Understanding Peru's Tax Framework in 2025

Peru operates under a territorial tax system, meaning that both individuals and legal entities conducting business activities within the country are subject to its tax regulations. Residents of Peru must pay taxes on their worldwide income, while non-residents are taxed only on income generated within Peruvian territory. The fiscal year aligns with the calendar year, running from January 1 to December 31.

Main Taxes and Applicable Rates in Peru

Income Tax Structure

In recent years, Peru has refined its income tax policies to enhance clarity and fairness in taxation. These adjustments, effective since 2021, continue to shape the current landscape as of 2025.

• Domestic corporations—those headquartered or operating in Peru—are taxed at a flat rate of 29.5% on net profits.
• Non-resident companies earning income from Peruvian sources face withholding tax obligations, depending on the nature of revenue:
  • Interest income: 4.99%
  • Rental income from ships and aircraft: 10%
  • Royalties: 30%
  • Dividends and profit distributions: 5%
  • Technical assistance services provided locally: 15%
  • Transfer of movable assets (unless exempted under Law No. 30341): 5%
  • Other business operations conducted in Peru: 30%
• Cross-border income derived by foreign enterprises where part of the activity occurs in Peru is also taxable, including:
  • Air transport: 0.3%
  • Maritime shipping: 0.6%
  • Ship leasing: 8.0% (withholding rate at 10%)
  • Aircraft leasing: 6.0% (withholding rate at 10%)
  • Container provision for transport: 4.5%
  • Container demurrage fees: 24.0%
  • Insurance premiums: 2.1%
  • International news agency services: 3.0%
  • Film distribution rights: 6.0%
  • Television broadcasting rights: 6.0%
  • Telecommunications services: 1.5%
• For individual taxpayers residing in Peru, personal income tax follows a progressive scale based on annual earnings relative to the Tax Unit Index (UIT), which was set at 4,950 soles in 2025:
  • Up to 7 UIT: Exempt (0%)
  • 7–12 UIT: 8%
  • 12–27 UIT: 14%
  • 27–42 UIT: 17%
  • 42–52 UIT: 20%
  • Over 52 UIT: 30%

Additional rules apply to specific types of income. Rental income, capital gains, and other asset-derived revenues are generally taxed at 5% of gross profit. Dividends received by Peruvian residents from domestic firms are taxed at 5%. Non-resident individuals are liable only on Peruvian-sourced income—with rates of 30% for employment income and 24% for independent professional services.

Notably, Legislative Decree No. 31380, enacted in late 2021, granted temporary regulatory authority to the executive branch for economic reforms over a 90-day period. During this window, several decrees—including Supreme Decrees 1515, 1516, 1517, and 1522—were issued, refining compliance procedures and adjusting certain tax obligations related to corporate and individual filings.

Value Added Tax (VAT) – General Sales Tax (IGV)

Peru’s VAT, officially known as Impuesto General a las Ventas (IGV), stands at an inclusive rate of 18%, incorporating a 2% municipal development surcharge. Businesses can offset input VAT paid on purchases against output VAT collected on sales, making it a refundable mechanism for operational efficiency.

Exports of goods and services remain zero-rated, supporting international competitiveness. Additionally, large-scale investment projects may qualify for early VAT reimbursement prior to commercial operation, provided they meet key criteria:

• Total eligible expenditure exceeds USD 5 million (no minimum for agricultural ventures)
• Formal agreement with ProInversión (Peru’s Investment Promotion Agency) and relevant ministries
• Project development phase lasts at least two years

Mining companies and investors holding oil and gas exploration contracts may also claim VAT refunds during the exploratory phase, contingent upon signing formal investment agreements and committing more than USD 500 million in capital expenditures.

In December 2021, Decree No. 1519 extended VAT exemptions through 2022 for essential consumer goods, basic services, donated items, and diplomatic imports—a policy that influenced short-term trade dynamics but did not extend into 2025.

Selective Consumption Tax

This excise-style levy targets luxury and high-impact products such as alcoholic beverages, tobacco, cosmetics, fuel, and sugary drinks. Rates vary depending on product category and environmental considerations, aiming to balance public health goals with revenue generation.

Mining Royalties and Special Levies

The mining sector remains a cornerstone of Peru’s economy and is governed by a tiered royalty structure introduced in 2011. Companies pay three main components based on profitability and sales:

Taxes are calculated differently: resource tax applies to gross sales, while special taxes and contributions are assessed on operating profits, ensuring alignment with actual financial performance.

Other Key Taxes

Additional levies include:

• Financial Transaction Tax: 0.005% on most banking and securities transactions
• Corporate Dividend Distribution Tax: 4.1% on shareholder payouts

As of 2025, Peru does not impose digital service taxes or carbon emission levies, although discussions around green taxation are gaining momentum amid regional sustainability trends.

For multinational employers and expatriate workers navigating these regulations, partnering with experienced global HR providers like SailGlobal ensures compliant payroll processing, accurate tax reporting, and seamless workforce integration across borders.