Software houses, studios and service exporters in Argentina can cut corporate tax by up to 60% and turn most of their payroll charges into a tax credit until 2029. Here are the conditions, the real benefits and costs, what changed in 2024–2026, a worked example — and when a Paraguayan company does the job better.
Argentina’s Régimen de Promoción de la Economía del Conocimiento — the knowledge-economy promotion regime, usually shortened to “LEC” — is the main reason software houses, studios and service exporters keep large teams in Buenos Aires, Córdoba and Rosario despite the country’s tax load. Created by Law 27,506 in 2019, rewritten by Law 27,570 in 2020 and regulated by Decree 1034/2020, it cuts Ganancias (corporate income tax) by 20–60% depending on size, turns 70–80% of employer social-security contributions into a tax credit, frees exporters from VAT withholdings and sets export duties on promoted services at zero.
As of November 2026 the regime is in force and unchanged in substance by the Milei government, which has reorganised its administration and tightened the procedure rather than cut the benefits. It runs until 31 December 2029. It is only available to an Argentine legal entity, so a foreign group needs a local subsidiary — and should compare that with simply running the work from Paraguay.
Law and practice: Law 27,506 (2019), arts. 1–20, as amended by Law 27,570 (Boletín Oficial 26 October 2020); Decree 1034/2020; duration in art. 20.
| Promoted activity (art. 2) | Typical businesses |
|---|---|
| Software and digital services | Software development, SaaS, IT services, cloud, cybersecurity, data and AI services |
| Audiovisual production and post-production | Film, animation, video games, digital content |
| Biotechnology, bio-economy, biology, biochemistry, microbiology, genetics, neuroscience | Lab services, biotech R&D, ag-biotech |
| Geological, prospecting and related electronic and communications services | Exploration services, telecom engineering |
| Professional services, only when exported | Legal, accounting, design, engineering, advertising, consulting billed abroad |
| Nanotechnology and nanoscience | Materials, sensors |
| Aerospace and satellite industry, space technology | Satellites, components, ground systems |
| Nuclear engineering | Engineering and services |
| Industry 4.0 automation, robotics, internet of things, sensors, additive manufacturing, augmented and virtual reality | Industrial automation, IoT and robotics integrators |
The beneficiary must be a legal entity incorporated in Argentina — an SAS, SRL or SA, for example — that is up to date with its tax and social-security obligations. Individuals are out, including those under the monotributo (the simplified regime for small taxpayers) and individual responsables inscriptos (VAT-registered taxpayers). Software developed for the company’s own use or for related companies does not count, and professional services count only when exported.
For a foreign group the practical consequence is simple: the regime attaches to the Argentine company, not to the group. A foreign parent can own all of it after registering under article 123 of the companies law; see our guide to opening a company as a foreign shareholder.
Law and practice: Law 27,506, arts. 2, 4 and 5.
First, at least 70% of the company’s total turnover in the last year must come from promoted activities. A company that also resells hardware, or has a large local consulting practice, must check the split; the authority looks at invoicing by activity code.
Second, the company must meet at least two of three further conditions. Training and R&D count together as one option, so a company can satisfy that leg with either.
| Condition (two of three) | Micro | Small and medium | Large |
|---|---|---|---|
| 1. Quality: continuous improvement or a recognised quality standard (for example ISO 9001) | Required | Required | Required |
| 2a. Training spend, % of payroll | 1% | 2% | 5% |
| 2b. or R&D spend, % of turnover | 1% | 2% | 3% |
| 3. Exports of promoted activities, % of turnover | 4% | 10% | 13% |
For most exporting software companies the easy pair is exports plus quality or exports plus training. Micro companies less than three years old can register by showing only that they carry out a promoted activity, and the authority may ask for evidence that it is a business model rather than a one-off project.
Registration is not permanent. Beneficiaries file an annual compliance report and revalidate every two years, and must not reduce headcount: cutting staff for more than 60 days, employing unregistered workers or appearing in the public register of labour-law offenders (REPSAL) triggers automatic loss of benefits.
Law and practice: Law 27,506, arts. 4, 6 and 15 bis; Resolution 268/2022 as amended in 2024 and by Resolution 67/2025.
The percentages depend on the company’s category under the Certificado MiPyME (the small and medium enterprise certificate), which is requested from the SME authority with the company’s tax login. For services, the categories are set by annual sales — the average of the last three years, net of VAT and internal taxes, and after deducting 75% of exports.
| MiPyME category, services sector (from April 2026) | Annual sales limit | Ganancias reduction |
|---|---|---|
| Micro | ARS 374.06 million | 60% |
| Small (pequeña) | ARS 2,255.11 million | 60% |
| Medium, tranche 1 | ARS 18,664.74 million | 40% |
| Medium, tranche 2 | ARS 26,655.99 million | 40% |
| Large (above medium, or no MiPyME certificate) | — | 20% |
That export deduction matters more than founders expect. A services company invoicing US$2 million a year (about ARS 3,036 million at ARS 1,518 per dollar) is medium-sized if it sells locally, but if 80% of that is exported its measured sales fall to about ARS 1,214 million and it becomes small — moving from a 40% to a 60% income-tax reduction. A lapsed certificate means the large-company rate.
Law and practice: Secretariat of Industry, Commerce and SMEs Resolution 1/2026 (limits from 1 April 2026); Law 27,506, art. 10.
| Benefit | What the law gives | Practical note |
|---|---|---|
| Ganancias (corporate income tax) | Tax on promoted activities cut by 60% (micro and small), 40% (medium) or 20% (large), on Argentine and foreign-source income | Applied in the annual return once ARCA has the company flagged as a beneficiary |
| Bono de crédito fiscal | Up to 70% of employer social-security contributions on staff in promoted activities; 80% for certain new hires | Pays VAT and other national taxes for 24 months (+12); exporters can use it against Ganancias up to their export share |
| VAT withholdings and perceptions | Exporters of promoted activities are not subject to them | Stops cash being trapped in VAT credits; needs the ARCA certificate |
| Foreign withholding tax | Tax withheld abroad on the company’s income can be deducted as an expense | Useful when Latin American clients withhold on fees |
| Export duties on services | 0% for registered beneficiaries | Set by Decree 1034/2020; services duties in general lapsed from 2022 |
| Stability | The regime’s benefits cannot be cut while the company stays registered and compliant | Covers the regime’s own benefits, not the whole tax system |
| Export proceeds (“dólar tecno”) | 30% of FX from net incremental exports freely available, to pay staff | Decree 679/2022; less valuable since employees can buy dollars freely |
The income tax cut applies to the tax determined on promoted activities, not to the rate itself, and it applies to foreign-source income as well. With the 2026 corporate scale of 25%, 30% and 35%, a small company paying 29% before the cut pays around 11–12% after it; a large one at 35% pays 28%. Dividends still bear the 7% withholding on the way out.
The bono de crédito fiscal (tax credit bond) is calculated monthly on the employer contributions actually paid for staff working in promoted activities, from the payroll return (form 931). It cannot be refunded in cash, can be transferred only once and only by companies exporting at least 70%, and lasts 24 months, extendable by 12. It pays VAT and other national taxes; only exporters can use it against Ganancias, and only up to their export percentage. The 80% rate applies to certain new hires — women, people with disabilities, science and engineering postgraduates, residents of less-developed areas — if headcount rises.
VAT withholdings. Exporters of promoted activities receive a certificate that stops clients and banks withholding or collecting IVA (VAT) in advance.
Law and practice: Law 27,506, arts. 7–12 as amended by Law 27,570; Decree 1034/2020; Decree 679/2022 (30% of incremental export proceeds). Corporate scale: Law 27,630 and the ARCA scale for 2026.
Verification fee
Up to 4% of the benefits obtained, for audit and control. Resolution 67/2025 set it at 0% until 31 December 2025; confirm the rate for 2026 when you file.
FONPEC contribution
Up to a further 4% of benefits into the knowledge-economy trust fund, which finances programmes such as Kit 4.0 for SME digitalisation.
Audits
Benefits are audited; the company has 10 business days to accept or reject the final technical report, and silence counts as acceptance.
Late filings
A late annual report or biennial revalidation suspends the bono; since 2025 benefits restart only from the date the company catches up.
Sanctions
Suspension for 3 months to a year, removal from the register, repayment of the tax saved with interest, return of the bonos and fines up to 100% of the benefit.
Fiscal quota
The bono is paid out of an annual budget quota; the 2024 quota was used up and late applicants lost those months.
The quota point is the one to plan around. Since Resolution 67/2025, bonos are issued from the month after the registration is notified, looking back at most four months of payroll within the current budget year. A company that files in November and is approved in March does not recover the months in between. File early in the year.
Law and practice: Law 27,506, arts. 13, 15, 15 bis and 18; Resolution 67/2025 (Boletín Oficial 8 May 2025), arts. 2–4; Decree 594/2024 (2024 quota); Resolution 8/2026 (Kit 4.0).
Who runs it
The Ministry of Economy is the enforcement authority; since the 2026 reorganisation the Undersecretariat of Industry and Knowledge Economy handles approvals, bonos and sanctions (Resolution 273/2026, August 2026).
Paperwork, 2024
Registration in the productive-matrix register (RUMP) was dropped, a sworn statement replaced the accountant’s certificate in some cases, and the 80% bono for new hires became automatic once the hire appears on form 931.
Bono timing, 2025
No more retroactivity to the filing date; the 2024 quota exhausted; 0% verification fee for 2025.
Labour reform, 2026
Law 27,802 cut employer contributions to 5% for qualifying new hires until April 2027. The bono is a percentage of contributions paid, so those hires generate a much smaller bono.
Tax reform
The flat 25% corporate rate floated in 2026 is not law; if it arrives, the regime’s percentage cuts would apply to a lower base.
Buenos Aires City
The City runs its own knowledge-economy register; since February 2026 applications and renewals are filed between 1 January and the end of February.
Two things did not change. The regime still ends on 31 December 2029, and it is not the same thing as the Ley Bases incentives: the large-investment regime created by Law 27,742, RIGI, is a separate tool for projects of US$200 million or more in a single-purpose vehicle. The 2026 RIMI regime for mid-size investments is a third, separate route; both are covered in our RIGI and RIMI guide.
Law and practice: Resolution 1419/2024 (delegation); Ministry of Economy Resolution 114/2024 (RUMP); Decree 146/2026 and Decree 215/2026 (reorganisation); Law 27,802 (2026); Buenos Aires City Investment Undersecretariat Resolution 2/2026 (Boletín Oficial 10 February 2026).
Take an Argentine SAS owned by a foreign parent: US$2 million of revenue, 80% billed to US clients, gross payroll of US$1 million and a taxable profit of US$500,000 (about ARS 759 million at ARS 1,518 per dollar). Under the 2026 scale, Ganancias before any incentive is ARS 33.4 million plus 30% of the excess over ARS 133.5 million: about ARS 221 million, or US$145,600 — 29.1% of profit.
| US$2m software company, US$500,000 profit | General regime | Regime, medium (no exports) | Regime, small (80% exported) |
|---|---|---|---|
| Ganancias before reduction (2026 scale) | about US$145,600 (29.1%) | about US$145,600 | about US$145,600 |
| Reduction | — | 40% | 60% |
| Ganancias payable | about US$145,600 | about US$87,400 (17.5%) | about US$58,200 (11.6%) |
| 7% on dividends, all profit paid out | about US$24,800 | about US$28,900 | about US$30,900 |
| Tax on profit and dividends | about US$170,400 (34.1%) | about US$116,300 (23.3%) | about US$89,100 (17.8%) |
| Bono (70% of about US$180,000 employer contributions) | — | about US$126,000, against VAT and other national taxes | about US$126,000; up to 80% of it also usable against Ganancias |
Three things drive the result. The export deduction makes the company small rather than medium, worth an extra 20 points of reduction. The bono — about US$126,000 a year on roughly US$180,000 of employer contributions at the 18% SME rate — is larger than the whole Ganancias bill, and because the company exports 80% it can use up to 80% of the bono against Ganancias and the rest against VAT on its local sales. And the 7% dividend tax is not reduced at all.
Put together, the national tax on profit and dividends falls from about 34% to under 18%, and the bono offsets most of what remains in cash. What the regime does not touch: the cheque tax on bank movements, Ingresos Brutos (provincial turnover tax) on local sales, municipal levies and the cost of the cepo (the remaining FX controls) on getting profits out.
Law and practice: Illustrative; MiPyME category from three-year average sales; employer contributions at the 18% rate before deductions; ignores any income-tax effect of the bono, the cheque tax and Ingresos Brutos. Exchange rate as in our 2026 tax reform guide.
Argentine SAS, SRL or SA with its CUIT and employer registration; foreign parent registered under article 123.
Request it with the company’s tax login; it fixes the reduction percentage.
Turnover by activity (70% test), export share, training or R&D spend, quality certificate if used.
Online application through the government’s remote filing platform (Trámites a Distancia).
Once registered, ARCA flags the company for the Ganancias cut, the bono and the VAT certificate.
Annual report, revalidation every two years, no headcount cuts, audits.
If Paraguay charges 10% corporate tax, why build in Argentina at all? The answer is people. The regime makes a large Argentine team affordable; it does not make Argentina a cheap place to book profit.
| Same business, US$500,000 profit, foreign owner | Argentine subsidiary in the regime (small) | Paraguayan EAS, ordinary regime | Paraguayan services maquila |
|---|---|---|---|
| Profit tax | about 11.6% after the 60% cut | 10% IRE | 1% single tax on the greater of export invoices or local value added |
| Dividends to a foreign owner | 7% | 15% IDU | Exempt from IDU |
| VAT on invoices to foreign clients | None (export) | 10%, a real cost to the client | None |
| Payroll subsidy | Bono: 70–80% of employer contributions | None | None |
| Employer cost on a salary | about 1.37× gross before the bono | about 1.25× gross | about 1.25× gross |
| Other taxes | Cheque tax, Ingresos Brutos, municipal levies | None of these | None of these |
| FX | Export proceeds sold locally; dividends from 2025 profits payable | Free | Free |
| Sunset | 31 December 2029 | Permanent | Programme-based |
Open the Argentine subsidiary when the team is the asset: twenty or more developers, designers or engineers whose skills you cannot hire in Asunción, and a business that bills mostly abroad. The bono turns Argentina’s heavy payroll charges into a credit, and the reduced Ganancias brings the profit tax close to Paraguayan levels. Accept the FX rules and the 2029 sunset.
Use a Paraguayan company when the work is done by a small team, by the founder, or by people who can live in Paraguay, and when profit should stay in dollars without the MULC (official FX market) in between. Mind the 10% VAT on exported services unless you qualify for services maquila, as explained in our Paraguay software guide. Combining the two — a Paraguayan parent with an Argentine development subsidiary — works, but there is no tax treaty and Argentina treats Paraguay as a low-tax jurisdiction, so every intercompany fee needs transfer-pricing support.
Law 27,506, consolidated text (InfoLEG / argentina.gob.ar) · Law 27,570 (Boletín Oficial, 26 October 2020) · Resolution 67/2025, Ministry of Economy · Resolution 8/2026, Ministry of Economy (Kit 4.0, FONPEC) · Decree 1034/2020 and the 0% export duty (El Cronista) · EY: Argentina ends export duties on services (2021) · Allende & Brea: Decree 679/2022 (dólar tecno) · PRA Abogados: Resolution 67/2025 · Carranza Torres: 2024 procedural changes · MiPyME limits 2026 (El Cronista) · KPMG Argentina: tax news, March 2026
Law 27,506 of 2019, amended by Law 27,570 in 2020: a promotion regime for software, audiovisual, biotech, exported professional services, Industry 4.0 and other knowledge activities, in force until 31 December 2029.
The tax on promoted activities is cut by 60% for micro and small companies, 40% for medium and 20% for large companies, depending on the MiPyME certificate.
A tax credit equal to up to 70% of employer social-security contributions on staff in promoted activities, or 80% for certain new hires. It pays VAT and other national taxes for 24 months; exporters can also use it against income tax.
Yes, through an Argentine company. The regime requires an entity incorporated in Argentina; its shareholders can be foreign.
Registered beneficiaries pay 0% under Decree 1034/2020, and the general duty on services exports lapsed from January 2022.
At least 70% of turnover from promoted activities, plus two of three: quality certification, training or R&D spend, and exports above a minimum share of turnover.
For small teams and profit kept in dollars, often yes. For large teams of Argentine engineers billing abroad, the regime makes an Argentine subsidiary competitive.
10% VAT on exported services, services maquila at 1%, payments and hiring.
Article 123, SAS, SRL or SA, the CUIT and the bank.
Tell us what you build, where your people are and who your clients are. We model the Argentine regime against a Paraguayan company, handle the registration and keep the filings on time — fixed quote within one business day.
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