Peru Tax Regime

Peru operates a classical corporate income tax system with a flat headline rate for resident companies, a higher gross-basis rate for non-domiciled companies without a local presence, and a well-developed withholding regime on outbound payments. The general corporate income tax (CIT) rate is 29.5% on worldwide net income for domiciled companies, one of the more moderate rates in the region, complemented by targeted incentive regimes for agriculture, mining and specific export activities. Peru's system is administered by the National Superintendency of Customs and Tax Administration (SUNAT) and is closely aligned with OECD transfer pricing standards despite Peru not yet being an OECD member, reflecting its ongoing accession process. The regime combines broad worldwide taxation of resident entities with a strict source-based approach for non-residents, and continues to evolve through annual legislative decrees and Tax Court (Tribunal Fiscal) jurisprudence.

1.1 Sources

Primary legislation includes the Peruvian Income Tax Law (Ley del Impuesto a la Renta, PITL) and its regulations, the General Sales Tax Law (Impuesto General a las Ventas, IGV), and the Tax Code (Código Tributario).

1.2 Recent developments

A new reduced-rate regime for agricultural companies took effect from 1 January 2026, granting a 15% corporate income tax rate for qualifying agricultural and agro-export activities through 2035, replacing the prior agricultural promotion regime and aiming to sustain investment in the sector. Peru continues to refine its general anti-avoidance rule (Norma XVI of the Tax Code) and its beneficial-ownership and ultimate-beneficial-owner disclosure obligations in line with international transparency standards. Transfer pricing documentation and country-by-country reporting obligations for large multinational groups remain in force, and Peru continues to expand its double tax treaty network and participation in multilateral tax transparency instruments as part of its OECD accession process.

Headline statutory corporate income tax rate for a resident company. Where sub-national (state, provincial, cantonal or municipal) corporate taxes apply, the combined rate reported by the OECD is shown. Projected 2026–2028 rates carry the current rate forward unless a change is already enacted or officially scheduled. As-of 2026.

Top marginal statutory personal income tax rate on employment income for a resident individual. Where sub-national (state, provincial, cantonal or municipal) income taxes are a standard part of the system, the combined top rate is shown. Projected 2026–2028 rates carry the current rate forward unless a change is already enacted or officially scheduled. As-of 2026.

2.1 Rates and residence

Companies incorporated in Peru are considered domiciled for tax purposes and are subject to corporate income tax at 29.5% on worldwide net income. Non-domiciled companies — those incorporated abroad without a permanent establishment in Peru — are taxed, in most cases, at 30% on gross Peruvian-source income, generally collected by withholding, and are not permitted to deduct expenses against that gross income. A reduced 15% rate applies to qualifying agricultural companies under the new regime effective from 1 January 2026 through 2035. There are no local or provincial taxes on income in Peru; corporate income tax is levied exclusively at the national level.

Domiciled companies determine taxable income on a worldwide basis, crediting foreign income taxes paid against Peruvian CIT (subject to the foreign rate not exceeding the Peruvian rate and the income qualifying as foreign-source for Peruvian purposes) to relieve double taxation. Peru additionally imposes a 5% tax on amounts treated as an indirect distribution of income identified on audit — for example, disguised benefits to shareholders that escape ordinary withholding — in addition to any other applicable tax.

2.2 Dividends and participation exemption

Dividends and other profit distributions made by a Peruvian company to another Peruvian resident legal entity are not subject to withholding tax, avoiding cascading taxation within domestic corporate chains. Distributions to non-resident entities or individuals, and to resident individuals, are subject to a 5% withholding tax, applied on the earlier of actual distribution or the date the distribution is agreed by shareholders. There is no separate participation exemption for capital gains on shares; gains on the disposal of shares in Peruvian companies are generally subject to ordinary income tax rules, with specific source and indirect-transfer rules applying to disposals of shares in foreign entities holding Peruvian underlying assets.

2.3 Income determination and deductions

Taxable income is determined by deducting expenses that are necessary to generate or maintain the source of taxable income (the causality principle) from gross income, subject to specific requirements, limitations and caps for certain categories: thin capitalisation rules limit the deductibility of interest on related-party debt; bad debt provisions are deductible only where specific conditions demonstrating uncollectibility are met; salary, travel, gift, donation and entertainment expenses are subject to quantitative caps or documentation requirements; and fines, penalties and certain non-business expenditure are non-deductible. Depreciation follows statutory maximum annual rates by asset category, generally on a straight-line basis, with accelerated depreciation available for qualifying leased assets and specific incentive regimes.

2.4 Interest limitation

Peru applies a general interest deductibility limitation based on a debt-to-equity-style thin capitalisation test for related-party loans, denying deduction of interest attributable to related-party debt exceeding a prescribed multiple of the borrower's equity. In addition, Peru has progressively aligned with an EBITDA-based limitation (consistent with BEPS Action 4 principles) restricting the deductibility of net interest expense generally, with safe-harbour thresholds for smaller taxpayers and carveouts for regulated financial-sector borrowing. Interest paid to related parties resident in jurisdictions with no or nominal taxation, or benefiting from a preferential tax regime, is subject to heightened scrutiny and potential denial of deduction.

2.5 Losses

Taxpayers may elect between two systems for carrying forward tax losses: a four-year carryforward of the full loss against 100% of taxable income in each of those years (with any unused balance lapsing thereafter), or an indefinite carryforward limited to offsetting 50% of taxable income in each subsequent year. The election is made with the tax return for the year the loss arises and is binding until the loss is fully absorbed. There is no loss carryback. Losses are generally not transferable on a change of ownership achieved through share acquisition, but the tax attributes of a target can survive a qualifying reorganisation under the tax-neutral merger regime.

2.6 Group taxation

Peru does not have a fiscal consolidation or group-relief regime; each Peruvian company files and is assessed on a stand-alone basis, and losses of one group company cannot be offset against the profits of another. Group efficiency is instead pursued through intra-group service and financing arrangements (subject to transfer pricing and thin capitalisation rules) and through tax-neutral reorganisations — mergers, spin-offs and business-unit transfers — carried out under the regime that permits carryover of tax basis in qualifying transactions without triggering immediate taxation of unrealised gains.

2.7 Controlled foreign companies

Peru operates a CFC regime that attributes passive income of a controlled non-domiciled entity to its Peruvian resident controlling shareholders (individuals and legal entities holding, directly or indirectly, 50% or more of the capital, results or voting rights) where the foreign entity is resident in a jurisdiction with a tax rate lower than 75% of the Peruvian corporate rate, or benefits from a preferential regime, and its passive income represents more than 20% of total income. Attribution applies to dividends, interest, royalties, capital gains on movable property, and certain other passive categories, taxed in the hands of the Peruvian shareholder in proportion to its participation, regardless of actual distribution.

2.8 Transfer pricing

Related-party transactions must be conducted on arm's-length terms under OECD-aligned transfer pricing rules incorporated into the PITL and its regulations. Peru requires a local file for taxpayers exceeding prescribed revenue and related-party transaction thresholds, a master file for taxpayers belonging to groups exceeding a higher threshold, and country-by-country reporting for Peruvian parent entities of multinational groups with consolidated revenue exceeding the internationally standard threshold (broadly equivalent to EUR 750 million). Transactions with parties resident in tax havens or benefiting from preferential regimes are subject to transfer pricing rules regardless of whether the parties are related. An advance pricing agreement mechanism is available for qualifying taxpayers.

2.9 Incentives

Peru's principal current incentive is the new agricultural regime, granting a 15% corporate income tax rate to qualifying agricultural and agro-export companies from 2026 through 2035, alongside accelerated depreciation for agricultural infrastructure and irrigation works. Mining and hydrocarbons benefit from stability agreements that can freeze the applicable tax regime for the life of an investment project, and from specific rules on recovery of exploration and development costs. Reinvestment incentives exist for specific sectors (such as the education sector's incentive for reinvestment of profits in educational infrastructure). Free trade zones (zonas francas) offer exemption from CIT and IGV for qualifying industrial and logistics activities located within them.

2.10 Pillar Two

Peru has not enacted Pillar Two legislation implementing an income inclusion rule, undertaxed profits rule or qualified domestic minimum top-up tax as of mid-2026. Multinational groups with Peruvian operations should nonetheless monitor the interaction between Peru's incentive regimes — including the reduced 15% agricultural rate and mining stability agreements — and the global minimum tax rules implemented by parent jurisdictions, since low-taxed Peruvian profits could generate top-up tax liability abroad notwithstanding the absence of domestic Pillar Two rules.

2.11 Branch income and reorganisations

A Peruvian branch of a foreign company is taxed on Peruvian-source income attributable to the branch at the standard 29.5% domiciled rate (branches are treated as domiciled for this purpose once registered and operating through a permanent establishment), rather than at the higher non-domiciled gross-basis rate. There is no branch remittance tax as such, but branch profits are deemed distributed to the foreign head office on the expiry of the deadline for filing the annual income tax return, whether or not anything is actually remitted, and bear the 5% rate applicable to dividends and other forms of profit distribution under article 56(e) of the Income Tax Law. The base is the branch's net income increased by exempt interest income and by dividends or other distributions and amounts otherwise available generated during the year, less the tax paid under the preceding article (article 56, second paragraph following subparagraph (e), as amended by Decreto Legislativo N.° 1424). The 5% rate itself was set by article 3 of Decreto Legislativo N.° 1261 with effect from 1 January 2017; Decreto Legislativo N.° 1541, in force from 1 January 2023, did not change it but broadened subparagraph (e) by removing its former restriction to distributions received from the legal persons referred to in article 14 of the Law. Domestic reorganisations — mergers, spin-offs and business-unit transfers — can be carried out under a tax-neutral regime that permits the surviving or resulting entity to carry over the tax basis of transferred assets and, subject to conditions, the tax attributes of the transferring entity, deferring taxation of unrealised gains until a subsequent disposal.

3.1 Residence and rates

Individuals are resident (domiciled) in Peru if present in the country for more than 183 days within any 12-month period, or if Peru is their habitual residence; Peruvian nationals retain domiciled status for tax purposes for a period after departure unless specific conditions for change of domicile are met. Domiciled individuals are taxed on worldwide income; non-domiciled individuals on Peruvian-source income only. Employment and independent-work income is taxed under a progressive scale with 2026 brackets running from 8% on the lowest tranche of net taxable income up to a top marginal rate of 30% on income above roughly 45 tax units (Unidad Impositiva Tributaria, UIT — an annually adjusted reference value), with the schedule applying separately to employment/independent-work income (renta del trabajo) after a standard deduction.

3.2 Capital income and real estate

Capital income (renta de capital) — including rental income, interest, royalties and capital gains — is generally taxed separately from employment income at a flat rate of 6.25% on net income after a standard 20% deduction for certain categories, giving an effective rate of 5% on gross income once the deduction is applied; dividends received by resident individuals are taxed at a flat 5% withholding rate, consistent with the corporate-level dividend withholding described in section 2.2. Capital gains on the disposal of Peruvian real estate by individuals are taxed at 5% on the net gain (after deducting acquisition cost adjusted for inflation where applicable), with an exemption commonly available for the taxpayer's sole residence held for a minimum period. Capital gains on listed securities traded through the Lima Stock Exchange benefit from exemption thresholds and rules designed to support market liquidity.

3.3 Social security and payroll

Employees contribute to a pension system through either the state pay-as-you-go system (ONP, at a rate of 13% of remuneration) or a private pension fund administrator (AFP, combining a contribution rate plus fund-management and insurance fees, together generally somewhat higher than the ONP rate). Employers contribute to Social Health Insurance (EsSalud) at 9% of payroll and, for certain sectors, to complementary risk-work insurance. Employers withhold income tax on employment income monthly on a projected annual basis, reconciled at year-end; a mandatory profit-sharing obligation (participación en las utilidades) requires qualifying employers to distribute a percentage of pre-tax profits to employees based on sector and headcount.

3.4 Inbound individuals

Peru does not levy a net wealth tax or an inheritance/gift tax on individuals. Inbound foreign executives and professionals are taxed as non-domiciled individuals on Peruvian-source income until they meet the 183-day domicile threshold, after which worldwide taxation applies; treaty relief may reduce Peruvian withholding on cross-border remuneration structures where a treaty applies. There is no special expatriate remittance-basis or preferential inbound regime comparable to those in some other jurisdictions, though short-term assignees structured to remain below the domicile threshold can limit Peruvian exposure to Peru-source income only.

Domestic withholding applies to dividends at 5% (both to non-residents and resident individuals), to interest paid to non-residents generally at 4.99% where specific registration and arm's-length conditions on cross-border loans are satisfied (30% otherwise, reflecting the general non-domiciled rate, subject to reduction for qualifying bank and capital-market financing), and to royalties and technical/management service fees paid to non-residents generally at 30% on the gross payment, absent treaty relief or a specific reduced statutory rate for digital and technical assistance services. Peru's treaty network, while smaller than some regional peers, includes conventions with major trading partners and the Andean Community multilateral framework, typically reducing dividend withholding to 10–15% for qualifying holdings and interest/royalties to a comparable reduced range, subject to beneficial-ownership requirements.

Non-domiciled companies without a permanent establishment are taxed at 30% on gross Peruvian-source income across most categories not otherwise subject to a specific reduced statutory withholding rate, collected by withholding at source by the Peruvian payer. Peru's Andean Community double taxation decision (Decision 578) provides an alternative source-based allocation framework for income flows between Bolivia, Colombia, Ecuador and Peru, which can produce different outcomes from Peru's bilateral treaties and should be checked where relevant.

5.1 General anti-abuse and hybrids

Peru's general anti-avoidance rule (Norma XVI of the Tax Code) empowers SUNAT to disregard the civil or commercial form of acts, situations or relationships that lack economic substance and are structured principally to obtain a tax advantage, recharacterising the transaction according to its economic substance and assessing tax, interest and penalties accordingly. Application of Norma XVI requires a qualified committee's prior opinion for penalty purposes. Peru does not yet operate a comprehensive statutory hybrid-mismatch regime of the ATAD type; cross-border arrangements producing deduction/non-inclusion outcomes are addressed through the CFC rules, transfer pricing rules, and the general anti-avoidance rule as applicable.

5.2 Exit taxation and disclosure

Peru does not impose a dedicated exit tax on the migration of corporate tax residence; indirect transfer rules instead tax gains realised by non-residents on the disposal of shares in foreign entities where a threshold percentage of the foreign entity's value derives from Peruvian underlying assets, capturing offshore restructurings that would otherwise avoid Peruvian tax on the underlying Peruvian assets. Peru requires beneficial-ownership disclosure for Peruvian entities and participates in automatic exchange of financial account information under the Common Reporting Standard. There is no DAC6-equivalent mandatory disclosure regime for cross-border tax arrangements, though transfer pricing and CFC filing obligations provide SUNAT with substantial visibility into cross-border structures.

6.1 VAT

The General Sales Tax (Impuesto General a las Ventas, IGV) is levied at a combined rate of 18% (comprising a 16% IGV component and a 2% municipal promotion tax) on the sale of goods, provision of services, construction contracts, first sale of real estate by a builder, and imports. Exports are zero-rated with recovery of input IGV through a drawback-style refund mechanism. Registration is mandatory for businesses carrying out taxable activities; there is no general small-business exemption threshold, though a simplified single-payment regime (Nuevo RUS) is available for very small taxpayers below prescribed turnover limits, replacing IGV and income tax with a single small flat payment. Monthly IGV returns are filed and settled according to a schedule based on the taxpayer's last RUC digit.

6.2 Transaction, payroll and other taxes

A financial transactions tax (Impuesto a las Transacciones Financieras, ITF) applies at a low rate to specified debits and credits through the Peruvian financial system. Real estate transfers attract a municipal property transfer tax (Alcabala) generally at 3% of the transfer value in excess of a small exempt tranche, payable by the buyer. Annual municipal property tax (Impuesto Predial) is levied on the value of real estate at progressive rates up to around 1%. A selective consumption tax (Impuesto Selectivo al Consumo, ISC) applies to fuel, vehicles, tobacco, alcohol and other specified goods. Peru does not levy a general net wealth tax. Temporary net assets tax (ITAN) applies to companies based on the value of net assets shown on the prior year's balance sheet, creditable against corporate income tax.

7.1 Filing, assessment and audit

The tax year is the calendar year for both corporate and individual taxpayers. Annual corporate income tax returns are filed electronically with SUNAT typically between March and April of the following year according to a schedule based on the taxpayer's RUC number, with monthly advance payments made throughout the year based on a percentage of monthly net income (generally 1.5% or a coefficient derived from the prior year's effective rate, whichever is higher, subject to specific rules). SUNAT conducts risk-based audits within the statutory limitation period, generally four years from the filing deadline (extended to six years for non-filers and indefinitely in cases of fraud). Electronic invoicing and real-time transaction reporting obligations give SUNAT extensive visibility into taxpayer activity.

7.2 Rulings, appeals and penalties

Taxpayers may request binding rulings from SUNAT on the interpretation of tax rules and advance pricing agreements for transfer pricing certainty. Assessments can be challenged through an administrative reclamation before SUNAT, appeal to the Tax Court (Tribunal Fiscal), and ultimately judicial review before the Judiciary through a contentious-administrative action. Late payment attracts moratorium interest calculated daily on the outstanding balance, and penalties for late filing, under-declaration or non-compliance with formal obligations are set as a percentage of the tax due or by reference to tax units, with reduction regimes available for voluntary correction before SUNAT detection.

Filing schedules are staggered across several business days each month according to the last digit of the taxpayer's RUC (single taxpayer registry number), so the precise due date varies by company even though the underlying obligation is common to all taxpayers. Late monthly advance payments generate moratorium interest even where the annual liability is ultimately lower once trued up on the annual return.

9.1 Entity choice

The sociedad anónima (SA) and its simplified variant, the sociedad anónima cerrada (SAC), are the standard corporate vehicles for most investors, offering limited liability and flexible governance; the SAC, with a maximum of 20 shareholders and lighter formalities, suits closely held operating subsidiaries. The sociedad comercial de responsabilidad limitada (SRL) remains available for smaller ventures. Branches of foreign companies are used for time-limited projects, particularly in construction, mining services and engineering, and are taxed at the standard 29.5% domiciled rate on Peru-attributable income rather than the higher non-domiciled gross rate.

9.2 Structuring and incentives

Investors in agriculture should structure to qualify for the new 15% rate available through 2035, evaluating processing-versus-primary-production activity splits carefully against the regime's qualifying-activity definitions. Mining and hydrocarbon investors should evaluate a legal stability agreement to lock in the tax regime for the investment horizon, particularly given historical rate volatility in the sector. Related-party financing must respect the thin capitalisation and EBITDA-based interest limitation rules described in section 2.4, and cross-border service and royalty flows should be tested against the elevated 30% non-domiciled withholding rate where no specific reduced rate or treaty applies. CFC exposure under section 2.7 should be assessed for holding structures using low-tax intermediate jurisdictions.

9.3 Worked effective-rate illustration

A Peruvian domiciled manufacturing company reports EBITDA of USD 5,000,000, depreciation of USD 600,000 and net interest expense of USD 300,000 on related-party debt that remains within the thin-capitalisation and EBITDA-based limits, so the full interest is deductible. Taxable income is 5,000,000 − 600,000 − 300,000 = USD 4,100,000. CIT at 29.5% is USD 1,209,500, giving an effective rate of 1,209,500 / 4,100,000 = 29.5% on taxable profit (no incentive applies in this illustration). If instead the company qualified for the new agricultural regime at 15%, CIT would be 4,100,000 × 15% = USD 615,000, an effective rate of 15.0% — a reduction of USD 594,500 in absolute tax, illustrating the materiality of regime qualification. If the full after-tax profit of USD 2,890,500 (standard-rate case) were distributed to a non-resident shareholder, dividend withholding of 5% would apply, adding USD 144,525 and bringing the combined effective burden on distributed profits to approximately 29.5% + (70.5% × 5%) ≈ 33.0%.

9.4 Compliance

Expect mandatory electronic invoicing, monthly IGV and advance CIT payment compliance on a RUC-based staggered schedule, transfer pricing local file/master file/CbCR obligations above the applicable thresholds described in section 2.8, temporary net assets tax filings, beneficial-ownership disclosure for corporate taxpayers, and — for qualifying employers — annual profit-sharing distribution to employees. Groups relying on stability agreements or the agricultural regime should maintain contemporaneous evidence of continued qualification, since SUNAT can challenge regime eligibility on audit.