Argentina

*Updated July 2020* 

Quick links

• Legal system
• Inheritance and succession
• Estate planning
• Taxation
• Residence and domicile
• Other relevant information

Legal system

Civil Law.

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Inheritance and succession

Succession

Forced heirship, see below.

Family law and defined inheritance rules

Property, estates and probate are ruled by the 2015 Civil and Commercial Code (the Code) (which entered into force on 1 August 2015 and replaced the previous Civil Code and Commercial Code that were more than 100 years old). The forced-heirship rule was reduced, but still provides that only a minor portion of the assets can be disposed by a will. The main forced portions are: 

• 66 per cent of the assets for the sons and daughters, no matter if there is one or several (used to be 80 per cent).
• If there are no sons or daughters (or descendants of them) to take as heirs, 50 per cent of the assets must go to the parents (used to be 66 per cent).
• If there are no descendants or parents as heirs, 50 per cent of the assets must go to the spouse (apart from any asset that belongs to them due to the matrimonial rules and a portion of certain assets that are attributed to the spouse, even if there are descendants or parents). Siblings have no forced portion.

Probate process

The applicable law of probate is determined by the last domicile of the person who was the owner of the assets under such process, with the exception of real estate that is ruled by Argentine law. 

Mental capacity

Section 11 of National Law No. 26,529 and s.60 of the Code provides that a person could issue anticipated directives to consent or reject certain medical treatments and other decisions in relation to their health.

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Estate planning

Use of trusts in estate planning

Local testamentary trusts are almost unknown. The growing exception is local trusts in favour of children with special needs. Nevertheless, high-net-worth individuals (HNWIs) use foreign trusts for asset protection and estate planning.

Use of foundations in estate planning

There are no private interest foundations in Argentina. Nevertheless, HNWIs use foreign foundations for asset protection and estate planning. The use of foreign foundations is being reduced, in favour of foreign trusts.

Types of entities

There are two main legal entities used as business vehicles:

• Sociedad Anonima (SA) corporations: essentially commercial corporations, with their capital represented by shares.
• Sociedad de Responsabilidad Limitada (SRL): a hybrid between a partnership and a company limited by shares (but closer to the latter). It serves the same purposes as an SA, but with fewer formal requirements.

Two new legal entities that are not so common but growing in use, are the SAS (a simplified SA) and the SAU (an SA with only one shareholder)., which are becoming more widespread

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Taxation

Income tax system

Argentina has a federal income tax paid on a worldwide basis for residents and source income for non-residents.

Personal income tax rates

Individuals are subject to rates that range from 9 per cent to 35 per cent (in practice, most taxpayers are subject to 35 per cent).

Corporate income tax rates

Legal entities are subject to a flat 30 per cent tax rate (2018 and 2019) and will then be subject to a flat 25 per cent tax rate (2020 onwards).

Capital gains tax

Both ordinary income and capital gains are subject to the same rates. Sale of securities is subject to a reduced 5 and 15 per cent tax rate. Listed securities are exempted.

Non-residents

Payments of interests, royalties and other Argentine-source income are subject to withholding. Capital gains of non-residents are taxed at 15 per cent tax rate over the net value or 13.5 per cent over the total price.

Withholding tax rate (non-treaty)

These are the main withholding rates if a tax treaty is not applicable:

Withholding tax rate (treaty)

Argentina has double taxation treaties (DTTs) with Australia, Belgium, Bolivia, Brazil, Chile, Canada, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Mexico, Russia, Spain, Sweden, Switzerland, the UAE and the UK. Those treaties that provide caps to withholding are listed on the table below.

DTTs in force

Taxation at death

There is no gift/estate tax at federal level in Argentina. There are gift and estate taxes in Buenos Aires and Entre Ríos provinces (Argentina has 23 provinces and a federal district). Court fees vary according to the province, but most of them are in the region of 3 per cent.

Other taxes

As a general rule, Argentine tax residents are taxed on their worldwide assets at the general rates of 0.25 per cent (from 2018), and foreign tax credits are available. There is an exception that determines that foreign individuals who stay in Argentina for less than five years for labour reasons must not include assets located abroad in their tax basis.

Tax treaties

NOT APPLICABLE

Tax information exchange agreements (TIEAs)

Argentina has signed TIEAs with several countries and is a signatory (and early adopter) of the multilateral OECD agreements.

The Argentine tax authority (the Authority) has issued a whitelist (first made publicly available in January 2014). The whitelist includes many formerly blacklisted jurisdictions such as the Cayman Islands, Jersey and Guernsey. The full whitelist is available (in Spanish) on the Authority’s website. Any country not included in the whitelist shall be treated as ‘not cooperative’ for tax purposes. Accordingly, this would automatically trigger the undesirable tax treatment for ‘low- or no-tax jurisdictions’ under Argentinian domestic law.

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Residence and domicile

Special rules on becoming resident

Foreign nationals acquire Argentine tax residence when they stay in the country for more than 12 months, or they have obtained the permanent resident visa from the National Migration Bureau.

Special rules on ceasing residence

Argentine nationals acquire foreign tax residence when they stay in another country for more than 12 months, or they have obtained the permanent resident visa from another country.

Domicile concept for gifts and inheritance

Domicile is defined as the ‘main seat’ of residence and business. If the individual carries on their business in a place different from the place of residence, residence would prevail. In practice, the address declared for the national identification document (identity card) is particularly relevant.

Taxation of holdings by non-residents on death and of gifts

Only if located in Buenos Aires or Entre Ríos province, not in other provinces. 

Reporting/auditing requirements

NO.

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Other relevant information

Asset protection laws

NO.

Foreign currency restrictions

Argentina has foreign-exchange controls.

Foreign ownership restrictions

On 29 December 2011, Law No. 26,737 establishing the ‘Protection System of Argentine Rural Land’ became effective. Its Regulatory Decree Nº 274/2012 was published in the National Gazette on 29 February 2012. Although these restrictions were relaxed, there are still restrictions for the purchase of rural land by foreign beneficiaries. Foreign beneficiaries are free to hold surface rights.

AML/due diligence and other requirements and regulatory procedures for advisors

• To establish a trust
• For incorporation
• To open a bank account

In all cases, a know-your-client procedure should be carried out. In the case of trusts, banks require that all the settlors and beneficiaries be disclosed, and that in the case of legal entities, the ultimate beneficial owners are informed. 

Resolution No. 3312/2012 (the Resolution) establishes an annual reporting procedure and registration of transactions procedure applicable to trusts set up in Argentina and abroad. For trusts created abroad, the report shall be fulfilled by Argentine residents for fiscal purposes acting as trustees, settlors and/or beneficiaries of these trusts. Besides, Annex I (s.1.4) of the Resolution establishes that any entities created abroad similar to trusts shall be subject to the information regime.

Settlors must declare any trust created or amended, including information such as amount transferred, name and data of the trustee and beneficiaries, kind of trust, place of location, tax identification number, etc. Any transfer of property to a trust by a settlor that is a tax resident in Argentina is subject to the information regimen, including transfer of assets that are located outside of Argentina. Beneficiaries must declare any benefit they receive from the trust and all the information they have regarding the trust and the trustee.

Key resources for further information

PUBLICATIONS

• Nicolas Malumian, Trusts in Latin America, New York, Oxford University Press, 2009 
• Nicolas Malumian, ‘A Good Way to Do Business’, STEP Journal (Vol18, Iss1, p21) 
• Nicolas Malumian, ‘Forced heirship’, STEP Journal (Vol19, Iss2, p45)
• Nicolas Malumian, ‘Recognition of foreign trusts’, STEP Journal (Vol18, Iss6, p21).

WEBSITES

• National Securities Commission (Comisión Nacional de Valores): www.cnv.gob.ar
• National laws and regulations information service: www.infoleg.gov.ar
• Argentine tax authority: www.afip.gob.ar

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STEP branches in Argentina

There is not currently a STEP branch in Argentina, but we do have branches in other countries in the Latin America region:

• STEP Belize
• STEP Brazil
• STEP Colombia
• STEP Mexico
• STEP South America (Uruguay)
• STEP Panama

Firms in Argentina

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Members in Argentina

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