What Does It Really Cost to Run a Business With Employees in Uruguay in 2026?
INGAR · · Guides
Gross salary is not what an employee costs you.
For a salaried worker under the general Industry and Commerce regime, a company has to budget for the wage itself, employer contributions, the aguinaldo (a mandatory 13th-month bonus), vacation pay and compulsory workplace-accident insurance. Depending on the sector, the job category and the applicable collective agreement, other line items can show up too.
At the National Minimum Wage in force since July 2026, the equivalent monthly cost lands around $ 32,000 — before BSE (the state insurance bank) coverage and before whatever your particular line of business adds.
The current minimum wage
Decree 319/025 set two brackets for 2026:
| In force from | National Minimum Wage |
|---|---|
| January 1, 2026 | $ 24,572 |
| July 1, 2026 | $ 25,383 |
The decree's conversions: daily wage = monthly ÷ 25; hourly rate = monthly ÷ 200. They exist to convert the minimum wage into equivalent units; they do not imply that every job runs on a 200-hour month.
And one thing worth knowing before you build any budget: the national minimum is a general floor. Many workers are entitled to higher category minimums set by the Consejos de Salarios (the country's sector-level wage councils). Pin down the group, subgroup, category and binding wage scale before you project a hire.
Employee and employer contributions
Employee contributions come out of the worker's gross pay: they are not an extra cost to the company, even though the employer withholds them and remits them to BPS (Uruguay's social-security agency).
Employer contributions, on the other hand, are paid on top of the salary.
| Item | Employee contribution | Employer contribution |
|---|---|---|
| Pension | 15 % | 7.5 % |
| FONASA (the national health fund) | 3 % to 8 % | 5 % plus any CCM |
| Labor Retraining Fund (FRL) | 0.10 % | 0.10 % |
| Wage Claims Guarantee Fund (FGCL) | — | 0.025 % |
| Total employer contribution, general regime | — | 12.625 % plus any CCM |
Those are the general rates. Construction, farm work, domestic work and certain special activities operate under different regimes.
The employee share of FONASA
It depends on earnings and on family circumstances:
| Situation | Up to 2.5 BPC | Above 2.5 BPC |
|---|---|---|
| No dependent children, no dependent spouse or partner | 3 % | 4.5 % |
| Dependent children, no dependent spouse or partner | 3 % | 6 % |
| No children, dependent spouse or partner | 5 % | 6.5 % |
| Dependent children and dependent spouse or partner | 5 % | 8 % |
The 2026 BPC (Base de Prestaciones y Contribuciones, the benchmark unit used to index social benefits) is $ 6,864, which puts 2.5 BPC at $ 17,160: a worker earning the national minimum is already above that threshold.
When does the health-coverage top-up kick in?
The CCM (Complemento de Cuota Mutual, an employer top-up for health coverage) applies when the basic FONASA contributions fall short of the cost of health plan premiums for covered workers:
CCM = (covered workers × health plan premium) − basic employee and employer FONASA contributions
As of July 2026 the health plan premium is $ 1,820. In a simple case — one covered employee, a full month, $ 25,383 — the 3 % employee share plus the 5 % employer share come to roughly $ 2,031, so no CCM would arise.
The math changes with few days worked, partial earnings or a worker holding more than one job. The final figure shows up on the BPS bill.
Aguinaldo, paid leave and vacation pay
Three things that get mixed up constantly.
Aguinaldo. It equals one twelfth of countable cash earnings. On a fixed salary, accruing for it monthly amounts to adding gross salary ÷ 12. It triggers employer contributions for pension, FRL and FGCL, and it is exempt from the basic 5 % employer FONASA contribution.
Paid leave. A salaried worker draws their usual pay while on leave, so in an annual projection those twelve salaries already cover the days off. What does add cost is hiring someone to cover the absence, if the business needs it.
Vacation pay. This is not a second salary. The legal minimum is 100 % of the net daily wage for the days of leave. For a salaried worker with 20 days: net salary ÷ 30 × 20. It is exempt from social-security contributions.
Monthly cost of a minimum-wage employee
Assumptions: gross salary $ 25,383; salaried worker; general Industry and Commerce regime; 20 days of annual leave; no personal income tax on that salary; no CCM; no special collective-agreement items; BSE insurance not yet included.
| Item | Monthly equivalent |
|---|---|
| Gross salary | $ 25,383 |
| Employer contributions on salary (12.625 %) | $ 3,205 |
| Accrued aguinaldo | $ 2,115 |
| Employer contributions on the aguinaldo | $ 161 |
| Accrued vacation pay | $ 1,084 to $ 1,134 |
| Equivalent monthly cost | $ 31,949 to $ 31,998 |
In round numbers: an employee on the minimum wage costs about $ 32,000 a month, roughly 26 % above the gross figure — and that is still without BSE, without collective-agreement extras and without cover staff.
Budget three employees at their gross salaries and you are short by more than $ 20,000 a month.
BSE insurance
Every company with employees must carry workplace accident and occupational illness coverage through Banco de Seguros del Estado.
The premium depends on the activity, the risk profile and the company's characteristics: there is no single percentage. Get a quote for your specific line of business before you lock in a budget.
VAT: how it actually works
The standard rate is 22 % and the reduced rate is 10 %, with exempt transactions and special regimes on top of that.
But the key point is a different one: under the general regime, a company does not hand DGI (Uruguay's tax authority) 22 % of what it invoices. It calculates output VAT, subtracts deductible input VAT and pays the difference, along with any other credits and adjustments that apply.
That is why the real impact depends on the margin and on the business's purchasing structure, not on revenue. A retailer with thin margins and a lot of taxable purchases ends up with a very different VAT balance than a service provider with few inputs.
On top of that, not every small business files under the general regime: depending on their characteristics, some fall under minimum VAT, monotributo (a simplified single-tax regime for very small operators) or other treatments, each with its own rules.
IRAE: 25 %, but on what?
The general rate for IRAE (Uruguay's corporate income tax) is 25 % on net taxable income — the positive result left after revenue, costs, deductible expenses and tax adjustments. It is not 25 % of revenue.
Two clarifications that spare you an unpleasant surprise:
- A company with no profit does not always owe nothing: certain IRAE taxpayers have to make minimum advance payments.
- And not every small business files under the general IRAE regime; there are alternatives depending on revenue level and activity.
The actual filing is an accountant's job, and it is worth settling before you project the returns on a purchase.
Common myths
"Gross salary is what the employee costs." No. At the national minimum, the equivalent monthly cost runs around $ 32,000 against a gross of $ 25,383 — and that is before BSE.
"Employer contributions are 12.5 %." Under the general regime considered here they add up to 12.625 %: 7.5 % pension + 5 % FONASA + 0.10 % FRL + 0.025 % FGCL. The CCM may be added on top, and some activities fall under different regimes.
"Vacation pay is a second salary." It is not: it is the net daily wage for the days of leave.
"IRAE is 25 % of revenue." No: it applies to positive taxable income.
"Every business pays VAT at 22 %." No: some transactions are taxed at 10 %, some are exempt, some fall under special regimes, and under the general regime input VAT is deducted.
"If I publish the legal notices, I inherit no debt." No. Publication under Ley 2.904 limits liability, but the buyer can still be on the hook for debts on the books and for claims filed within the deadline — and there is also a specific tax liability that attaches to the successor.
Frequently asked questions
What does a minimum-wage employee cost?
On a gross of $ 25,383, between $ 31,950 and $ 32,000 a month under this article's assumptions. That covers employer contributions, the aguinaldo, contributions on the aguinaldo and vacation pay. It does not cover BSE, collective-agreement items, cover staff or special circumstances.
How much are employer contributions?
12.625 % plus any CCM, under the general Industry and Commerce regime.
Do employee contributions raise the employer's cost?
They are not added on top of the gross figure: they are withheld from the worker. But they do matter for calculating vacation pay, which is based on net pay.
Does a worker pay FONASA even without children?
Yes. The rate depends on earnings and family circumstances; above 2.5 BPC it ranges from 4.5 % to 8 %.
Is there always a CCM?
No. Only when the basic contributions fall short of the health plan premium for covered workers.
Does the aguinaldo trigger employer contributions?
Yes: pension, FRL and FGCL. It is exempt from the basic 5 % employer FONASA contribution.
Does vacation pay trigger contributions?
The legal minimum is exempt from social-security contributions.
Is BSE insurance mandatory?
Yes, for every company with employees. The premium depends on the activity and the risk profile.
Is IRAE always 25 %?
That is the general rate on positive taxable income. Depending on their characteristics, some businesses fall under minimum VAT, monotributo or other treatments.
Does the full price of a going-concern sale pay VAT at 22 %?
No. Each asset gets its own treatment, and positive goodwill is taxed at the standard rate, per DGI's criteria.
Does buying a business mean taking on its employees?
It depends on how the deal is structured and on whether the business continues as a going concern. Headcount, seniority, unused leave, wage claims and potential lawsuits all get reviewed before signing. Changing the name or the formal owner does not erase the obligations that come with a business succession.
How we handle this
We don't run payroll, and we don't stand in for your accountant, your escribano (Uruguayan notary) or your employment lawyer.
Our part is the real-estate and commercial side: assessing the premises and their lease, checking whether the rent allows the business to keep operating as it is, identifying which assets and rights are included in the goodwill, testing the asking price against demonstrable profitability, coordinating the transfer paperwork and flagging costs or contingencies that never show up in the initial projection.
When a business is sold with staff in place, labor cost is part of the valuation — not an afterthought. Seniority, job categories, wage scales, unused leave, BPS standing and BSE coverage all need a look.
If that information isn't available, there isn't yet enough to know what the goodwill is worth.
When you're working out whether a business can carry its payroll, it helps to benchmark against comparable deals: the businesses for sale we list show sector and scale.
Keep reading
- Taxes when buying or selling a business
- Buying a business without inheriting its debts
- Due diligence checklist before you buy
- How a business is legally transferred, step by step
- What is a business's goodwill worth?
- Buying a business: what to check in the premises lease
Sources
- MTSS — National Minimum Wage 2026 · Decree 319/025
- BPS — Contribution rates · FONASA and CCM rates · FRL · Wage Claims Guarantee Fund · Current values · Manual on taxable earnings
- MTSS — Paid leave rules · Sueldo Anual Complementario (the annual bonus)
- DGI — IRAE · Goods and services taxed at 22 % · Small-business regime vs. monotributo · Minimum VAT payment
- BSE — Workplace accident insurance
- Ley 2.904 · Ley 5.418 · Decree-Law 14.433 · Tax Code, article 22
General information current as of August 1, 2026. Category minimum wages, contributions, insurance, employment obligations and tax regimes should be confirmed for each company with the appropriate professionals.