Tax Treaty Relief in Argentina

Which countries does Argentina have a double-tax treaty with?

Argentina has 23 comprehensive income-tax treaties in force, ratified under Argentine constitutional law and administered by ARCA (Agencia de Recaudacion y Control Aduanero, which replaced AFIP in late 2024). The official register at argentina.gob.ar lists: Germany (in force 1979), Australia (1999), Belgium (1999), Bolivia (1979), Brazil (1982, amended 2018), Canada (1994), Chile (2016), China (entered into force 26 November 2024), Denmark (1997), United Arab Emirates (2019), Spain (2013), Finland (1996), France (1981, amended 2007), Italy (1983, amended 2000), Mexico (2017), Norway (2001), Netherlands (1998), Qatar (2021), United Kingdom (1997), Russia (2012), Sweden (1997), Switzerland (2015), and Turkey (2024). A treaty with Austria was ratified by the Argentine Senate in March 2026 under Law 27,803 but is not yet in force pending the exchange of ratification instruments. A treaty with Japan was signed in 2019 and a treaty with Luxembourg is signed but not in force. Notably, no income-tax treaty exists between Argentina and the United States. [1] Consult a qualified tax professional for the treaty position applicable to your specific facts.

What triggered the wave of treaty terminations and renegotiations?

Between 2008 and 2012 Argentina denounced four treaties it considered susceptible to abuse. The Argentina-Austria treaty of 1979 was terminated in 2008. In 2012, Argentina terminated its treaties with Spain, Chile, and Switzerland, citing alleged treaty shopping through conduit companies and the inability to collect the Personal Assets Tax (Bienes Personales) on Argentine-sited assets held through those jurisdictions. New, modernised treaties were subsequently concluded: Spain (signed 2013, in force 23 December 2013), Switzerland (signed 2014, in force 27 November 2015), and Chile (signed 2015, in force 11 October 2016). Each renegotiated treaty introduced updated anti-abuse language and confirmed Argentina's right to levy Bienes Personales on Argentine assets regardless of the treaty partner. Austria took the longest: a new convention was signed on 6 December 2019, ratified by the Argentine Senate in March 2026, but awaits the bilateral exchange of instruments before it enters into force. [2] The pattern illustrates that Argentina will denounce and renegotiate rather than tolerate perceived abuse - a posture that has shaped how practitioners structure cross-border arrangements.

How does the credit method eliminate double taxation?

Argentina applies the ordinary-credit method for residents who earn foreign-source income subject to tax in another country. Under Articles 1 and 168 of the Argentine Income Tax Law (Ley de Impuesto a las Ganancias, in its consolidated text), a resident may offset against Argentine income tax the amount of any analogous foreign tax actually paid on the same foreign-source income. The credit is capped at the Argentine tax attributable to that foreign income: if the overseas rate is higher, the excess foreign tax cannot be used and is not refundable. The credit is calculated on an all-foreign-income aggregate basis, not country-by-country, and is converted to Argentine pesos (ARS) at the exchange rate prevailing on the date the foreign tax was actually paid. [3] Where a double-tax treaty is in force and also applies the credit method - as do the treaties with Spain, Germany, France, and most OECD-modelled conventions in Argentina's network - the treaty credit provision prevails to the extent it is more favourable. If the foreign tax already paid in full equals or exceeds the Argentine tax, no Argentine residual tax arises on that income.

How does the residence tiebreaker work under Argentina's treaties?

Most Argentine treaties follow the OECD Model Convention Article 4 tiebreaker sequence for individuals who qualify as resident in both contracting states. The tiebreaker tests are applied in strict order: (1) permanent home - the state where the individual has a permanent home available; (2) centre of vital interests - the state with which personal and economic relations are closer, if a permanent home exists in both; (3) habitual abode - the state in which the individual habitually resides, if the centre of vital interests cannot be determined; (4) nationality - the state of which the individual is a national, if habitual abode exists in both or neither; (5) mutual agreement between competent authorities, as a last resort. Under Argentine domestic law, an individual who remains in Argentina for more than 183 days in a calendar year acquires Argentine tax residency. Acquisition of permanent residence in another country or demonstrating centre of vital interests abroad can result in loss of Argentine residency. The tiebreaker analysis can be complex when an individual has economic ties in Argentina (investments, pension rights denominated in ARS/USD, business interests) and a permanent home abroad. [4] A qualified tax professional should be engaged before asserting a tiebreaker position to avoid penalties for incorrect residence claims.

What reduced withholding rates do the main treaties provide?

Argentina's domestic withholding rates on payments to non-residents are: dividends 7 % (on profits of fiscal years starting on or after 1 January 2018), interest 15.05 % to 35 % depending on the nature of the lender, and royalties with effective rates of approximately 21 % to 28 % depending on the type of right. Treaties typically reduce interest and royalty rates materially; the dividend position is more nuanced because the 7 % domestic rate is already low. The table below summarises verified reduced rates for key partners based on the PwC Worldwide Tax Summaries and official treaty texts. [5]

To claim a reduced treaty rate at source, the beneficial owner must present a valid certificate of fiscal residence (see below) to the Argentine withholding agent before the payment is made. [6]

What is the MLI and how does it change Argentina's treaty network?

Argentina signed the OECD Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI) on 7 June 2017. After a lengthy legislative process, the Argentine Congress gave final approval on 7 May 2025 and Law No. 27,788 was enacted and published in the Official Gazette on 28 May 2025. Argentina deposited its instrument of ratification with the OECD on 29 September 2025. The MLI entered into force for Argentina on 1 January 2026. [7]

Argentina adopted the Principal Purpose Test (PPT) as its minimum standard for treaty abuse under MLI Article 7. The PPT denies treaty benefits where it is reasonable to conclude that one of the principal purposes of an arrangement was to obtain that benefit, unless granting the benefit would be consistent with the object of the treaty. Argentina did not adopt the simplified Limitation on Benefits clause or mandatory binding arbitration. The MLI modifies Argentina's covered tax agreements with counterparty states that have also ratified and listed their matching treaties - including Spain, Italy, Mexico, Netherlands, Switzerland, and the United Kingdom, among others. Each treaty's modified text is published as a synthesised instrument. Existing Argentine cross-border structures should be reviewed for PPT exposure, particularly holding-company or royalty-routing arrangements that rely on rate reductions in the treaty table above.

What is the MFN clause risk that has caused litigation?

Several Argentine treaties - including those with Belgium, Canada, Denmark, France, Italy, Netherlands, Norway, Sweden, and the United Kingdom - contain Most Favoured Nation (MFN) clauses in their protocols. These commit Argentina to granting counterpart residents treatment no less favourable than that accorded to any third-state resident on specified categories of income, particularly royalties and technical-assistance fees.

When Argentina's treaty with Japan (signed June 2019, pending full ratification) excludes technical-assistance payments from the definition of royalties in Article 12 - meaning such fees fall under Article 7 (business profits) and face zero source-country tax in the absence of a permanent establishment - the MFN clauses in the other treaties listed above are potentially triggered automatically. Under each such treaty, fees paid by Argentine residents for technical assistance to residents of Belgium, Canada, Denmark, France, Italy, Netherlands, Norway, Sweden, or the United Kingdom would also be treated as business profits exempt at source, regardless of what the bilateral treaty text itself says. ARCA may scrutinise technical-assistance payments, attempt to distinguish genuine know-how transfers (taxable as royalties) from service fees (arguable as business profits), and challenge arrangements that appear designed to exploit the cascade. Practitioners should document the substance of service arrangements carefully and monitor ARCA rulings and court decisions as this area develops. [8] Where uncertainty exists, a qualified tax professional should be engaged before payments are made.

How does a taxpayer obtain a certificate of fiscal residence to claim treaty relief?

Argentine residents claiming treaty benefits abroad must obtain a Certificado de Residencia Fiscal from ARCA. Under General Resolution 5572/2024 (published 24 September 2024, replacing GR 3014/2011), the procedure is fully digital and free. The applicant accesses the ARCA portal at auth.afip.gob.ar using their Clave Fiscal credential, selects the destination country and tax period, and submits the sworn declaration electronically. ARCA performs automatic cross-checks with the National Migration Directorate. Certificates in straightforward cases are issued within 72 business hours; complex cases (dual residence, state officials) are processed within 10 calendar days. The certificate is valid for one year from issuance. [9]

Conversely, foreign residents seeking treaty benefits on Argentine-source income must now present a Fiscal Residency Certificate issued by their home-country tax authority to the Argentine withholding agent. Under General Resolution 5855/2026 (effective 18 June 2026, replacing GR [DGI] 3497/1992), the certificate must be presented before the first payment under a contract and is generally required to bear an Apostille de La Haya or Argentine consular legalisation, unless the foreign authority has an official electronic verification system. Without a valid certificate in hand, the Argentine withholding agent must apply the general domestic rates rather than the reduced treaty rates. [10]

For guidance on selecting a qualified Argentine tax professional to advise on treaty positions, residence determinations, and certificate procedures, see the Argentina country overview. This page provides factual information only and does not constitute the advice of a qualified tax professional.