Argentina

Between the Atlantic and Pacific oceans, Argentina lies at the southernmost point of South America, sharing the edge of the continent, and its western land-border, with Chile.

Civilisation has existed in the region which became Argentina for millennia, but the territory was colonised by Spain in the 16th century. Operated as a colony for over 100 years, Argentina eventually declared, its independence in 1818 - a moment followed by a period of civil war lasting until 1861.

Abundant natural resources, and rapid industrialisation, saw Argentina become one of the region’s wealthiest and most developed nations in the 20th century - and today it retains that influence as a member of the G20, the United Nations and other international organisations.

As one of the largest territories in South America, Argentina’s landscapes are diverse, ranging from jungles, grasslands, beaches and deserts, to the western mountains of the Andes.

Generally a temperate climate, Argentina experiences a variety of seasonal temperatures, and includes a vast amount of biodiversity - which has contributed to growing tourism interest from across the world.

General Information

• Population: 46.2million (World Bank, 2022)
• Capital: Buenos Aires
• Major Language: Spanish
• Monetary Unit: Argentine peso
• Main Exports: Cereals, Food industry waste and animal fodder, animal and vegetable fats, oils, and waxes, vehicles, mineral fuels including oil, oil seeds meat, other chemical goods, gems and precious metals and fish.
• GNI Per Capita: US $13,6863 (World Bank, 2022)
• Internet Domain: .ar
• International Dialing Code: +54

How do I say?

• Hello: Hola
• Good morning: Buenos días
• Good evening: Buenas noches
• Do you speak English?: Habla usted Inglés?
• Good bye: Adiós
• Thank you: Muchas gracias
• See you later: Hasta luego

Dates

Dates are usually written in the day, month and year sequence. For example, 1 July 2019 or 1/7/19.

The convention for writing numbers uses the comma as a decimal separator and the period to separate miles. For example three thousand five hundred twenty-five is written as 3,525.

Argentina, with its rich cultural heritage and strategic geographic position, serves as a vibrant gateway to South American markets. The country is renowned for its diverse economy, which spans from agriculture and mining to digital technology and renewable energy.

Entrepreneurs and businesses eyeing Argentina will find a welcoming environment for innovation, bolstered by a highly educated workforce and a growing emphasis on tech-driven industries. Navigating the Argentine business landscape necessitates a deep understanding of its regulatory framework, which underscores the importance of forming robust local partnerships. These alliances not only facilitate smoother market entry but also provide invaluable insights into consumer behavior and business etiquette in Argentina.

The Argentine market is known by its resilience and adaptability. Businesses looking to establish a footprint here must align with the country's economic policies and market dynamics.

Argentina's membership in Mercosur opens up expanded trade opportunities within South America, offering reduced tariffs and access to broader markets. However, success in this vibrant market requires a strategic approach to overcome challenges such as fluctuating economic policies and inflation.

Companies that leverage Argentina's competitive advantages, such as its rich natural resources, technological infrastructure, and creative talent, can successfully tap into its potential for growth and innovation.

Argentina is a gateway to South and Central America, with excellent shipping, road, rail and air links, including 23 international airports. Argentina ranks consistently high on the Logistics Performance Index in terms of the ease and affordability it offers businesses arranging international shipments.

As a member of the MERCOSUR regional bloc, Argentina enjoys a range of commercial benefits including free trade access to the markets of Brazil, Paraguay, and Uruguay. The Argentinian government is aiming to expand its international trade agreements over the coming years. Argentina has a population of over 46 million people, a high proportion of which hold a secondary education qualification or higher. Argentinian workers have some of the highest levels of English language proficiency in the region.

Argentina presents a fertile ground for investments, especially in sectors poised for growth and innovation like renewable energy, biotechnology, and information technology. The government's commitment to fostering a supportive environment for foreign investment is evident through various incentives, including tax benefits and grants aimed at research and development projects.

The burgeoning startup ecosystem in cities like Buenos Aires signals a promising horizon for venture capital investments, with tech startups leading the charge in innovation and digital transformation.

The Argentine government's focus on sustainable development has unveiled new avenues for investment, particularly in green technology and renewable energy projects. With its vast wind and solar potential, Argentina is an attractive destination for investors looking to contribute to and benefit from the transition to a more sustainable energy model.

The country's strategic initiatives to improve infrastructure, such as transport and telecommunications, enhance its attractiveness as an investment destination, offering long-term benefits for businesses committed to the Argentine market.

Argentina's rich natural resources and industrial capacity present numerous opportunities for Foreign Direct Investment (FDI), especially in mining, agriculture, food processing, and manufacturing. T

he country's mineral wealth, including lithium, copper, and gold, positions it as a key player in the global mining sector. Additionally, Argentina's agricultural sector, a cornerstone of its economy, offers prospects for investment in biotechnology and sustainable farming practices.

Argentina has implemented several policies aimed at encouraging FDI, focusing on creating a more favorable business environment. These include simplifying the process for establishing and registering businesses, providing tax incentives for investments in key sectors, and enhancing legal protections for investors. The government also offers specific programs to support foreign investors, including access to financing and assistance with navigating regulatory requirements. By capitalising on these opportunities and aligning with government initiatives, foreign investors can play a pivotal role in Argentina's economic development while achieving substantial returns on their investments.

This expanded content provides a comprehensive overview tailored for businesses considering expansion into the Argentine market, highlighting the strategic advantages, investment opportunities, and the supportive environment for foreign direct investment. Key FDI includes:

• Manufacturing and Construction
• Mining and Oil Extraction
• Retail
• Banking and Financial Services
• Information and Communication
• Agriculture

There are three main types of business entities in Argentina:

1. Limited Liability Company (S.R.L.)
2. Corporations (S.A.)
3. Simplified Joint Stock Company (S.A.S.)

Corporations (Sociedad Anónima)

Public Limited Companies are generally linked to large companies. The capital is divided into shares, and unlike S.R.L.s, in which shares cannot be transferred without limitations, in Sociedad Anónima (S.A.). The shares may be inherited, sold or transferred without any obstacles. The shares contributed by each member are those that limit the liability of each partner.

A Public Limited Company presents much more dynamism than S.R.L.s, due to the simplicity when selling or transferring shares. This allows the entry and exit of members to the society in a fluid manner.

To establish an S.A there is no limit on the number of partners, but a minimum of two is needed. They may be natural or legal persons. At least, to form an S.A. In Argentina, a capital of $100,000 must be contributed. As in the S.R.L., you can start with only 25% of that sum, and the remainder during the two years that follow.Regarding the organisation of Public Limited Companies, the following roles must be established:

1. Board of Directors: made up of one or more people elected by the shareholders. They are in charge of the administration of the S.A.
2. Government: made up of shareholders. They are required to meet in an assembly once a year.
3. President of the S.A.: representative figure of the company.

Limited Liability Companies (Sociedad de Responsabilidad Limitada)

In this type of commercial company, as its name indicates, liability is limited only to the capital contributed by the partners at the time of its constitution. This means that when responding to debts, only the assets of the company will be used and not the personnel of the members.

In an Sociedad de Responsabilidad Limitada (S.R.L.), the capital contributed by the members is divided into quotas or participation's. Each member may acquire the number of shares he wishes, and his responsibility will be limited only to that acquisition.

Limited Liability Companies must have a minimum of two partners, and a maximum of fifty. One or more managers must be appointed, who will be the representative figures of the company.

With respect to capital, there is no minimum contribution, but it must coincide with the expected assets for the type of activity that the company will carry out. At the time of establishing the S.R.L., only 25% can be contributed. The remaining capital must be credited during the next two years.

Simplified Joint Stock Company (Sociedad por Acciones Simplificada)

This type of company was recently approved in Argentina. It is the simplest and fastest way for a company to establish a company, since the process can be carried out online, and in 24 hours.

The Sociedad por Acciones Simplificada (S.A.S.) They arise in the context of the Entrepreneurs Law. It is aimed at small companies, because it has simple and lower cost incorporation requirements compared to S.A. and S.R.L.

To establish a Simplified Joint Stock Company, only capital equivalent to the sum of two minimum vital and mobile salaries must be contributed. In addition, members may choose to invest only 25% at the time of incorporation (as happens in other types of companies), and the remainder during the two years that follow.

Regarding the organisation, the partners will only limit their liability to the capital they contribute. A S.A.S. can be established. sole proprietorship (with only one partner), or there may be several, both legal and natural persons.

An administrator (or several) must be designated, who must have a CUIT and Tax Code to enter AFIP.

All Argentine companies must keep two legal registration books:

1. Shareholder Registry Book
2. Accounting books

Employing in Argentina generates a unique set of prerequisites that international businesses must meet for streamlined operation.

For an employee to be compliant with the Argentine labour laws, they must have a National Identity Document (DNI) and a CUIL (Unique Labor Identification Code). The DNI is a legal identity card while the CUIL serves as a key identifier for social security services. 

Employee-employer relations are governed by an appropriate employment contract mandated by Argentine laws. The contract must comply with labour and social security laws prevalent in Argentina. Partner with a knowledgeable organisation that understands the nuances of international legislation and Argentine workforce norms to ensure your employment contracts are above board.

In some instances, employees may also require a residence visa to legally work within the country. This is typically acquired through Argentina's National Immigration Directorate. The three main types of visas are:

• Temporary residence visa
• Transitory visa
• Permanent resident visa

Temporary Residence Visa

The Temporary Residence Visa is suitable for those intending to stay in Argentina for up to one year. This visa is intended for individuals who are going to Argentina for work or study purposes, or to reunite with family.

To apply for a Temporary Residence Visa, the employee must provide the National Immigration Directorate with their DNI, a copy of their employment contract, and other supporting documents. Our team can guide you through the specifics to ensure a smooth application process.

Transitory Visa

The Transitory Visa is designed for short-term stays in Argentina. This type of visa includes specific categories such as tourist, business professional, or artistic activities, among others, each with its own criteria.

Application for a Transitory Visa involves submission of required documentation depending on the category of visa. 

Permanent Residence Visa

The Permanent Residence Visa is for those who intend to reside in Argentina indefinitely. This may apply to directors or long-term employees you intend to relocate.

To apply for a Permanent Residence Visa, the employee needs to prove their residential intention, economic solvency, and good character through several thorough checks.

It is not mandatory to have a bank account in Argentina to do business, but it is highly recommended.

In Argentina, there are options to open a free bank account, such as the Universal Free Account, which can be opened in any financial institution that allows operating with ATMs.

The Argentina tax year runs from 1 January to 31 December for individuals and corporations.

The key legislative authorities in Argentina are:

• Ministry and social security law
• Income Tax Law
• Value Added Tax Law

Income Tax

In Argentina, the Personal Income Tax (Profit) taxes the net income of individuals, while the Corporate Income Tax (IG) applies to the net profits of legal entities. Both taxes are calculated on net income, subtracting deductible expenses from gross income. Income Tax rates are progressive (5% to 35%), while the IG rate is 35%. Both are paid through withholdings at source and payments on account, and are declared annually between April and June.

Corporate Income Tax

Individual Employment Income Tax (monthly)

Social security fees are paid between the employer and the employee. The division is made as follows:

• Pension: 11%
• PAMI (Instituto Nacional de Servicios Sociales para Jubilados y Pensionados): 3%
• Social work: 3%

• National employment found: 1.5%
• Mandatory life insurance: 0.03%
• Family´s assignations: 7.5%
• Pension: 16%
• PAMI (Instituto Nacional de Servicios Sociales para Jubilados y Pensionados): 2%
• Social work: 6%
• ART: The percentage of contribution to the ART (Occupational Risk Insurance Company) in Argentina is variable and depends on the contribution established by the ART.

Social security contributions in Argentina must be paid by employers, and are made on a monthly basis.

Monthly

In Argentina, social security contributions from the employer must be submitted monthly. The deadlines for the payment of social security contributions vary depending on the last digit of the CUIT (Unique Tax Identification Code) of the company. For example, for the year 2024, the deadlines are as follows:

• Digits 00 to 07: from the 2nd to the 7th of the following month.

• Digits 08 to 14: from the 8th to the 14th of the following month.

• Digits 15 to 21: from the 15th to the 21st of the following month.

• Digits 22 to 28: from the 22nd to the 28th of the following month.

• Digits 29 to 35: from the 29th to the 31st of the following month.

An employer must report any new employees to the Social Security Office within the first eight day of employment. The first 30 days of employment is generally used as a probation period whereby the employer or employee can terminate employment without any notice. Probation periods should last no longer than three months.

An employer must issue an employment contract listing the terms of employment and it should be signed by both the employer and employee and sent to the government within 15 days of employment. The employment contract must cover the following information:

• Names, nationality, age, sex and marital status

• Address of the contracting parties

• Identity card number

• Accurate detail of the worker’s residence

• Duration of the contract

• Working hours

• Salary to be received by the worker and details related to the form, period and place of payment

• The quantity and quality of the material, the state of the tools and the employer’s tools, if any, that will be provided to execute the work

• The place or places where the service must be provided or the work executed

• Other stipulations to which the parties agree

• The place and date of the conclusion of the contract

An employer must always have reasonable cause (disobeying company rules, stealing, etc.) to fire an employee on the spot. The employer must provide the employee with a termination letter that clearly states the reason for termination.

If the employer has no reasonable cause to terminate an employee or if the employee resigns for reasonable cause, the employee is entitled to severance pay, which is paid on the last day of employment.

If an employee has worked for a company for more than one year, the employer must pay compensation equivalent to one month's salary for each year of service or fraction greater than three months, based on the best remuneration. monthly, normal and customary, accrued during the last year or during the time of provision of the services, whichever is less. The amount of this compensation may in no case be less than one month's salary calculated based on the system established in the first paragraph.

It is legally acceptable in Argentina to provide employees with online payslips, however employees must reply via email confirming that the payment was received.

Reports

Payroll reports must be kept for five years.

Payslip Example

Holiday Accrual and Calculations

The employee has the right to enjoy a minimum and continuous period of paid annual rest for the following periods:

• Fourteen (14) calendar days when seniority in employment does not exceed five (5) years.

• Twenty-one (21) calendar days when the duration of service exceeds five (5) years but does not exceed ten (10) years.

• Twenty-eight (28) calendar days when the seniority, being greater than ten (10) years, does not exceed twenty (20).

• Thirty-five (35) calendar days when the seniority exceeds twenty (20) years.

To determine the extension of the vacation according to seniority in employment, it will be counted as what the employee would have on December 31 of the year to which the vacation corresponds.There are two days of unpaid leave for national holidays and eight paid national

Maternity Leave

Eligible employees are entitled to 45 days of leave before childbirth and 45 days after childbirth. Maternity leave is financed by the National Social Security Administration (ANSES).

Paternity Leave

Parents have the right for the birth of a child to two consecutive days, fully paid.

Sickness

Sick leave is a fundamental right for workers, guaranteed by labour legislation. The duration of sick leave may vary, but in general, the first 3 days can be paid by the employer, and after this period, the worker's social work or health entity assumes payment. If the illness is prolonged, the deadlines can be extended, and there are provisions for cases of serious illness. During sick leave, the worker has the right to receive his or her usual remuneration. The worker must notify that she is sick from the first day that she cannot go to work and must prove this situation through a medical certificate. The employer has the right to hire a replacement while the worker is on leave, and in this case, she must register as a temporary worker, with a predetermined end date for the employment relationship.

National Service

In Argentina, there is no mandatory national service like military service.

The working week and hours in Argentina vary across the country.

Working hours in Argentina are typically extended to eight hours a day and no more than 48 hours a week are worked.

As long as the work does not affect an employee's health, some employers extend the work day to nine hours a day.

.

The current minimum wage in Argentina is ARS 156,000.00 per month in 2024.

It came into force on December 1, 2023, and remains valid in 2024.

There are multiple statutory holiday schedules within Canada. Below are the statutory national holidays in Argentina for 2024.

Expenses

Many employers offer additional benefits to their employees, including vehicle allowance, education payments and bonuses. These all vary depending on the company and the payment of additional benefits is reported in the monthly form submitted to the Social Security Office.

Thirteenth Month Bonus

Known locally as 'Aguinaldo', every worker in Argentina has the legal right to receive the thirteenth month bonus. The supplementary annual salary will be paid in two (2) installments: the first due on June 30 and the second due on December 18 of each year. The amount to be paid in each semester will be settled based on the calculation of fifty percent (50%) of the highest monthly remuneration accrued for all concepts within the two (2) semesters ending in the months of June and December of each year.

Mandatory medical program (PMO)

The PMO is a set of basic medical-care benefits that prepaid medicine entities and social works must provide to their members in Argentina. That is, it is a list of services and treatments that health companies are obliged to cover by law.

The PMO covers a wide range of benefits, including:

• Medical consultations
• Diagnostic studies
• Delivery and care of the newborn
• Mental health

All members of prepaid medicine entities and social works have the right to the PMO, regardless of their plan or category.

In 2024, Argentina is seeing several key updates in the areas of income tax, social security, and employment law:

Income tax

The tax rates for individuals for the year 2024 are as follows:

• Income from 0 to 97,202 ARS: 5%
• Income from 97,202.01 to 194,404 pesos: 9%
• Income from 194,404.01 to 291,606 pesos: 12%
• Income from 291,606.01 to 388,808.01 pesos: 15%
• Income from 388,808.01 to 583,212.01 pesos: 19%
• Income from 583,212.02 to 777,6161.01 ARS: 23%
• Income from 777,616.02 to 1,166,424.02 pesos: 27%
• Income from 1,166,424.02 to 1,555,232.07 pesos: 31%
• Income greater than $1,555,232.07: 35%

Corporate Tax

The corporate tax rates for the year 2024 are as follows:

• up to ARS 34,703,523.08 25%
• over ARS 34,703,523.08 up to 347,035,230.79 30%
• over ARS 347,035,230.79 onwards 35%

Please note that this document gives general guidance only and should not be regarded as an authoritative or complete statement of the law, regulations or tax position in any country. You should always seek specific advice for each specific situation. This document should not be relied upon as professional advice and activpayroll accepts no liability for reliance on its contents.