Understanding Uruguay IVA Nexus Rules

Updated 3 months ago

Nexus determines when your business has a tax obligation in Uruguay. Kintsugi monitors three types of nexus for Uruguay: physical nexus, economic nexus, and collected tax nexus.

Physical Nexus

Your business has physical nexus in Uruguay when it has a tangible presence there. IVA registration is required from the start of business activity for most physical presence categories.

Physical Presence Type	Triggers IVA Registration?
Uruguayan incorporated company	Yes
Branch, office, or fixed establishment	Yes
Employees permanently based in Uruguay with sales authority	Yes
Warehouse or storage facility	Yes
Retail store or physical location	Yes
Manufacturing or production facility	Yes
Active servers or technical equipment used in revenue-generating activities	Yes
Trade show participation with sales	Yes
Consignment stock at customer premises	Yes
Drop shipping to Uruguayan customers	Yes
Service center or customer support office	Yes
Remote employees with no sales authority	No
Passive servers used only for data storage	No
Trade show participation with no sales	No
Representative office for preparatory or auxiliary activities only	No

Economic Nexus

Uruguay's economic nexus rules have been in effect since January 1, 2018.

Business Type	Threshold	Trigger
Uruguay-based (resident)	UYU 0	First taxable supply triggers registration
Non-resident (remote seller)	UYU 0	First B2C taxable supply triggers exposure

There is no monetary threshold. Registration is mandatory before you make your first taxable sale, regardless of volume.

What Counts Toward the Threshold?

For resident businesses, B2B domestic sales, zero-rated sales (e.g., exports), and marketplace sales all count. For non-resident businesses, B2C sales count, but B2B sales do not if all sales are B2B only.

Collected Tax Nexus

If your business collected IVA in Uruguay without meeting physical or economic nexus first, you still establish a collected tax nexus obligation. This works similarly to how collected tax nexus operates in the United States.

Local Agent Requirement

Non-resident businesses registering for IVA in Uruguay are required to appoint a local representative (domestic partner). This representative is responsible for certain compliance obligations on your behalf.

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