General Taxes for Business in Peru

Establishing a business in a foreign country can seem daunting at first, having to understand a new taxing system , the statutory requirements for foreigners, and how to operate your business with due diligence. Peru is one of the most stable countries in Latam due to years of consistent macroeconomic policies in addition to policies that protect and welcome foreign investment.

The general taxes that apply to businesses in Peru are the Income Tax, General Sales Tax, and Selective Consumption Tax. However, the government has established tax benefits and exceptions for businesses that operate in special industries that are considered important in accordance with the country’s policies.

Income tax:

The income tax applies to income that originates from work and the productive usage of capital, whether it’s a movable or immovable property. Income tax rates vary depending on the type of income and how much that income is. In addition, this tax is levied via withholdings or directly carried out by the taxpayer

The income tax is levied on the yearly income, and it’s effective from January 1st to December 31st.

The income tax in Peru is divided into 5 categories:

• First category: Lease, sublease.

• Second category: Interest on loans, patents, royalties, capital gains.

• Third category: Income from commerce and industry.

• Fourth category: Independent work.

• Fifth category: Dependent work.

Business operations fall under the third category. This Income Tax is levied on the income obtained from business activities carried out by any natural or legal person, at 29.5% of annual net profit in the General Regime; companies in the MYPE Tax Regime pay 10% on the first 15 UIT of net profit and 29.5% on the rest (see tax regimes in Peru). Generally, this income is produced by the joint participation of capital investment and labor. The formula to calculate this tax is established by Peru’s tributary entity.

To understand how to calculate income tax in Peru, it’s important to be familiarized with UIT units. UIT stands for ‘Unidad Impositiva Tributaria‘ (Tax Unit).  Peru’s tributary entity, SUNAT, utilizes tax brackets expressed in UIT units to determine how much small, medium, and large businesses should be taxed.

The government sets the UIT every year. For 2026 it is S/ 5,500 (Supreme Decree 301-2025-EF).

General Sales Tax (IGV)

The General Sales Tax in Peru applies to commercial activities , the sale of goods, the import of products, construction contracts, and the sale of property when it’s sold for the first time. Whoever is on the receiving end of the goods or services is taxed.

The standard rate is 18%: 16% IGV plus the 2% Municipal Promotion Tax (IPM).

Taxes in Peru: Law of the Amazon

This is an example of exemptions or benefits that the government has established to boost economic activities in certain regions of the country.

The sale of goods, provision of services, and construction contracts that are carried out in the Peruvian Amazon and that concentrate on specific activities, with taxpayers established in the region are exempt from IGV under the Amazon Investment Promotion Law (Law 27037, extended to 2048 by Law 30896).  The taxpayers must meet certain requirements such as having a fiscal address, administration, and production in the Amazon. Furthermore, they must keep all accounting books accordingly and have at least 70% of their fixed assets in the region as well.

If your business operates in Amazon, you may be eligible to benefit from this tax exemption. Nevertheless, it’s important to contact a local accountant that will provide you with detailed information.

Selective Consumption Tax (ISC)

SUNAT defines ISC as an indirect tax that only applies to particular goods. The purpose of this tax is to discourage the consumption of products that are considered to cause negative externalities to the individual, social and environmental order.

The second purpose of this tax is what the tributary entity describes as mitigation. Through this tax, they seek to mitigate IGV tax’s regressivity by demanding a higher tax burden from those consumers who objectively show higher acquisition capacity of items such as luxury goods.

Depending on the product, it is charged as a percentage of the price, as a fixed amount per unit, or as a percentage of the retail price.

Some products that are subject to ISC are:

• Cigarettes

• Fuel

• Vehicles

• Beers

• Mineral water

• Alcoholic beverages

• Bets and luxury items.

Other taxes

• Tax on Dividend

Dividends and any other form of profit distribution , also including remittances of net profits from Peruvian branches, are subject to a 5% withholding when they are paid to individuals or to non-resident shareholders, including foreign parent companies.

Resident companies that receive dividends are exempt from this tax in Peru.

• Tax on Royalties

A royalty is considered as a Peruvian source of income when the goods or rights that generated this payment are used economically in the country or when a domiciled natural or legal person pays these royalties.

• When a natural person receives this royalty, it is second-category income for a resident individual, and royalties paid to non-residents are subject to a 30% withholding.

• When a legal entity receives the royalty, it’s considered a third-category income, and the tax rate is calculated accordingly.

• Special Income Tax Regime

Small businesses with commercial, industrial or service activities and annual revenue up to S/ 525,000 can opt for the Special Income Tax Regime (RER). Under this regime, the Income Tax is equivalent to 1.5% and the General Sales Tax is equivalent to 18%. It’s important to consult with a local accountant to have the details of this regime.

Other taxes to know in 2026

• ITF: a 0.005% tax on most bank account debits and credits.
• ITAN: companies in the General Regime and the MYPE Tax Regime with net assets above S/ 1 million pay 0.4% on the excess, creditable against income tax.
• Electronic invoicing: companies issue invoices and receipts electronically through SUNAT’s systems.
• Payroll: employers withhold employees’ income tax and pension contributions and pay EsSalud health contributions.

Get help from Easyco

Easyco coordinates company formation in Peru up to the issue of the RUC, and supports companies afterwards with tax, accounting, payroll and legal representation. Read how to set up a company in Peru, or contact us to discuss your project.

Easyco also provides:

• Appointment of a legal representative
• Providing a registered office address
• Handling tax and accounting
• Payroll and employer of record services
• Support with your corporate bank account opening
• Trademark registration with INDECOPI
• Recruiting and hiring