Worried about taxes in Peru? Whether you’re moving to Lima, running a business from abroad, or working with Peruvian clients—understanding taxes in Peru is essential to stay compliant and avoid surprises.
At NVC Abogados, we help expats, freelancers, investors, and entrepreneurs manage their tax obligations with confidence. From monthly filings to annual returns, we ensure your taxes are accurate, optimized, and fully compliant with Peruvian law.
Understanding taxes in Peru
Unlike the United States but like most other countries, Peru does not tax worldwide income unless you are a tax resident. And tax residency is not based on citizenship, but on physical presence. If you spend more than 183 days in Peru within a 12-month period, you are considered a tax resident the following calendar year. From then on, your global income is subject to tax in Peru.
If you are not a tax resident, you are only required to pay taxes on Peruvian-source income.
SUNAT confirms:
“Al ser no domiciliado te encuentras obligado a cumplir con tus obligaciones tributarias únicamente respecto de tus rentas de fuente peruana.”
“As a non-resident, you are only required to comply with tax obligations on income from Peruvian sources.”
🔗 SUNAT – Régimen para no domiciliados
Income tax categories in Peru
Peruvian tax law divides income into five categories. The tax rate, declaration rules, and withholdings depend on the category:
First Category
First Category income includes earnings from renting or subletting real estate in Peru. This covers not only rent payments but also any additional charges or property taxes paid by the tenant on the owner’s behalf. If the total annual rent is below 6% of the property’s official municipal value (autoavalúo), the law requires declaring a presumed income of 6%. The same category also applies to the temporary leasing of other movable or immovable goods, and even to the free use of property, which triggers a presumed income rule (6% or 8%, depending on the asset). Improvements made by tenants that benefit the owner may also be considered taxable income.
Second Category
Second Category income includes capital gains from the sale or transfer (enajenación) of shares, bonds, securities, and similar financial instruments considered Peruvian-source income. This applies when individuals earn a profit from selling or redeeming stocks, participations, certificates, or other marketable securities. These earnings are generally subject to a final flat tax of around 5%–6.25%, withheld at the source or paid directly via SUNAT’s online system.
Interest, royalties, temporary licensing of intangible assets, and similar earnings also fall under this category. These are typically reported and paid monthly through withholding or self-declaration. Capital gains from foreign securities may also be treated as Second Category income if the securities are registered and sold through approved markets (such as MILA: Mercado Integrado Latinoamericano). Otherwise, they are added to employment income instead.
Third Category
Third category income includes all income earned from business activities, whether by individuals or companies. This category covers commercial, industrial, agricultural, mining, fishing, construction, transportation, financial, and service-based operations, as well as income from the habitual purchase and sale or exchange of goods. It applies to businesses such as hotels, garages, repair shops, banks, insurance companies, and similar commercial services.
It also includes income earned by professionals working through a civil association or legal entity, such as a law firm or architectural studio, as well as by intermediaries, notaries, and auctioneers. Profits from the third sale onward of real estate or other capital assets are also taxed under this category.
In some cases, income that might otherwise qualify as fourth category (freelance professional) is treated as third category when it is combined with commercial activity. Additionally, the free or underpriced transfer of depreciable assets (excluding real estate) between businesses is presumed to generate taxable income equal to at least six percent of the acquisition or construction value.
All legal entities domiciled in Peru are subject to third category tax, as are institutions such as private schools, investment trusts, and fiduciary funds when operating as a business. The standard corporate income tax rate for third category income is 29.5 percent. Companies must also submit monthly advance payments and maintain formal bookkeeping and invoicing.
SUNAT applies the presumption that business assets are transferred for the full tax year unless the taxpayer can prove otherwise.
There is no deduction allowed for accumulated depreciation when calculating presumed income from underpriced or free transfers.
Fourth Category
Fourth category income refers to income earned from providing independent professional services. This includes the practice of any profession, art, science, or trade performed individually and without an employment relationship. Typical examples are lawyers, doctors, consultants, engineers, artists, and translators. These services are carried out independently and are not subject to labor law protections.
This category also includes payments received for specific roles such as company directors, trustees, legal representatives, municipal councilors, or regional advisers. These payments are often referred to as “dietas” and are taxed as fourth category income.
Most independent professionals are required to issue electronic service receipts (Recibos por Honorarios Electrónicos). Since 2017, this rule applies to nearly all cases, with exceptions for individuals who earn income through formal legal roles such as directors or trustees.
Fourth category income is taxed progressively, usually between 8% and 30%. If monthly income exceeds S/ 3,609, an 8% advance tax must be paid each month. When a person combines professional services with commercial business activities, the total income may be reclassified as third category income.
Fifth Category
Fifth category income refers to earnings from dependent work, including all compensation received by employees under an employment contract. This includes salaries, wages, bonuses, commissions, allowances, holiday pay, and any other form of payment for personal services provided under an employer’s direction. Public officials’ compensation is also included.
To be classified as fifth category income, there must be a clear employment relationship involving subordination and direction by the employer. Life annuities and pensions derived from personal work are also considered fifth category income, although these are not subject to income tax under Article 18(d) of the Peruvian Income Tax Law.
This category also includes profit-sharing bonuses distributed by companies, regardless of whether they are annual or provided in another form. If a person is both an employee and a service provider to the same company, income from both roles may be taxed under this category.
Income received by partners or shareholders of companies for services rendered under an employment relationship is also treated as fifth category income. However, if the owner of a sole proprietorship assigns themselves a salary, it is not considered fifth category income but third category business income.
Certain benefits are excluded from taxation under this category. These include general company expenditures for employee health assistance or travel expenses such as per diems, meals, accommodation, and transportation costs—provided they are duly documented and justified. If not, they may be considered freely disposable income and become taxable
Taxes in Peru for S.A.C. Owners with a Work Visa
If you’re an expat who formed a S.A.C. (Sociedad Anónima Cerrada) to obtain a work visa, special tax obligations apply:
1. The S.A.C. as a legal entity
A S.A.C. is taxed like any other company in Peru:
Subject to third category tax at 29.5% on annual net income
Required to file monthly declarations and an annual tax return (Form 710)
Obliged to issue electronic invoices and maintain proper accounting
2. The shareholder as employee
If you’re drawing a salary from your own S.A.C., you’re considered an employee for tax purposes:
Your income is taxed under fifth category rules (progressive 8–30%)
The S.A.C. must withhold and pay income tax and EsSalud contributions (9%) monthly
A formal employment contract is required
3. Even with no profit: Declarations required
If your S.A.C. is not generating income, it still needs to file monthly “zero declarations” (sin movimiento). If a salary is paid, tax and social security must still be reported and paid.
Failing to do so can result in fines—even if the company is inactive.
Feeling overwhelmed? Too much information? Too complicated?
Taxes are not everyone’s cup of tea—and they don’t have to be yours. If you decide to work or start a business in Peru, we provide full tax and accounting services tailored to your situation and budget. From monthly declarations to annual filings, we make sure everything is done right and on time. You focus on growing your business—we’ll take care of the rest.
Do you need clarity on taxes in Peru?
Book a private consultation with Sergio Vargas and get professional and personalized advice.
- Duration: Max. 60 minutes
- Cost: US$ 159
- Language: English or Spanish
- Format: Zoom Call
- Tax assessment and legal advice
Don’t miss out on important updates!
Subscribe to our Substack newsletter and get the latest articles on immigration, taxes, and real estate in Peru delivered straight to your inbox.
