Countries › Peru › Guide › 11. Real estate and land › IGV on real estate in Peru: the builder's first sale, the 50 percent land exclusion, used property, leases by businesses and the 35 UIT housing exemption

IGV on real estate in Peru: the builder's first sale, the 50 percent land exclusion, used property, leases by businesses and the 35 UIT housing exemption

Last verified: 2026-10-28 · Status: Changing

Peru's 18 percent IGV (15.5 percent IGV plus 2.5 percent IPM in 2026) applies to the first sale of a building by its builder or a related company, but not to resales of used property by people without a business, nor to rents that are first or second category income. On a builder's first sale the land is excluded from the base, and the regulation fixes the land at 50 percent of the price, so the effective charge is 9 percent of the total. Leases by companies are taxable services, and an exemption for homes sold by their builder for no more than 35 UIT sits in Apéndice I, whose exemptions now run to 31 December 2028.

USD figures use S/ 3.452 per US dollar, the banking system selling rate published by the Superintendencia de Banca, Seguros y AFP for 27 October 2026, from the Banco Central de Reserva del Perú statistics series PD04640PD. UIT based amounts use the 2026 UIT of S/ 5,500 set by Decreto Supremo Nº 301-2025-EF, as cited in SUNAT Resolución de Superintendencia Nº 000016-2026/SUNAT. Conversions are for orientation only.

Key facts

IGV plus IPM on a builder's first sale of property	18 % of the building valueTUO IGV art. 1 d); Ley 32387, as of 2026-10-28 · in force
Share of the price deemed land and excluded from the IGV base	50 %Reglamento IGV art. 5 num. 9 (SUNAT Informe 026-2015), as of 2026-10-28 · in force
Effective IGV plus IPM on the total price of a builder's first sale	9 %TUO IGV art. 13 d); Reglamento art. 5 num. 9, as of 2026-10-28 · in force
IGV on rent received by individuals (first category income)	Not taxed textTUO IGV art. 2 a), as of 2026-10-28 · in force
Housing first sale exemption ceiling (35 UIT, 2026)	192500 PENTUO IGV Apéndice I letter b) (SUNAT Informe 026-2015), as of 2026-10-28 · in force
Expiry of the Apéndice I and II IGV exemptions	2028-12-31 dateTUO IGV art. 7 (Ley 32542), as of 2026-10-28 · in force

The rule

1. IGV applies to the first sale of real estate by its builder, and to a later sale by a company related to the builder when it bought the property directly from the builder or a related company, unless the price is shown to be equal to or above market value. A sale after a reorganization or transfer of businesses also counts as a first sale. A builder is anyone who habitually sells property built wholly by it, or wholly or partly by a third party for it.Texto Único Ordenado de la Ley del IGV e ISC, Decreto Supremo Nº 055-99-EF (published 15 April 1999), Art. 1 letter d) and art. 3 letter e), 1999-04-15 official text · verified 2026-10-28

2. Leases and other assignments of use of movable and immovable property are not subject to IGV when the income is first or second category income for income tax, and transfers of used goods by individuals or entities that do not carry on business are not taxed unless they are habitual. Leases that are third category (business) income are services subject to IGV.TUO Ley del IGV e ISC; art. 2 letter b) as amended by Decreto Legislativo Nº 950 (3 February 2004); art. 3 letter c) numeral 1 as amended by Decreto Legislativo Nº 1116 (7 July 2012), Art. 2 letters a) and b), art. 3 letter c) numeral 1, 2012-07-07 official text · verified 2026-10-28

3. On the first sale of property, the tax arises on the date the income is received, for the amount received, whether partial or total; the base is the income received excluding the part that corresponds to the land value.TUO Ley del IGV e ISC, Art. 4 letter f) and art. 13 letter d), 1999-04-15 official text · verified 2026-10-28

4. Under the IGV regulation, the land value is deemed to be 50 percent of the total transfer value of the property. To check whether a sale is within the housing exemption, however, the land is included in the sale value. The exemption in Apéndice I letter b) covers the first sale of property by its builder for a sale value not above 35 UIT, provided it is used exclusively as housing and the building licence application was admitted by the municipality.
Cost to do it: IGV plus IPM of 18 percent on half the price, 9 percent of the total. On a S/ 600,000 new apartment: S/ 54,000.00.
Example: S/ 600,000 x 50% = S/ 300,000 base; IGV 15.5% S/ 46,500.00 plus IPM 2.5% S/ 7,500.00 = S/ 54,000.00. / About US$15,643.11 on a US$173,812 apartment.SUNAT Informe Nº 026-2015-SUNAT/5D0000 (16 February 2015), applying art. 13 of the TUO Ley del IGV, art. 5 numeral 9 of its Reglamento (Decreto Supremo Nº 029-94-EF) and Apéndice I letter b), Informe 026-2015, análisis 1 and 2, 2015-02-16 official text · verified 2026-10-28

5. The exemptions in Apéndices I and II are in force until 31 December 2028. Taxpayers selling goods in Apéndice I may waive the exemption and pay the tax on all those operations.TUO Ley del IGV e ISC; art. 7 first paragraph as amended by Ley Nº 32542 (published 31 December 2025, in force 1 January 2026), Art. 5 and art. 7, 2025-12-31 official text · verified 2026-10-28 · changed: Ley Nº 32542 (31 December 2025, in force 1 January 2026) extended the Apéndice I and II exemptions to 31 December 2028.

6. The combined rate stays at 18 percent while it shifts between the two taxes: IGV 15.5 percent and IPM 2.5 percent in 2026, 15 and 3 in 2027, 14.5 and 3.5 in 2028, and 14 and 4 from 2029.Ley Nº 32387 (16 June 2025), amending art. 17 of the TUO Ley del IGV and art. 76 of the Ley de Tributación Municipal, Art. 2; third complementary amending provision; fourth final complementary provision, 2025-06-16 official text · verified 2026-10-28 · changed: Ley Nº 32387 moves 0.5 points a year from IGV to IPM from 1 January 2026 to 2029; the combined 18 percent does not change.

Deal	IGV?	Base	Rule
Developer sells a new apartment for S/ 600,000 plus tax	Yes, 18%	S/ 300,000 (50% land excluded); tax S/ 54,000.00, US$15,643.11	Art. 1 d), 13 d)
Individual resells a used apartment	No, unless habitual	None	Art. 2 b)
Individual rents out an apartment	No	None (income tax only)	Art. 2 a)
Company rents out offices	Yes, 18%	Rent	Art. 3 c) 1
Builder sells a home for no more than 35 UIT (S/ 192,500), housing only, licence application admitted	Exempt, Apéndice I letter b)	None	Art. 5, 7; Informe 026-2015

IGV on property deals, 2026 (USD at S/ 3.452)

Worked example

A foreign buyer agrees a S/ 600,000 price plus IGV for a new Lima apartment. The developer charges IGV on S/ 300,000: S/ 46,500.00 IGV and S/ 7,500.00 IPM, total S/ 54,000.00 (US$15,643.11), so the buyer pays S/ 654,000.00. The buyer also pays alcabala, but only on the land value, because the builder's first sale is outside alcabala for the building part.
If the same apartment is bought from a private owner who used it, there is no IGV, and alcabala applies to the whole value above 10 UIT.

Step by step

Ask the developer whether the price includes IGV and how the invoice splits land and building.
Remember that IGV arises on each payment received, including deposits for off plan units, so each instalment comes with an invoice.
Business landlords add IGV to rent and can use input IGV on their costs; individuals renting out property do not charge IGV.

Common traps

Buying from a company related to the builder can still be a taxed first sale unless the price is at or above market value.
The 35 UIT housing threshold includes the land value, even though the land is excluded when computing the tax.
The housing exemption depends on the Apéndice I list; its validity is now to 31 December 2028, so check the list in force at the date of each payment.

Sources

← Property tax (impuesto predial) and municipal service fees (arbitrios) in Peru: rates, assessed value, filing and payment dates, exemptions and the pensioner deductionTax on selling property in Peru: 5 percent on residents' and non resident individuals' gains, 30 percent for foreign companies, the home and pre 2004 exemptions, habitual sellers and payment before the deed →

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