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Global Payroll Team
Written by Global Payroll Team
Last updated May 7, 2026
Expert Reviewed
Payroll in Peru
Tax in Peru
Immigration in Peru

Peru map

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Mercans offers complete payroll, PEO and HR services in Peru

Peru remains an important economy in Latin America with strong activity in mining, energy, agriculture, manufacturing, services and tourism. The country maintains a broad network of trade agreements and an open investment regime, making it an attractive destination for foreign investment despite periodic political uncertainty.

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Doing Business in Peru

Peru continues to attract foreign direct investment through its natural resource base, trade connectivity and investment framework. Employers doing business in Peru should still assess labour, tax and immigration rules carefully, as compliance obligations remain detailed and sector-specific.

Entity Registration and Incorporation Requirements

Setting up a new business or expanding an existing one in Peru is straightforward. Choose how your company operates from a range of entity types that suit your individual circumstance.

Banking

Banking hours vary by institution, although banks generally operate during standard weekday and partial Saturday business hours and digital banking is widely used.

Working Week

The standard working week is up to 48 hours, usually spread over Monday to Saturday depending on the employer’s schedule.

Labor Law

Labor law regulates the relationship between employers and employees and collective bargaining, arbitration and right to strike. There are specific laws regulating statutory benefits, minimum standards for wages, working conditions and occupational safety and health.

Main Industries

Mining, metals, hydrocarbons, manufacturing, agriculture, fisheries, construction and services

GDP Growth

3.4%

Dates & Numbers

dd/mm/yyyy

Official State Name

Republic of Peru

Population

34.35 million

Capital

Lima

Major Languages

Spanish, Quechua, Aymara

Currency

Peruvian Sol (PEN)

Internet Domain

.pe

International Dialing Code

+51

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Peru
Lima, PE
8:47 am, May 13, 2026
22°C
overcast clouds
83 %
Wind Gust: 0 mph
Clouds: 100%
Sunrise: 6:17 am
Sunset: 5:51 pm

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Payroll

Employees in Peru are entitled to a number of statutory benefits in respect of their wages, including annual bonuses, compensation for length of service, annual leave and social security contributions. The minimum wage is adjusted by the government periodically and currently stands at S/ 1,130 per month for private-sector employees working a full legal schedule.

It is acceptable to provide employees with online payslips

Payslip

Payroll reports must be kept in line with applicable tax and labour recordkeeping rules

Reports

Employees receive paid annual leave of 30 days

Annual Leave

The employer generally pays the first 20 days of sick leave, after which EsSalud coverage may apply

Sick Leave

Employees are entitled to 98 days of paid maternity leave and 10 working days of paid paternity leave as applicable

Maternity & Paternity Leave

In dismissal procedures, employees are typically given 6 calendar days to respond for conduct-related grounds and 30 calendar days for capacity-related grounds

Employee Termination

The 13th month and 14th month payments are mandatory

13thmonth salary

1,130 PEN per month

Minimum Wage

Overtime pay is calculated at 25% of the employee’s ordinary rate of pay for the first 2 hours of overtime

Overtime

Compensation for arbitrary dismissal is generally 1.5 monthly salaries per year of service, up to a maximum of 12 monthly salaries

Severance Pay

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Tax and Social Security

Peru guarantees private initiative and investment across the economy, while tax and payroll compliance is administered through SUNAT and other public entities. Social health insurance contributions must be paid monthly to EsSalud, and pension contributions apply through either the public or private pension system.

Tax

Income tax is withheld from wages and paid by the employer on the employee’s behalf. Non-domiciled employees on payroll are generally subject to a 30% withholding on Peruvian-source employment income.

29.5%

Corporate Income Tax

30%

Personal Income Tax

18%

Sales Tax

18%

VAT

Social Security

Contributions must be made for social health insurance and pensions. EsSalud is funded by the employer, while pension contributions are generally withheld from the employee through the National Pension System or a private pension fund administrator.

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Social Security Rate

9%

Social Security Rate for Employers

13%

Social Security Rate for Employees

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Employment Law

Employees are generally entitled to the same core labor benefits whether they are hired for an indefinite term or a fixed term. Labor legislation is protective regarding dismissal of employees and regulates statutory benefits, work schedules, occupational safety, and termination procedures.

Employment Agreement

A fixed term contract must be written and signed by the employee. Legal bonuses are paid twice a year, each bonus equivalent to one month’s pay, subject to the applicable legal rules.

Working condition

In addition to their salary, employees are entitled to certain statutory benefits such as compensation for length of service, profit-sharing where applicable, family allowance, life insurance and more.

Leaves

Annual leave taken must be agreed between the employer and employee and can be split in accordance with the law. Atypical work periods are permitted provided the average working time does not exceed the legal maximum. There are also other types of leave permitted such as maternity and paternity leave.

Employment termination

Any termination of an employee can only be done for just cause in cases linked to the employee’s capacity or conduct. When dismissed without just cause, the employee may be entitled to compensation for unfair dismissal.

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6 to 30 days

Typical legal response period in dismissal procedures, depending on the grounds invoked

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16 days

Total number of public holidays

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48

Working hours per week

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Not statutory

Total number of days for Compassionate & Bereavement Leave

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Immigration

The hire of foreign workers is governed by immigration and employment rules that require contract registration and the appropriate migration status. Foreign workers generally need a work-authorized residence status to perform services legally in Peru.

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Residency permits

In general, foreign workers are hired under fixed-term arrangements, and the relevant employment contract must be registered where required. A resident worker immigration status generally authorizes residence for 365 days and can be extended for the same period.

Work Permit Validity

365 days, renewable for the same period

Required Documents

A passport that is valid for at least six months after the employee is due to arrive in Peru

Copies of the front and back pages of the passport

Completed immigration application documents

A signed cover letter explaining the purpose of the trip to Peru

Supporting employment and contract documentation

Evidence of financial support where requested

A no-objection or sponsorship letter from the employer if a job has already been lined up in Peru

Compliant, reliable, error-free and touchless payroll in Peru

Build the best team and hire top talent compliantly in Peru. Get in touch with Peru payroll outsourcing & PEO specialists for a free consultation!

This document was prepared for informational purposes only. As local laws & regulations keeps on changing. Please consult your tax & legal advisors as well.
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    FAQs

    What is an Employer of Record (EOR) in Peru and how does it work for foreign companies?

    An Employer of Record in Peru, provided by Mercans, serves as the official employer for your team in the country. Mercans manages all employment contracts, payroll processing, tax filings, and compliance with local labor laws, allowing international companies to hire professionals in Peru without setting up a local entity.

    Why should businesses use an EOR instead of establishing a legal entity in Peru?

    Choosing Mercans as your EOR in Peru saves time and operational costs by eliminating the need for a local company setup. It ensures immediate compliance with Peruvian employment and tax regulations and allows businesses to focus on core operations while Mercans handles HR, payroll, and legal responsibilities.

    How does payroll outsourcing in Peru ensure compliance with tax and labor laws?

    Mercans’ payroll outsourcing in Peru guarantees full compliance with all statutory obligations, including salary processing, tax deductions, social security payments, and labor contributions. The payroll system is updated according to local regulations to prevent penalties and ensure accuracy and transparency.

    Can an Employer of Record in Peru hire employees and manage work permits for international companies?

    Yes. Mercans can hire employees on behalf of foreign companies and manage all visa and work permit procedures for expatriates working in Peru. This enables companies to employ local and international talent with full legal compliance.

    What are the main benefits of using EOR and payroll services in Peru for global expansion?

    The key benefits of Mercans’ EOR and payroll services in Peru include fast market entry, access to local expertise, reduced administrative burden, and full compliance with employment and tax laws. Businesses can scale operations efficiently while Mercans ensures seamless workforce management and compliance.

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