Sole proprietorship vs SAS in Uruguay: what to compare before choosing

The useful comparison is not “sole proprietorship is cheap, SAS is expensive” or “SAS pays less tax”. The structures are different, and the result depends on activity, shareholders, income tax, BPS, administration and growth plans.

A sole proprietorship often fits when

• You start alone.
• You mainly sell your own work.
• You do not need equity for partners or investors.
• Your activity naturally fits an individual registration.

A SAS deserves analysis when

• You need a separate legal entity.
• There will be partners or equity ownership matters.
• A company-level IRAE treatment genuinely applies to the activity.
• The business is growing beyond selling only the founder's hours.

Software makes the analysis more important

Qualifying software activities can have a specific IRAE exemption regime, but creating a SAS does not automatically activate it. Activity, substance, documentation and other requirements still have to be met.

Include BPS in the comparison

Shareholder, administrator, activity and healthcare status can affect social-security obligations. Compare the full tax and social-security cost, not IRAE or IRPF in isolation.