Your guide to payroll in Argentina

Argentina has one of the largest economies in South America. The country’s skilled workforce, natural resources, good quality of life, and diverse industries make it an attractive destination for foreign investors. 

Organizations that are planning to do business in Argentina should essentially understand the local laws and regulations set by the government. 

When businesses have a clear understanding of the onboarding process, including the payroll management process, it becomes easy for them to attract, hire, and retain talent and pay employees in Argentina. 

The guide below explains everything you need to know about Argentina payroll processing and how Payoneer Workforce Management can help you streamline the payroll process.

Argentina payroll: Wages and other payments

Employers operating in Argentina must adhere to specific regulations governing salary payments, working hours, bonuses, and other entitlements when they pay employees in Argentina.

Payroll cycle in Argentina 

In Argentina, employees who are paid monthly are entitled to receive their remuneration at the end of the month. 

In cases where employees work less than a month, i.e., weekly or fortnightly wages, and for other payment terms, you can refer to the government regulations.

Minimum wage

There is a rule for the minimum wage in Argentina. Employees in Argentina are entitled to receive a minimum living wage of ARS 317,800. 

You can keep checking the official website for the updated rates. 

Minimum working hours 

Employees in Argentina should not work more than 8 hours per day, amounting to 48 hours per week (based on a six-day workweek). You can find some more exceptions here. 

Overtime pay 

The overtime hours of an employee working in Argentina must not exceed 3 hours per day, 30 hours per month, or 200 hours per year. 

When employees work overtime, they are entitled to receive 50% more than their normal salary. If overtime is performed on public holidays, on Saturdays after 1 pm, or on Sundays, the employer must pay employees in Argentina 100% more than the regular rate. 

Paid sick leave 

The law in Argentina guarantees full payment to employees for any health issue or accident that is unrelated to work. 

However, the duration of paid leave depends on the employee’s seniority. If an employee has served for less than 5 years, they receive leave of up to 3 months per year. If an employee has served for more than 5 years, they can extend the leave up to 6 months every year.

Maternity pay 

If an employee in Argentina is pregnant, they are entitled to 90 days of maternity leave, for which they will receive payment from the social security system. 

Paternity pay 

Employees in Argentina receive full payment if they take 2 days’ consecutive leave immediately after the birth of a child. 

Severance pay 

Employees in Argentina are entitled to receive severance pay if their dismissal is unjustified. They shall receive a month’s salary for every year, or any fraction that exceeds 3 months. 

Payroll in Argentina: Contributions and deductions

In Argentina, employers are required to make certain payroll contributions and deductions from employees’ salaries in accordance with national regulations when they pay employees in Argentina.

Social security contributions in Argentina

Employees in Argentina contribute a part of their gross salary as social security contributions. Check the official website for more information. 

Income tax 

After all the deductions for social security and other allowable parameters are made, income tax is applied to an employee’s income. The rates for income tax in Argentina range between 5% and 35%. 

Other employee benefits

In Argentina, employees are entitled to a range of statutory benefits designed to protect their work-life balance and overall well-being.

Public health insurance

In Argentina, public health insurance is a compulsory employment benefit, funded through mandatory employer contributions as part of the country’s social security system.

Earned/Annual leaves: 

In Argentina, all employees are entitled to paid annual leave. The number of leave days is determined by the years they have served with the company.

The number of leave days based on employees’ seniority is as follows:

Annual bonus: 

Employees in Argentina receive a 13th payment, known as Sueldo Anual Complementario (SAC) or Aguinaldo, that is divided into two installments. The first installment is paid in June, and the second installment is paid in December. 

Holiday/Vacation bonus: 

Employees in Argentina receive an additional amount along with their salary during the vacation period. This amount is calculated based on the employee’s average daily earnings over the past year, multiplied by the number of vacation days granted. 

Argentina payroll compliance best practices

To stay compliant with labor and tax regulations, employers in Argentina must follow specific payroll practices and documentation requirements when they pay employees in Argentina.

1. All employees in Argentina are registered in the legal labor book for social security and taxation.
2. Argentina incorporates the use of a digital payroll book. It is a tool that simplifies the procedures that otherwise need to be done by the employers. This not only helps reduce manual labor, but also increases accuracy. 
3. Employers pay employees in Argentina in their own salary accounts. This enables secure, transparent, and timely salary transfers. 
4. Employers also take care of employees’ pay slips requirements in Argentina. They provide legally compliant payslips to employees that contain the detailed breakdown of the amount paid to the employee- the gross pay, deductions, and the net pay. 

Your options for payroll services in Argentina

Employers can use the following ways to pay talent and reduce the employment costs in Argentina:

1. By setting up a local entity: When you set up a local entity, it acts as a legal business presence, taking care of the payroll compliance in Argentina. This may, however, be a time-consuming procedure.
2. By hiring contractors: Hiring self-employed contractors allows you to pay talent via international payment platforms. However, this may not support payroll compliance as per local regulations.
3. By using an EOR: EORs facilitate employers in streamlining the payment process by navigating the local requirements. With this kind of compliance support, employers can pay employees in Argentina accurately and on time.

Payoneer Workforce Management helps streamline the employment process by supporting onboarding, payroll, benefits, leave policies, taxes, etc. 

Get experts’ guidance to simplify the operations and reduce the burden of administrative tasks, as well as payroll management in Argentina. 

Book a demo today. 

FAQs

1. Are bonuses and allowances subject to payroll taxes?

Most of the bonuses and allowances that employers pay employees in Argentina are part of the taxable income. They are also subject to income tax and social security contributions.

2. Can payroll be outsourced in Argentina?

Yes, employers can outsource payroll management in Argentina. Companies may also leverage an EOR for tasks like salary payments and reporting with support for payroll compliance in Argentina. 

3. Is payroll recordkeeping mandatory?

Yes, payroll recordkeeping is essential. When employers pay employees in Argentina, they must maintain the payroll through a digital payroll book system. It keeps a track of the deductions made under different heads, the employee’s gross and net payment. 

4. What is the minimum wage in Argentina?

The minimum wage in Argentina is ARS 317, 800. 

5. What is the payroll tax in Argentina?

 In Argentina, payroll taxes are calculated on an employee’s gross salary. For a detailed breakdown, you can use our employee cost calculator tool.