Countries › Uruguay › Guide › 3. Investing › Promoted housing in Uruguay (vivienda promovida, Ley Nº 18.795): tax exemptions for developers and for investors who buy to rent

Promoted housing in Uruguay (vivienda promovida, Ley Nº 18.795): tax exemptions for developers and for investors who buy to rent

Last verified: 2026-10-27 · Status: Stable

Uruguay's promoted housing regime gives developers of qualifying housing projects (new builds of at least two units of 35 to 125 square metres, or 25 to 40 for studios, in serviced urban areas) exemption from IRAE on the first sale, VAT exemption with refund of input VAT, transfer tax exemption for both parties on the first sale and wealth tax relief during construction. Investors who buy promoted units to rent, including nonresidents, are exempt on 60 or 100 percent of the rent for the year the works end and the next nine years, and from wealth tax in years the unit is let for at least six months. Applications go to the Agencia Nacional de Vivienda, the CAIVIS advises within 20 business days, and breaches can cost the benefits and fines of up to UI 1.3 million.

USD figures use UYU 40.210 per US dollar, the Banco Central del Uruguay quotation for DLS. USA BILLETE on 27 October 2026, and the Unidad Indexada (UI) at UYU 6.6792 for 27 October 2026, both retrieved from the BCU quotations service on the verification date. Amounts the law sets in UI or pesos are quoted as written; conversions are for orientation only.

Key facts

Promoted housing: minimum habitable area (non studio)	35 m2Decreto Nº 355/011 art. 5, as of 2026-10-27 · in force
Promoted housing: maximum habitable area	125 m2Decreto Nº 355/011 art. 5, as of 2026-10-27 · in force
Promoted new build: minimum number of units	2 unitsDecreto Nº 355/011 art. 8, as of 2026-10-27 · in force
Rental income exemption period (completion year plus nine)	10 fiscal yearsDecreto Nº 355/011 art. 12, as of 2026-10-27 · in force
Share of rent exempt outside priority zones and guarantee schemes	60 %Decreto Nº 355/011 art. 12, as of 2026-10-27 · in force
Share of rent exempt in priority zones or with the rent guarantee	100 %Decreto Nº 355/011 art. 12, as of 2026-10-27 · in force
Minimum lease term for rental benefits	12 monthsDecreto Nº 355/011 art. 12, as of 2026-10-27 · in force
CAIVIS term to advise (silence is favourable)	20 business daysDecreto Nº 355/011 art. 3 and 4, as of 2026-10-27 · in force
Maximum fine for breaches	1300000 UILey Nº 18.795 art. 6 (Ley Nº 19.355 art. 496), as of 2026-10-27 · in force
BCU quotation, DLS. USA BILLETE	40.21 UYU per USDBanco Central del Uruguay quotation, as of 2026-10-27 · in force
Unidad Indexada (UI) value	6.6792 UYUBanco Central del Uruguay quotation, as of 2026-10-27 · in force

The rule

1. Improving access to social interest housing is of national interest. The Executive may declare promoted investment projects to build, refurbish, extend or recycle housing for sale, rent or rent with purchase option, including purchases of promoted units for later rental, and projects of social funds and housing cooperatives.Ley Nº 18.795 (Promotion of Social Interest Housing), Art. 1 and art. 2, 2011-08-17 official text · verified 2026-10-27

2. The Executive may grant promoted projects: exemption of income taxes on the promoted income; full IRAE deduction of the land cost; Impuesto al Patrimonio exemption on the promoted properties; and VAT exemption on the sale, construction, refurbishment, extension and recycling of the homes, with a credit for VAT on inputs. A Comisión Asesora de Inversiones en Vivienda de Interés Social (CAIVIS) advises on the promotion, with the Agencia Nacional de Vivienda (ANV) as technical adviser.Ley Nº 18.795, Art. 4 and art. 5, 2011-08-17 official text · verified 2026-10-27

3. The developer files with the ANV: request, works budget and schedule, architectural draft, location plan, a sworn commitment letter, the technical aptitude document or registry certificate issued by the housing ministry where required, and RUT registration showing construction under Ley Nº 18.795 as the sole business (unless the land was bought before the decree). The ANV evaluates and sends its opinion to the CAIVIS, which has 20 business days to advise the Executive; the term is suspended while information is requested (the applicant has 20 business days to answer or is deemed to withdraw). If the CAIVIS does not advise in time it is deemed to recommend promotion.
Cost to do it: The decree sets no application fee; the cost is in preparing the project documents.Decreto Nº 355/011 (regulation), art. 1, art. 2 (as worded by Decreto Nº 156/014 and Decreto Nº 59/022), art. 3 (as worded by Decreto Nº 156/014) and art. 4, Art. 1 to art. 4, 2014-05-30 official text · verified 2026-10-27

4. Promoted units must have habitable areas of 35 to 125 square metres according to the number of bedrooms, or 25 to 40 square metres for one room units that meet departmental rules, and be in urban areas with installed infrastructure; projects in areas where seasonal homes predominate are not promoted. The housing ministry with the Ministry of Economy may set architectural requirements, zones, and maximum prices and sale conditions by zone. Projects must build at least 2 units, recycle with at least one additional unit, or refurbish or extend at least 2 units, with refurbishments of at least UI 100,000 per unit; refurbishments and extensions must add 25 percent of floor area, 50 percent of market value or more units. Projects financed by the National Housing Fund are excluded.
Example: Minimum refurbishment investment UI 100,000 per unit is UYU 667,920. / About US$16,611 per unit.Decreto Nº 355/011, art. 5 and art. 8 (as worded by Decreto Nº 129/020), art. 6 and art. 7 (as worded by Decreto Nº 34/017) and art. 9, Art. 5 to art. 9, 2020-04-16 official text · verified 2026-10-27 · changed: Decreto Nº 129/020 of 16 April 2020 reworded art. 5 (unit sizes and location) and art. 8 (minimum investment) and extended the rental exemptions to all promoted units let from its entry into force.

5. Promoted construction, recycling, refurbishment or extension projects get: IRAE exemption on income from the first sale of the units if sold within nine years after the year the works end; Impuesto al Patrimonio exemption on works in progress (land and improvements) until completion, and on finished units for sale in the completion year and the next three; VAT exemption on the first sale and refund of VAT on local purchases of goods and services forming the direct cost, for invoices up to two years after the works close, paid by DGI credit certificates as for exporters; VAT exemption on imports of goods for the works; and Impuesto a las Trasmisiones Patrimoniales exemption for seller and buyer on the first sale within nine years after completion. If the developer rents the units, IRAE is exempt on 100 percent of the rent in zones the ministries designate or when let through the rent guarantee fund or an equivalent guarantee, and on 60 percent in other designated zones, for the completion year and nine more.Decreto Nº 355/011, art. 10, Art. 10, 2020-04-16 official text · verified 2026-10-27

6. Buyers who acquire promoted units to rent are exempt, for the completion year and the next nine, from IRAE, IRPF and IRNR on 100 percent of the rent in zones the ministries designate or when the rent is through the rent guarantee fund or an equivalent guarantee, and on 60 percent in the other cases. They are exempt from Impuesto al Patrimonio on the units in the completion year and, for the next nine years, in each year the unit was let for at least six months. Rental benefits apply only to permanent homes with leases of 12 months or more. Exempt IRPF rents do not count toward the IRPF limits of Title 7 art. 27 literal j. From Decreto Nº 129/020 these rental rules apply to all promoted units let, whatever rule applied when they were promoted.
Example: Illustration only: a nonresident lets a promoted flat in a 60 percent zone for UYU 30,000 a month. Of UYU 360,000 a year, UYU 216,000 is exempt and IRNR at 12 percent applies to the rest under the general rules for rent. / About US$8,953 of annual rent, US$5,372 exempt.Decreto Nº 355/011, art. 12 as worded by Decreto Nº 129/020 art. 4 (literal a, inciso 3 added by Decreto Nº 283/021), Art. 12, 2021-08-27 official text · verified 2026-10-27

7. Promoted benefits cannot be combined with other promotional tax benefits, except the parking promotion of Decreto Nº 110/016. Exempt income and transfer taxes are not withheld when the beneficiary shows the CAIVIS certificate; partial exemptions are withheld on the non exempt part. Sale deeds must state that the sale is made under Ley Nº 18.795.Decreto Nº 355/011, art. 14 (as worded by Decreto Nº 34/017), art. 15 (as worded by Decreto Nº 340/020) and art. 25, Art. 14, art. 15 and art. 25, 2020-12-14 official text · verified 2026-10-27

8. The developer must file the approved building permit with the ANV within 120 calendar days of notice of the promotion and start works within 270 calendar days of filing it, or may be deemed to withdraw. Works must follow the schedule with a 50 percent tolerance; the CAIVIS grants extensions if the original draft is kept, and the Executive may revoke the promotion if works are not finished. The beneficiary must provide information, build as approved, sell at or below any maximum price and rent through the guarantee fund when required.Decreto Nº 355/011, art. 16 (Decreto Nº 156/014), art. 17 and art. 19 (Decreto Nº 34/017), Art. 16, art. 17 and art. 19, 2017-02-06 official text · verified 2026-10-27

9. The Executive must require guarantees of compliance. On breach it may reassess the taxes with fines and surcharges, impose fines from UI 2,600 to UI 1,300,000, order partial loss of benefits or revoke the promotion. The regulation grades fines from UI 2,600 to UI 26,500 for minor breaches and UI 26,500 to UI 1,300,000 for serious ones.
Cost to do it: Fines from UI 2,600 (UYU 17,366, about US$432) to UI 1,300,000 (UYU 8,682,960, about US$215,940); minor breaches up to UI 26,500 (UYU 176,999).Ley Nº 18.795, art. 6 as worded by Ley Nº 19.355 art. 496; Decreto Nº 355/011 art. 20, Ley art. 6; Decreto art. 20, 2015-12-19 official text · verified 2026-10-27

10. The ANV manages a Guarantee Fund that may give partial guarantees on mortgage loans to individuals to buy, refurbish, build or extend a social interest home, on loans to buy land for a sole home, and on housing leasing with purchase option. Transfers of property arising from enforcement of mortgages guaranteed by the Fund are exempt from transfer tax.Ley Nº 18.795, art. 7 as worded by Ley Nº 20.446 art. 436; art. 15, Art. 7 and art. 15, 2025-12-16 official text · verified 2026-10-27 · changed: Ley Nº 20.446 of 16 December 2025, in force 1 January 2026, reworded art. 7 to add guarantees for land purchases and housing leasing.

Tax	Developer selling	Developer renting	Buyer who rents	Source
IRAE, IRPF or IRNR	First sale exempt (within 9 years of completion)	100 or 60 percent of rent, 10 years	100 or 60 percent of rent, 10 years	Art. 10 and 12
VAT	First sale exempt and input VAT refunded	Input VAT refunded on construction	Not applicable	Art. 10
Transfer tax (ITP)	Exempt for seller and buyer on first sale	Not applicable	Exempt on the first purchase	Art. 10 f
Impuesto al Patrimonio	Works in progress; finished units for 4 years	Completion year, then years let 6 months or more	Completion year, then years let 6 months or more	Art. 10 and 12

Who gets what under promoted housing (Decreto Nº 355/011)

Worked example

A foreign investor buys a new promoted two bedroom flat from a developer within nine years of completion. Neither party pays the transfer tax on that first sale and the price carries no VAT (Decreto Nº 355/011 art. 10). The investor lets it for UYU 30,000 a month on a 12 month lease: in a zone with 60 percent exemption, UYU 216,000 of the UYU 360,000 annual rent (about US$5,372 of US$8,953) is exempt from IRNR for the completion year and nine more, rising to 100 percent if the lease is through the rent guarantee fund or in a priority zone (art. 12). Each year it is let for at least six months, the flat is also free of wealth tax.

Step by step

1. Developer: check the site is urban with infrastructure and outside seasonal home areas, and design units within 35 to 125 square metres (Decreto Nº 355/011 art. 5).
2. Register in the RUT with construction under Ley Nº 18.795 as the sole business and file the project with the ANV (art. 2).
3. Await the CAIVIS advice within 20 business days and the Executive's promotion (art. 3 and 4).
4. File the building permit within 120 days and start works within 270 days of filing it (art. 17).
5. Claim VAT refunds through DGI credit certificates for invoices up to two years after completion (art. 10).
6. Buyer: obtain the CAIVIS certificate so no tax is withheld on exempt amounts, sign leases of 12 months or more, and file the information the ANV requests (art. 12, 15 and 16).

Common traps

Rental exemptions only apply to permanent homes on leases of at least 12 months; short stay rentals do not qualify (Decreto Nº 355/011 art. 12).
The wealth tax exemption after the completion year is lost in any year the unit was let for less than six months (art. 12).
The transfer tax and IRAE exemptions on sale apply only to the first sale within nine years after completion (art. 10).
The regime cannot be stacked with COMAP or other promotional benefits, except the parking promotion (art. 14).
Missing the 120 day permit or 270 day start deadlines can mean the project is treated as withdrawn (art. 17).

Sources

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