Argentina is a large country in South America known for its rich culture, diverse landscapes, and significant history. It is the second largest country in the continent, home to varied geography from the Andes mountains to the Pampas plains and Patagonian steppes.
Argentina gained independence from Spain in 1816 and has experienced periods of political and economic instability, including a military dictatorship from 1976 to 1983. Today, it is a federal republic with a representative democracy. The Federal Administration of Public Revenues (AFIP) manages its tax system, and the tax year aligns with the calendar year from 1 January to 31 December.
Labor Code
Argentina’s labor code, governed by the Argentine Labor Contract Law (Ley de Contrato de Trabajo), outlines regulations for employment relationships, including types of contracts, working hours, minimum wage, leave, workplace safety, termination procedures, and employee rights such as collective bargaining and protection from discrimination.
Minimum Wage
In 2024, the minimum wage in Argentina is ARS 234,315.12 per month.
Working Hours/Conditions
The standard workweek in Argentina is typically 48 hours, spread over six days. Overtime hours are compensated at a higher rate and are generally limited to a certain number of hours per week.
Overtime Pay
Overtime is granted to those that work up to 48 hours a week (above the normal 44-hour workweek). Employees working overtime are paid time and a half during the day and double pay during the night.
Employees
In Argentina, employees typically engage in several types of contracts governed by the Labour Contract Law (Ley de Contrato de Trabajo). The common types of employment contracts include the following:
- Permanent Contract (Contrato por Tiempo Indeterminado): This is the most common type of contract, where the employment relationship is ongoing without a specified end date. It provides employees with greater job security and entitlement to severance pay upon termination.
- Fixed-Term Contract (Contrato a Plazo Fijo): This contract specifies a start and end date for the employment relationship. It is typically used for temporary or project-based work and must meet certain legal requirements regarding duration and renewal limits.
- Part-Time Contract (Contrato a Tiempo Parcial): Part-time contracts involve fewer hours of work compared to full-time employment. Employees under this contract are entitled to prorated benefits based on their working hours.
- Trial Period Contract (Contrato de Prueba o Período de Prueba): This type of contract allows employers to assess the suitability of an employee for a limited period before confirming them as a permanent employee. It usually ranges from 15 to 30 days for most positions and up to 180 days for managerial roles.
- Apprenticeship Contract (Contrato de Aprendizaje): This contract is designed to provide training and skills development to young workers. It has specific regulations regarding the maximum age of the apprentice, duration of the apprenticeship, and training content.
- Seasonal Contract (Contrato de Temporada): Used in industries with seasonal variations in demand, such as agriculture or tourism, this contract covers employment during specific periods of the year.
Taxes
Incomes and cost of living are notably low in Argentina. Employees pay an income tax, as well as social security that includes a state-managed pension fund and health insurance. There are no payroll taxes in Argentina.
Income Tax Rates, Thresholds
Starting in fiscal year 2024, the government has introduced a new “cedular regime” aimed at “highest incomes,” defined as earnings exceeding 180 times the minimum wage (SMVM) and set as the non-taxable minimum.
Under this system, employees, retirees, and pensioners (excluding directors) will only be subject to income taxes when their gross monthly salary surpasses 15 times the SMVM at the time of assessment. This new regime includes a progressive tax scale with rates ranging from 27% to 35% (see Table 1). The SMVM value will be updated biannually, in January and July.
How Withholding Works
Income taxes are typically withheld mid-month from an employee’s paycheck, which may be distributed on either a monthly or weekly basis. Also, employers contribute toward the government’s social security program.
Returns, Tax Credits
If an employee still owes taxes at the end of the year, they must pay it by 15 June of the following tax year.
Social Security Tax
Employers in Argentina are required to contribute 26.4% of payroll costs if their primary business activities are in services or trade, and their annual sales exceed the regulatory thresholds, currently set at ARS 2,625,990,000 for services and ARS 10,310,100,000 for trade. For companies not meeting these criteria, the employer contribution rate is 24%.
The overall employee social security tax rate is 17%, comprising contributions of 11% to the pension fund, 3% to healthcare, and 3% to social services.
Gross Income Tax
This is a provincial tax applicable to self-employed individuals on gross earnings. The average tax rate is 4%.
Foreign Beneficiary Tax
Foreign beneficiaries can choose to pay 13.5% withholding tax of the total sale price or 15% on their capital gain. Dividends distributed to both domestic and foreign beneficiaries are taxed at a rate of 7%.
Corporate Tax
The Income Tax Law in Argentina applies a progressive tax structure, which is updated annually based on the IPC index. For fiscal year 2023, the tax rates are as follows:
- Companies with a net income of up to ARS 14.3 million are taxed at a rate of 25%
- Companies with a net income exceeding ARS 14.3 million but less than ARS 143 million must pay a fixed amount of ARS 3.6 million plus a 30% tax on income exceeding ARS 14.3 million
- Companies with a net income exceeding ARS 143 million are required to pay a fixed amount of ARS 42.2 million plus a 35% tax on income exceeding ARS 143 million
Resident companies in Argentina are subject to corporate income tax on a worldwide basis, meaning they are taxed on both local and foreign-source profits. However, they can offset similar income tax payments made abroad against their Argentine tax liability, within specified limits.
Pass-through entities themselves are not subject to taxes; instead, taxes are paid through withholding mechanisms for foreign individuals/entities, and resident individual shareholders are taxed based on the type of income they receive.
VAT
This is applied to sales of goods, services, and imports (including services imports) by businesses operating in Argentina. Exports are taxed at 0% (exporters can request refunds for VAT paid). The general rate is 21% and the reduced rate is 10.5% for specific goods and services.
Time Off
Leave
Argentinian employees are entitled to several types of leave as regulated by the Labour Contract Law, which includes the following:
Annual Leave: Minimum of 14 consecutive calendar days of paid leave after one year of service, increasing with tenure
Sick Leave: Paid leave for up to three months per year, depending on service length and with a medical certificate
Maternity Leave: 90 days of paid leave, with 45 days before and after childbirth, extendable under certain conditions
Paternity Leave: Up to 15 days of paid leave within 30 days of childbirth
Special Leave: Granted for events like marriage, bereavement, or relocation, varying in duration and conditions
Breastfeeding Breaks: Two paid breaks of up to 30 minutes each for nursing mothers with children up to one year old
National Holidays
Argentina observes numerous national holidays including New Year's Day, Carnival, Memorial Day, Holy Thursday (Maundy Thursday), Good Friday, Christmas Day, and more. These holidays are observed nationwide, with variations in regional significance and local customs (see Table 2).
Foreign Hires
While Argentina usually approves work visas liberally, the process for a work visa is complicated. Experts recommend that foreign workers begin working with their new employers for a work visa at least a month and a half before arriving in the country. Along with standard identity verification documents, foreign workers must present a PIM (entry permit), along with a police record and a hiring contract from the employer.
Visas
To obtain a working visa in Argentina, individuals typically need a job offer from an Argentine employer who will sponsor their visa application. The process involves submitting required documents, such as a passport, completed visa application form, proof of employment, criminal record certificate, and medical certificate, to the nearest Argentine consulate or embassy. Once approved, applicants can enter Argentina, start their employment, and may need to apply for a work permit if required.
Nonresidents and foreign beneficiaries are taxed exclusively on income derived from Argentine sources. Foreign beneficiaries temporarily working in Argentina for up to six months, earning income from visual arts, performing arts, or other professions, are subject to income tax at a rate of 24.5% (35% on an assumed profit of 70% of gross income), which is withheld by the local payer. Different tax rates may apply depending on the nature of the income received.
Culture
Argentina's culture is vibrant and diverse, influenced by European, indigenous, and immigrant traditions. Spanish is the official language. The cuisine is famous for beef, especially asado, empanadas, mate tea, and wines from Mendoza. Tango, originating in Buenos Aires, is a hallmark of Argentine music and dance. Football is a national passion, along with rugby and polo. Celebrations like Carnaval and Independence Day highlight the country's rich cultural heritage.