Business solutions for digital nomads: How to register a company in Peru

digital nomad business solutions, immigration peru

So you’ve decided to run a business while you’re traveling the world and now you have to decide where to register your company. You’re probably looking for a simple and tax-friendly solution.

I talked to my friend and business partner Sergio Vargas and asked him how a digital nomad can set up a company in Peru, what this implies and which advantages and possible disadvantages it has. Sergio is the owner of NVC Abogados, a small law firm located in Lima and operating all over Peru. They specialize in immigration, taxes and company solutions and assisted me in obtaining my residence permit for Peru.

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Why choose Peru as a registered business address?

Peru is nowadays one of South America’s most stable economies and has been enjoying monetary stability for years. Long gone are the days when Peru suffered from hyperinflation in the early 1990’s which eventually led to the introduction of the “Nuevo Sol” which is now simply “Sol” again.

Dollar account possible

Although the sol is Peru’s official currency, everyone can also open a dollar account at their bank and withdraw dollars from almost every ATM across the country. So even if the country were hit by another inflation, it wouldn’t affect your company’s assets.

Online services

No matter whether it’s online banking, issuing invoices, paying fees, making appointments at government institutions or filing your taxes, you can do it online, either from Peru or from abroad. This is something which really surprised me because Peru is not what I’d call a digital society. There are very few Peruvian digital nomads and the number of people working online or remotely is increasing only very slowly. However, the Peruvian government implemented all these services and the online banking of the two Peruvian banks I’m using is much better than what my German bank offers.

The downside: If something goes wrong and you have to call the customer service or need to go somewhere in person, you’re f**ed, to be honest. I hate to say it but in my experience, the majority of Peruvians have no service mentality and are not willing to help you. You need to become loud and be an impertinent gringo if you want to achieve something and sometimes, you’ll nevertheless hit a brick wall.

No-discrimination policy

Peru has very strict anti-discrimination laws. This is important if you hold a passport from a country which may make things difficult for you if you want to start your business somewhere. I don’t mean to say that everything works perfectly in Peru. However, the laws exist and if you think that you’re discriminated because of your nationality, you can take legal action.

In general, Peru is pretty welcoming as far as immigration and the establishment of foreign businesses are concerned.

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Interview with Sergio Vargas, NVC Abogados

I met Sergio in early 2017 when I had already decided to go back to Latin America but wasn’t sure yet what to do about my residence and business. I was playing with the idea to use Estonia’s e-residency to set up my business, applied for my e-residency card and even spent a week in Tallinn. Therefore, Sergio first suggested going for a rentista visa to obtain a residency permit for Peru. For various reasons, I finally decided against it, spent some time in Argentina and Brazil to think about everything again and eventually chose the option to register my business in Peru and apply for a work visa as CEO of my own company.

Before we met, Sergio knew almost nothing about the digital nomad lifestyle and was pretty astonished (and a little shocked, I think) that I didn’t have a home somewhere and that everything I own fits in my backpack. Well, we’ve learned a lot from each other and despite our clashing personalities (introvert vs extrovert), we normally get along pretty well and as I’m a bit involved in Sergio’s office activities when I’m in Lima, I see how engaged he is with his clients and his work.

Ok, so let’s talk about setting up a business as a digital nomad in Peru now.

business solutions for digital nomads, immigration peru

Sergio in front of the Migraciones Office in Cusco

Sergio, is it possible to register a company without being a resident in Peru?

Yes, it’s possible. It’s not very common because most of my clients register a company for visa reasons but legally, Peru doesn’t have any laws which forbid foreigners to start a business here without becoming residents. We’re talking about capital companies here, not private companies.

Which legal form do you suggest and why?

At NVC Abogados, we help our clients to open an SAC. This is a capital company, similar to an LLC in the USA. The advantage is that you’re not liable with your personal assets, just with what you brought you into the company. Apart from that, issuing invoices with and administrating an SAC is easy. After the first initial steps, you’ll be able to do everything online, no matter where you are.

An SAC requires two partners. How about this?

If you’re alone and have no intention to run the company with a business partner in the future, we provide assistance with this by registering someone from our office as your partner. That person will hold 1% of the company and you will hold 99%, so you’ll be in full charge and control of everything.

Which documents are needed to register a company in Peru?

All you need is a valid passport and a valid tourist visa and we will make sure that you get the so-called “special authorization to sign contracts” because otherwise, your signature on the documents we have to sign at the notary wouldn’t be valid.

There’s no need to bring certificates from your university or other institutions where you obtained your qualifications. That means, no additional costs for translations. It’s really a very easy process if you know how to do it. Sometimes, people come to our office after trying it without legal help and come across one obstacle after the other.

You need to follow certain steps and be aware of the correct order. Making the process easy and hassle-free for my clients is my job.

Is it necessary to come to Peru to register the company?

If you have the chance to come to Peru to register the company, everything will be easier and faster. Apart from that, Peru is a beautiful country and makes it easy for people of most nationalities to come here and visit as a tourist. So as a lawyer and as someone who loves Peru, its culture and natural beauty and diversity, I encourage you to spend some time in Peru and while you’re here, we meet once or twice and start your company.

However, if for some reasons, someone wants to register their Peruvian company right now but can’t make it to Peru, we can do it for you even without your presence.

There are two possibilities:

  1. You authorize us to register a company in your name. You’ll need to go to the Peruvian embassy in your country and obtain a so-called “poder consular”.
  2. Your company is created with two members of the NVC Abogados staff as founder partners and then sold to you. Don’t worry, we won’t charge you extra for this, it’s just part of the process. This is possible within a couple of days and in the end, the foreigner owns 99% of the company and one of the Peruvian founder partners sticks with 1%. If the company is to be owned by two people, we will certainly transfer the ownership to both of them.

We recommend the second possibility. No third-party institution (embassy) is involved and therefore, it’s faster and easier.

How much cash contribution is required?

There’s no cash contribution necessary. It’s sufficient to list assets such as a laptop, a camera or other electronic equipment. Peruvian law doesn’t require a minimum contribution. Basically, it’s just a formality.

The social capital of a company in Peru, can be constituted, through contributions of money (money supply) or also with contributions of goods or things property (non-monetary contributions) that can be FF&E (Furniture, Fixtures & Equipment) to which will be given a market value.

In Peru, there’s no minimum contribution required to start a company.

It’s not necessary, either for the company to have a Peruvian founding or permanent partner, it can be started with two foreigners without any problems, no matter whether they are residents in Peru or not.

How long does it take to set up a company in Peru?

If planned accordingly, this a pretty fast and straightforward process. From your first contact with NVC Abogados to having the confirmation that your company has been registered and is ready for business transactions, it normally doesn’t take longer than two weeks.

What about taxes and accounting?

Most likely, your company will be a so-called MYPE (micro y pequeña empresa). In Peru, these kinds of companies are usually run by individuals or are small family businesses which were founded to support their owners. There may be employees but usually not many.

As a general rule, no more than 20% of the employees should be foreigners and the salaries paid to foreign employees shouldn’t exceed 30% in monetary value. However, the labor contract law and its regulation establishes that management and top-ranking salaried employees such as the General Manager can be hired through a process called “Procedure of Exoneration of Limiting Percentages”, explaining technically the importance and necessity of hiring the owner partner of 99% of the shares and who occupies the position of the CEO. This is what we do when a foreigner starts their own company in Peru and which has been approved without exceptions.

As MYPES typically don’t generate huge revenues, the tax load for your company is minimal. If your revenues don’t exceed S/. 1,260,000/year (app. USD 386,000), you’ll pay 1% taxes. For revenues between S/.1,260,000 and S/. 7,140,000/year (app. USD 386,000 – USD 2,157,000), the tax rate amounts to 1.5%.

I’m sure you’re curious about the running costs of your Peruvian company. Let’s take Daniela as an example. She currently pays USD 260/month. This includes her taxes, the cost for the accountant, her premiums for the Peruvian health insurance ESSALUD and the national annuity insurance plus a fee for our services which consist in organizing everything for her and making sure that everything is correct. All she has to do each month is sending us copies of her invoices as a vendor and as a customer to prove that she had expenses and revenues.

Sometimes, we have inspections and if you are our client, we’ll take care of that at no additional costs.

How about opening a bank account and what can you do with it?

As soon as your company is registered, you can go to any bank and open a business account. It’s not necessary to be a resident, you just have to bring your passport and certain documents which prove that your company is legit. If you started your company with our assistance, we’ll provide you with all these documents and can also accompany you to the bank if necessary.

Just like a private account, you can have a business account in dollars and/or soles. Normally, banks will ask you for a deposit when you open your account. However, you can withdraw the deposited money after a couple of business days.

Unlike private accounts, business accounts are not free. You’ll have to pay a monthly fee which varies from bank to bank but shouldn’t exceed 30 USD.

Peru’s banks offer full-functioning online banking which can easily be handled from abroad, too. However, at this moment, it’s still necessary to come to Peru to open your account.

 

Thank you very much, Sergio. 

 

One last word about banks from my side: Although it’s theoretically possible to open a bank account at any bank, I recommend choosing Interbank as it’s the only bank which can be connected with PayPal. I’m not a huge PayPal fan but when you work globally online, you should be able to offer payments by PayPal to your customers. Some time ago, I wrote an article about how to receive international payments in Peru which you may want to read, too.

 

Anxious to start your company in Peru?

Please contact Sergio directly through the form below if you’d like to start your company in Peru and/or become a resident by obtaining a work or rentista visa.

 

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digital nomad business solutions, start company peru, visas for peru, peru immigration
digital nomad business solutions, start company peru, visas for peru, peru immigration

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