Uruguay Social Contributions Guide 2026

Overview — BPS Social Security System

Uruguay's social security system is administered by the BPS (Banco de Previsión Social). It operates on a pay-as-you-go (PAYG) basis supplemented by individual capitalization accounts through AFAPs (Administradoras de Fondos de Ahorro Previsional). Both employees and employers make mandatory contributions covering pensions, healthcare (FONASA), and other social benefits.

Employee Contributions — 15% + Up to 3% Additional

Employees contribute a total of 15% of gross salary, deducted directly from payroll. For 2026:

• BPS pension contribution: 12.5% — funds the public pay-as-you-go pension system (mixed with AFAP individual accounts)
• Health contribution (FONASA): 2.5% — funds the national health system (Fondo Nacional de Salud)
• Additional health contribution: Up to 3% for higher-income employees (applied progressively on income above certain thresholds)

For an employee earning UYU 80,000/month gross, the monthly employee deduction is approximately UYU 12,000 (15%). Higher earners may pay up to 18% total including the additional health surcharge.

Employer Contributions — 12.5%

Employers pay social security contributions totaling 12.5% of each employee's gross salary:

• BPS pension contribution: 7.5% — employer share of the pension system
• Health contribution (FONASA): 5% — employer contribution to the national health fund
• FRL (Fondo de Reconversión Laboral): 0.125% — funds labor retraining and unemployment programs

The total employer cost for an employee with UYU 80,000/month gross salary is approximately UYU 10,000 in employer contributions (12.5%).

FONASA Health Coverage

The FONASA (Fondo Nacional de Salud) system provides healthcare coverage through mutualistas (private healthcare providers). Employees and their dependents are covered under the system:

• Employee contribution: 2.5% of salary (plus up to 3% additional for higher incomes)
• Employer contribution: 5% of salary
• Coverage: Employee, spouse/partner, and dependent children
• Choice of provider: Employees can choose their mutualista (healthcare provider) from those registered with FONASA

Self-Employed Contributions

Self-employed individuals (trabajadores independientes) must register with BPS and make monthly social security contributions based on their declared income category. For 2026:

• Minimum contribution: Based on a minimum notional income set by BPS
• Rate: Similar proportional rates apply to declared income (approximately 25% total covering pension and health)
• Filing: Monthly declarations through the BPS online portal

FAQs

What is the difference between BPS and AFAP?

BPS (Banco de Previsión Social) administers the public PAYG pension system. AFAPs (Administradoras de Fondos de Ahorro Previsional) are private pension fund managers that manage individual capitalization accounts. Uruguay has a mixed system where a portion of the 12.5% employee pension contribution goes to BPS and a portion to the AFAP of the worker's choice.

Can I opt out of the Uruguayan social security system?

No, contributions are mandatory for all registered employees and self-employed individuals. There is no opt-out mechanism.

Do foreign employees in Uruguay pay BPS?

Yes, foreign employees working in Uruguay under a local contract are subject to the same BPS contributions as Uruguayan nationals. Employees on short-term assignments may be exempt under totalization agreements with certain countries.

Disclaimer

This guide provides general information about Uruguayan social security contributions for 2026. Rates and thresholds may change. Always consult a qualified Uruguayan contador or BPS directly for advice specific to your situation. InvestmentKit does not provide tax or legal advice.