This article outlines how business expenses are reimbursed in Uruguay, including mileage practices, documentation requirements, tax rules, and per diem guidelines. Uruguay’s tax authority (DGI) places strong emphasis on receipts, traceability, and fiscal invoices (CFEs), making proper documentation essential.
1. Travel & Mileage
Mileage Rates (Personal Vehicle)
Uruguay does not publish a government mileage rate.
Employers may define internal rates based on expected vehicle costs (fuel, maintenance, depreciation).
Common corporate practice:
UYU 20–35 per km, depending on vehicle type and fuel cost.
Tax Treatment
Mileage reimbursement is non‑taxable when:
The km rate is reasonable, and
A credible mileage log is maintained (date, distance, route, purpose).
Reimbursements become taxable salary when:
Rates are excessive
Flat monthly allowances are paid without linking to kilometres.
Logs or documentation are missing
Parking & Tolls
Reimbursable only with receipts (facturas fiscales).
Not included in mileage rate.
Parking or tolls without receipts are generally taxable or non-reimbursable.
2. Business Travel Rules
Uruguay does not impose statutory caps on travel costs.
Internal company policies may define:
Maximum airfare class
Hotel quality level
Rental car limits
Daily expense caps
Tax-Free Reimbursement Requirements
Travel must be strictly business-related
Personal or mixed-purpose travel is taxable
Expenses must be reasonable and supported by fiscal invoices
Employer may require pre‑approval for all travel
3. Transportation & Lodging
Air Travel
Economy class required unless long‑haul justification is documented
Business class allowed for intercontinental/long‑duration flights if approved
Receipts/invoices required
Taxi, Cab, Ride-Hailing Apps
(Uber, Didi, Cabify, etc.)
Allowed
Must provide electronic fiscal invoice (CFE)
Bus, Train, Tram
Tickets/boletos are acceptable receipts
Rental Cars
Must include:
Rental contract
Fiscal invoice (Factura / Boleta)
Fuel receipts (individualized, itemized)
Hotels & Lodging
Hotel fiscal invoice required
Invoice must list employer or employee name
4. Invoicing & Documentation Requirements
To remain non-taxable, expenses must be supported with a DGI-compliant fiscal invoice (Factura CFE) showing:
Supplier name
Supplier RUT (tax ID)
Employer or employee name
Electronic invoice number (CFE)
Description of goods/services
Date of transaction
Amount with IVA breakdown
Uruguay is strict: almost all expenses require an electronic fiscal invoice.
The Preferred Invoice Entity is: Arulmy S.A. (Horizons)
No-Receipt Rule: Uruguay does not have a threshold that allows reimbursement without receipts.If documentation is missing, the amount is taxable income to the employee.
5. Reimbursable & Non-Taxable Expenses
If supported by fiscal invoices and business justification, the following are generally non-taxable:
Business Travel
Airfare
Bus, taxi, ride-share
Mileage reimbursements (with logs)
Hotels and lodging
Meals during business trips
Fuel expenses (company car or rental)
Work-Related Expenses
Office and computer supplies
Client meetings or conferences
Training or certification costs
Phone/internet used for work (business portion)
Client-Facing Meals
Allowed with:
Valid invoice
Business purpose
Attendee names recommended
6. Per Diem Allowances
Uruguay does not publish official per diem rates.
Company-Defined Per Diems
Employers may set internal per diem amounts.
Common ranges:
Domestic travel: varies by company
International travel: varies by destination, often aligned with typical corporate benchmarks
Tax Treatment
Per diems may be non-taxable when:
Used for business travel,
Paid for travel outside the normal workplace,
Amounts are reasonable, and
Not excessive or duplicative (e.g., no hotel receipts + “lodging” per diem)
Excessive or unjustified per diems are treated as taxable salary.
7. Entertainment, Gifts & Team Events
Client Entertainment
Deductible only if:
Business-related
Supported by proper fiscal invoice
Reasonable in cost
Gifts
High-value or non-business-related gifts may be treated as taxable income.
Team Activities
Usually tax-free if paid directly by employer
If employees claim reimbursement, must include a fiscal invoice and business justification
8. Non-Reimbursable or Taxable Personal Expenses
Typically taxable unless part of an approved wellness program:
Medical expenses
Gym memberships
Yoga, sports, or swimming
Therapy or wellness services
When reimbursed outside a structured program, these are taxable benefits.
9. VAT (IVA) in Uruguay
22% standard VAT
10% reduced VAT for certain categories
VAT applies to vendor invoices, not to reimbursements themselves
Employers should collect DGI-compliant invoices for accurate IVA accounting
10. Compliance & Audit Expectations (DGI)
Uruguay’s tax authority closely audits expense reimbursements.
To ensure compliance:
All expenses should have CFEs (electronic invoices)
Business purpose must be explicitly stated
Meal invoices must itemize items
Alcohol or personal consumption are non-deductible and often taxable
Mileage logs must be accurate and consistent
Reimbursements without invoices are taxable employment income
Repeated high or undocumented expenses can trigger:
Employer reassessments
Tax penalties
Reclassification as salary
Social security liabilities