Countries › Peru › Guide › 5. FX and capital controls › Dividends and profit repatriation from Peru: the 5 percent withholding, what counts as a dividend, branches and treaty interplay
Dividends and profit repatriation from Peru: the 5 percent withholding, what counts as a dividend, branches and treaty interplay
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Last verified: 2026-10-28 · Status: Stable
A Peruvian company may distribute all of its profits and the foreign shareholder may send them abroad in any currency without authorization; the State cannot restrict distributions beyond the legal reserve and tax rules. The only toll is a 5 percent withholding on dividends paid to non domiciled companies and individuals, which the paying company withholds and pays to SUNAT in its monthly return; profits earned in 2015 and 2016 still carry 6.8 percent and are presumed to be distributed first. Branches are deemed to distribute their profits on the annual return due date, and loans to shareholders, capital reductions from profits and other disguised distributions also count as dividends.
USD figures use S/ 3.446 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 26 October 2026 as shown in the Banco Central de Reserva del Perú statistics series PD04640PD. Amounts that the law sets in US dollars or soles are quoted as written. Conversions are for orientation only.
Key facts
| Withholding on dividends paid to non domiciled legal entities | 5 %LIR art. 56 e), as of 2026-10-28 · in force |
|---|---|
| Withholding on dividends paid to non domiciled individuals | 5 %LIR art. 54 a), as of 2026-10-28 · in force |
| Rate on distributions of profits earned in 2015 and 2016 | 6.8 %DL 1261 third complementary final provision, as of 2026-10-28 · in force |
| Tax on branch profits deemed distributed on the annual return due date | 5 %LIR art. 56 e) second paragraph, as of 2026-10-28 · in force |
| Remittance of dividends and net profits abroad | Free, in freely convertible currency, without prior authorization, after taxes textDS 162-92-EF art. 10, 11 and 15 b), as of 2026-10-28 · in force |
| Deadline to pay dividend withholding to SUNAT | Monthly return of the period in which the dividend is agreed or made available textLIR art. 73-A and 76, as of 2026-10-28 · in force |
The rule
1. Companies have the right to agree freely to distribute all of the profits or dividends they generate, and the State may not restrict that distribution as long as legal obligations are met, including interim distributions of the current year based on periodic balance sheets. The right does not exempt the company from declaring and paying income tax, from the mandatory legal reserve of stock corporations, from the reserves of banks and insurers, or from directors' liability for distributing profits not actually earned. Investors have the right to receive the whole of the profits or dividends attributed to them.
Cost to do it: No fee or permit to distribute. The cost is the 5 percent withholding below.
Example: A Peruvian S.A.C. with S/ 344,600 of distributable profit may resolve to pay it all to its foreign parent, including an interim dividend based on a mid year balance sheet. / US$100,000 of profit can be declared and paid out in full; no regulator sets a payout ceiling.Decreto Supremo Nº 162-92-EF (regulation of the investment guarantee regimes), dated 9 October 1992, Art. 10 and art. 11, 1992-10-09 official text · verified 2026-10-28
Cost to do it: No fee or permit to distribute. The cost is the 5 percent withholding below.
Example: A Peruvian S.A.C. with S/ 344,600 of distributable profit may resolve to pay it all to its foreign parent, including an interim dividend based on a mid year balance sheet. / US$100,000 of profit can be declared and paid out in full; no regulator sets a payout ceiling.Decreto Supremo Nº 162-92-EF (regulation of the investment guarantee regimes), dated 9 October 1992, Art. 10 and art. 11, 1992-10-09 official text · verified 2026-10-28
2. The income tax on non domiciled legal entities is 5 percent on dividends and other distributions of profits, and the same 5 percent applies to non domiciled individuals on dividends (other than distributions covered by art. 10 f) of the law). The rate was set by Decreto Legislativo Nº 1261 and applies to distributions agreed or made available, in cash or in kind, whichever comes first, from 1 January 2017.
Cost to do it: 5 percent of the gross dividend.
Example: A dividend of S/ 344,600 bears S/ 17,230 of withholding; the parent receives S/ 327,370. / US$100,000 of dividends: US$5,000 withheld, US$95,000 remitted.Texto Único Ordenado de la Ley del Impuesto a la Renta (Decreto Supremo Nº 179-2004-EF); rates set by Decreto Legislativo Nº 1261 (published 10 December 2016, in force 1 January 2017); art. 56 e) heading reworded by Decreto Legislativo Nº 1541 (published 26 March 2022, in force 1 January 2023), Art. 54 a) and art. 56 e); DL 1261 third complementary final provision, 2016-12-10 official text · verified 2026-10-28
Cost to do it: 5 percent of the gross dividend.
Example: A dividend of S/ 344,600 bears S/ 17,230 of withholding; the parent receives S/ 327,370. / US$100,000 of dividends: US$5,000 withheld, US$95,000 remitted.Texto Único Ordenado de la Ley del Impuesto a la Renta (Decreto Supremo Nº 179-2004-EF); rates set by Decreto Legislativo Nº 1261 (published 10 December 2016, in force 1 January 2017); art. 56 e) heading reworded by Decreto Legislativo Nº 1541 (published 26 March 2022, in force 1 January 2023), Art. 54 a) and art. 56 e); DL 1261 third complementary final provision, 2016-12-10 official text · verified 2026-10-28
3. Retained earnings obtained between 1 January 2015 and 31 December 2016 that form part of a distribution are taxed at 6.8 percent (4.1 percent for the indirect distributions of art. 24-A g)). For this purpose the law presumes, without admitting proof to the contrary, that each distribution comes from the oldest accumulated results first.
Cost to do it: 6.8 percent on the part of the dividend that comes from 2015 and 2016 profits, instead of 5 percent.
Example: A company with S/ 100,000 of 2016 profits still undistributed and S/ 244,600 of 2025 profits pays S/ 344,600: S/ 6,800 is withheld on the first S/ 100,000 and S/ 12,230 on the rest, S/ 19,030 in total. / On US$100,000 the withholding is about US$5,522 instead of US$5,000 because the oldest (2016) profits are presumed to go out first.Decreto Legislativo Nº 1261, Third and fourth complementary final provisions, 2016-12-10 official text · verified 2026-10-28
Cost to do it: 6.8 percent on the part of the dividend that comes from 2015 and 2016 profits, instead of 5 percent.
Example: A company with S/ 100,000 of 2016 profits still undistributed and S/ 244,600 of 2025 profits pays S/ 344,600: S/ 6,800 is withheld on the first S/ 100,000 and S/ 12,230 on the rest, S/ 19,030 in total. / On US$100,000 the withholding is about US$5,522 instead of US$5,000 because the oldest (2016) profits are presumed to go out first.Decreto Legislativo Nº 1261, Third and fourth complementary final provisions, 2016-12-10 official text · verified 2026-10-28
4. The company that agrees a dividend or other distribution withholds 5 percent, except when the shareholder is a domiciled legal entity; later redistributions by a Peruvian holding company are not subject to withholding unless they go to non domiciled persons or to domiciled individuals. Withholding also applies to dividends to the depositary bank of ADRs and GDRs. For distributions in kind, the company pays the 5 percent and the shareholder must reimburse it. Anyone paying or crediting Peruvian source income to non domiciled beneficiaries must withhold and pay the tax to SUNAT, as a final tax, within the Tax Code deadlines for monthly obligations.
Cost to do it: No fee; the company declares and pays the withholding in its monthly return by the due date in SUNAT's monthly calendar.
Example: Dividend agreed on 15 March 2026: the S/ 17,230 withheld from a S/ 344,600 dividend is paid to SUNAT in the return for the March 2026 period, due in April under the monthly calendar. / US$5,000 of withholding on a US$100,000 dividend is due in the following month's return.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 73-A replaced by Decreto Legislativo Nº 1261 (published 10 December 2016, in force 1 January 2017), Art. 73-A and art. 76, 2016-12-10 official text · verified 2026-10-28
Cost to do it: No fee; the company declares and pays the withholding in its monthly return by the due date in SUNAT's monthly calendar.
Example: Dividend agreed on 15 March 2026: the S/ 17,230 withheld from a S/ 344,600 dividend is paid to SUNAT in the return for the March 2026 period, due in April under the monthly calendar. / US$5,000 of withholding on a US$100,000 dividend is due in the following month's return.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 73-A replaced by Decreto Legislativo Nº 1261 (published 10 December 2016, in force 1 January 2017), Art. 73-A and art. 76, 2016-12-10 official text · verified 2026-10-28
5. For tax purposes a dividend includes much more than a declared dividend: profits distributed in cash or in kind (other than in the company's own shares); distributions of revaluation surpluses; capital reductions up to capitalized or existing profits, surpluses, premiums or free reserves; the excess received on a capital reduction or liquidation over nominal value plus premiums; any loan a company (other than banks and leasing firms) grants to its shareholders, up to its profits and free reserves; any amount that is an indirect disposal of taxable income not subject to later tax control, including expenses charged and income not declared; and the pay of shareholders, owners and their relatives above market value. Distributions in kind are measured at market value, and dividends received by one Peruvian company from another are not part of its taxable income.
Cost to do it: 5 percent withholding on the amount recharacterized as a dividend, plus interest and penalties if it was not withheld on time.
Example: A Peruvian subsidiary with S/ 2,000,000 of retained earnings lends S/ 689,200 to its foreign parent: the whole loan is a dividend, with S/ 34,460 to withhold. / A US$200,000 upstream loan from a profitable subsidiary is a US$200,000 dividend for tax purposes, with US$10,000 of withholding.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 24-A incorporated by Ley Nº 27804 (published 2 August 2002), literal f) as amended by Ley Nº 30296 (published 31 December 2014, in force 1 January 2015), Art. 24-A a) to h) and art. 24-B, 2014-12-31 official text · verified 2026-10-28
Cost to do it: 5 percent withholding on the amount recharacterized as a dividend, plus interest and penalties if it was not withheld on time.
Example: A Peruvian subsidiary with S/ 2,000,000 of retained earnings lends S/ 689,200 to its foreign parent: the whole loan is a dividend, with S/ 34,460 to withhold. / A US$200,000 upstream loan from a profitable subsidiary is a US$200,000 dividend for tax purposes, with US$10,000 of withholding.Texto Único Ordenado de la Ley del Impuesto a la Renta; art. 24-A incorporated by Ley Nº 27804 (published 2 August 2002), literal f) as amended by Ley Nº 30296 (published 31 December 2014, in force 1 January 2015), Art. 24-A a) to h) and art. 24-B, 2014-12-31 official text · verified 2026-10-28
6. For branches and other permanent establishments in Peru of foreign companies and entities, profits are deemed distributed on the due date of the annual income tax return, and the amount distributed is the income available to the foreign head office: the branch's net income plus exempt interest, dividends received and other available amounts, less the income tax paid. The 5 percent therefore applies each year whether or not cash is sent.
Cost to do it: 5 percent of the branch's available income each year.
Example: A branch with net income of S/ 1,000,000 that pays S/ 295,000 of corporate income tax (29.5 percent) is deemed to remit S/ 705,000 on the return due date, owing S/ 35,250. / On US$290,192 of branch net income, about US$10,229 of dividend tax is due even if the profit stays in Peru.Texto Único Ordenado de la Ley del Impuesto a la Renta; second paragraph of art. 56 e) as amended by Decreto Legislativo Nº 1424 (published 13 September 2018, in force 1 January 2019), Art. 56 e), second paragraph, 2018-09-13 official text · verified 2026-10-28
Cost to do it: 5 percent of the branch's available income each year.
Example: A branch with net income of S/ 1,000,000 that pays S/ 295,000 of corporate income tax (29.5 percent) is deemed to remit S/ 705,000 on the return due date, owing S/ 35,250. / On US$290,192 of branch net income, about US$10,229 of dividend tax is due even if the profit stays in Peru.Texto Único Ordenado de la Ley del Impuesto a la Renta; second paragraph of art. 56 e) as amended by Decreto Legislativo Nº 1424 (published 13 September 2018, in force 1 January 2019), Art. 56 e), second paragraph, 2018-09-13 official text · verified 2026-10-28
7. Peru's tax treaties allow the source state to tax dividends at up to 10 percent for qualifying corporate shareholders and 15 percent in other cases (Chile and Mexico 10 percent for a company holding at least 25 percent, Canada 10 percent for a company controlling at least 10 percent of the voting shares, Switzerland and Portugal 10 percent with a 10 percent holding; South Korea 10 percent in all cases). Because Peru's domestic rate of 5 percent is lower than these caps, the domestic 5 percent is what applies, and treaties matter mainly for the tax credit in the shareholder's country. Peru has no income tax treaty with Argentina.
Cost to do it: No cost; a certificate of residence is only needed when a treaty rate below the domestic rate is claimed, which does not happen with dividends.
Example: A Chilean parent receiving S/ 344,600 still bears S/ 17,230 (5 percent), not the treaty cap of 10 percent. / On US$100,000 the treaty would allow up to US$10,000, but Peru only takes US$5,000.Convenio Perú y Chile para evitar la doble tributación (ratified by Decreto Supremo Nº 005-2003-RE, published 17 January 2003, applicable from 1 January 2004) and the other treaties listed, per SUNAT Informe Nº 0055-2021-SUNAT/7T0000, Art. 10 of each treaty, 2003-01-17 official text · verified 2026-10-28
Cost to do it: No cost; a certificate of residence is only needed when a treaty rate below the domestic rate is claimed, which does not happen with dividends.
Example: A Chilean parent receiving S/ 344,600 still bears S/ 17,230 (5 percent), not the treaty cap of 10 percent. / On US$100,000 the treaty would allow up to US$10,000, but Peru only takes US$5,000.Convenio Perú y Chile para evitar la doble tributación (ratified by Decreto Supremo Nº 005-2003-RE, published 17 January 2003, applicable from 1 January 2004) and the other treaties listed, per SUNAT Informe Nº 0055-2021-SUNAT/7T0000, Art. 10 of each treaty, 2003-01-17 official text · verified 2026-10-28
| Profits distributed | Rate | Withholding US$ | Net US$ | Withholding S/ | ITF on debit S/ |
|---|---|---|---|---|---|
| Earned 2017 onward | 5% | 5,000 | 95,000 | 17,230 | 17.23 |
| Earned 2015 and 2016 | 6.8% | 6,800 | 93,200 | 23,433 | 17.23 |
| Branch profit deemed distributed | 5% | 5,000 | 95,000 (no cash need move) | 17,230 | None if not remitted |
US$100,000 of dividends from a Peruvian company to a foreign parent, by origin of the profits. Soles at S/ 3.446 per US dollar (26 October 2026). ITF of 0.005 percent on the bank debit. Illustration only.
| Treaty partner | Cap, qualifying corporate holder | Cap, other cases | Rate Peru actually applies |
|---|---|---|---|
| Chile | 10% | 15% | 5% |
| Canada | 10% | 15% | 5% |
| Mexico | 10% | 15% | 5% |
| Switzerland | 10% | 15% | 5% |
| Portugal | 10% | 15% | 5% |
| South Korea | 10% | 10% | 5% |
Dividend caps in six Peruvian tax treaties (art. 10) against the 5 percent domestic rate, from the treaty texts on the MEF site.
Worked example
- A Peruvian S.A.C. owned 100 percent by a Canadian company closes 2025 with S/ 1,000,000 of net profit after tax. The general meeting in March 2026 sets aside the legal reserve and declares a dividend of S/ 344,600 (US$100,000). The company withholds S/ 17,230, pays it to SUNAT in its March return, buys US$95,000 at its bank and wires them to Canada. No central bank form, permit or exchange quota is involved.
- If the same subsidiary instead lent US$100,000 to the parent while holding retained earnings, SUNAT treats the loan as a US$100,000 dividend under art. 24-A f), so the 5 percent is due anyway, with interest if it was not withheld on time.
- Argentina and Peru: Peru has no income tax treaty with Argentina, so a dividend from Peru to an Argentine parent bears Peru's 5 percent and Argentina's own rules on foreign dividends and FX inflows, covered in The Argentine Thread guide.
Step by step
- Close the year and approve the financial statements; allocate the legal reserve where the companies law requires it.
- Identify the year in which the distributed profits were earned; distributions are presumed to come from the oldest results first, so clear 2015 and 2016 balances will carry 6.8 percent.
- Hold the shareholders' meeting and record the dividend resolution; the withholding duty arises when the dividend is agreed or made available, whichever comes first.
- Withhold 5 percent (or 6.8 percent on 2015 and 2016 profits) and pay it to SUNAT in the monthly return for that period.
- Convert at the bank offering the best rate and wire the net amount; keep the resolution, withholding receipt and bank advice for the shareholder's foreign tax credit.
- For a branch, compute the available income at the annual return due date and pay the 5 percent then, whether or not funds are remitted.
Common traps
- Upstream loans: any loan from a Peruvian company to its shareholders, up to its retained earnings and free reserves, is a dividend under art. 24-A f), including intra group cash pooling with the parent.
- Old profits first: the presumption that the oldest results are distributed first means 2015 and 2016 profits carry 6.8 percent until they are exhausted.
- Branches cannot defer: the deemed distribution happens on the annual return due date every year.
- Transfer pricing or audit adjustments that reveal income disposed of without tax control can be treated as indirect dividends under art. 24-A g).
- Interim dividends are allowed, but directors are liable if the profits were not really earned or capital has been lost.
Sources
- Decreto Supremo Nº 162-92-EF, regulation of the investment guarantee regimes (MEF)
- Ley del Impuesto a la Renta, chapter VII, art. 54 to 56 (SUNAT)
- Decreto Legislativo Nº 1261, El Peruano 10 December 2016 (Congress archive)
- Ley del Impuesto a la Renta, chapter X, art. 73-A and 76 (SUNAT)
- Ley del Impuesto a la Renta, chapter V, art. 24-A and 24-B (SUNAT)
- Peru and Chile tax treaty text (MEF)
- Peru and Canada tax treaty text (MEF)
- Peru and Mexico tax treaty text (MEF)
- Peru and Switzerland tax treaty text (MEF)
- Peru and Portugal tax treaty text (MEF)
- Peru and South Korea tax treaty text (MEF)
- SUNAT Informe Nº 0055-2021-SUNAT/7T0000 (legal basis and dates of Peru's tax treaties)
- Argentina, double taxation treaties in force (argentina.gob.ar)
- BCRP statistics, SBS banking system selling rate series PD04640PD
Related pages
- fx/fx-and-capital-controls
- fx/capital-contributions-and-repatriation
- fx/foreign-loans
- taxes/withholding-on-remittances
- taxes/tax-treaties
- taxes/corporate-income-tax
- entities/branch-of-a-foreign-company
- exiting/exiting-peru
- /country/peru/
- /calendar/
- Live dashboard
- https://theargentinethread.com/guide/
Related: Peru country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide
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