 30%.
Technical Assistance: 15% (subject to documentation).
Personal Income Tax (PIT)
Residents are taxed on worldwide income, while non-residents pay a flat 30% on Peruvian-source employment income.
- Residency: Individuals who spend more than 183 days in Peru in a 12-month period become tax residents on January 1 of the following year.
- 2025 Progressive Tax Rates (for residents):
- 0 – 5 UIT: 8%
- 5 – 20 UIT: 14%
- 20 – 35 UIT: 17%
- 35 – 45 UIT: 20%
- Over 45 UIT: 30%
- Deductions: Residents are allowed an automatic deduction of 7 UIT from their work income.
Consumption and Indirect Taxes
- Value Added Tax (IGV): The general rate is 18% (16% VAT + 2% Municipal Promotion Tax).
- Temporary Reduced VAT: A rate of 8% applies to micro/small companies in the hotel and restaurant sectors for 2025 and 2026.
- Excise Tax (ISC): Applied at variable rates to specific luxury or harmful items such as alcohol, tobacco, fuel, and sugary drinks.
Other Key Business Taxes
- Temporary Net Asset Tax (ITAN): 0.4% on the value of net assets exceeding S/ 1,000,000.
- Financial Transactions Tax (ITF): 0.005% on all debits and credits in bank accounts within the Peruvian financial system.
- Mining Taxes: Metallic mining is subject to a sliding scale Royalty (1%–12%) and a Special Mining Tax (2%–8.4%).
International Compliance
- General Anti-Avoidance Rule (GAAR): SUNAT is empowered to recharacterize transactions lacking economic substance.
- Transfer Pricing: Peru follows OECD guidelines, requiring Local, Master, and Country-by-Country reports for entities meeting specific revenue thresholds.
- Multilateral Instrument (MLI): Peru ratified the OECD MLI in June 2025, which will begin modifying its tax treaties starting in 2026.
COMPANIES PERU
- Sociedad Anónima (S.A.) (Joint Stock Company): Most common for larger businesses, requires at least two shareholders, limited liability, managed by a Board and General Manager, capital in shares.
- Sociedad Anónima Cerrada (S.A.C.) (Private Closed Corporation): Popular for SMEs, 2-20 shareholders, no Board needed (just a GM), limited liability, often no min. capital.
- Sociedad Anónima Abierta (S.A.A.) (Publicly Held Corporation): For large public companies, can have many shareholders.
- Sociedad Comercial de Responsabilidad Limitada (S.R.L.): At least 2 members (individuals/companies), capital in “participations,” not shares; requires a manager.
Other Structures
- Empresa Individual de Responsabilidad Limitada (EIRL): For a single owner (natural person), capital comes from owner’s assets, owner has limited liability.
- Branch Office: A direct extension of a foreign company.
- Sole Proprietorship: A business run by one individual.
- Partnerships: General (Sociedad Colectiva) and Limited (Sociedad en Comandita).
- Sociedad Anónima Cerrada Simplificada (SACS): A simplified, faster online setup for S.A.C.s, with natural persons as shareholders.
- Sociedad de Beneficio e Interés Colectivo (BIC): A benefit corporation status added to existing structures (SA, SAC, SRL) focused on social/environmental goals.
Contact Us
Get in touch with the right people to get the right help in setting up your business in Peru.
enquiries@chandrawatpartners.com.