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The Monotax subsidy in Uruguay

The Monotax Subsidy in Uruguay

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The MIDES (Ministerio de Desarrollo Social – Ministry of Social Development) social monotax is a unified tax benefit replacing the special contributions related to social security in Uruguay and all national taxes in force, except for import taxes.

Target

Enable the formalization before the BPS (Banco de Previsión Social – Social Security Bank) and the DGI (Dirección General Impositiva – General Tax Directorate) of small enterprises, as well as of people in vulnerable households.

Access to the subsidy

Those who produce and market goods and those who provide services may access the subsidy, even if there is no combination of capital and labor, provided that the following conditions are met:

  • Those who live in vulnerable households, provided that a) they are part of poor households according to INEI (Instituto Nacional de Estadística e Informática – National Institute of Statistics and Informatics) or b) they are part of vulnerable households, according to Article 2 of Law No. 18,227 of December 22, 2007, and its regulations.
  • Produce, commercialize goods, or provide services, except domestic services and the construction industry.
  • Enterprises, both unipersonal and associative, as long as the latter does not exceed 5 persons as partners. Likewise, it must consider that there will be an income limit to access this, whereby these should not exceed the following:
    1. In the case of unipersonal companies: 60% of the limit established in paragraph E) of Art. 52 Title 4: 183,000 UI (Unidades Indexadas – Indexed Units).
    2. In the case of partnerships: 100% of the amount established in the aforementioned paragraph E): 305,000 UI.

It should be noted that to become a MIDES Social Monotributor, it will not be an impediment to have a job or collect a retirement pension.

Benefits of the MIDES Social Monotax

When accessing this monotax, the following benefits will be available:

  • Access to social security benefits, retirement, or health insurance.
  • Contributions will only be paid when you have a job.
  • They may sell to private companies, as well as to the State.
  • The payment is made progressively, with 25% during the first twelve months of registered activity, 50% in the following twelve months, and 75% in the third twelve months.

How to access the MIDES Social Monotax

To start the procedure, you must access the Ministry of Social Development’s website. Once you have done so, you must register in BPS-DGI.

MIDES Social Monotax and COVID-19

It should be noted that due to the effects of COVID -19 and the Sanitary Emergency, during 2020, the National Development Agency granted the holders of unipersonal companies or partners of de facto partnerships registered in the MIDES Social Monotax regime a subsidy of $6,779.00.

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