The BPC is the reference unit that is behind the calculation of the bands of the Personal Income Tax (IRPF) and that is also used for the payment of different social benefits or study scholarships.
With the new setting lThe minimum range of IRPF contributions goes from $36,148 to $39,620. This means that monthly assets below this amount will not be affected by the tax.
Nevertheless, This amount does not take into account the deductions that are calculated for the payment of this tax (Fonasa, retirement contributions, Labor Reconversion Fund, among others), so the limit to be taxed will be higher according to the deductions that each worker can make.
Meanwhile, monthly income greater than $650,901 (more than 115 BPC), will be taxed at 36%, the highest tax rate, for the part that exceeds that amount.
For the third consecutive year, the Ministry of Economy and Finance (MEF) chose the evolution of the Average Wage Index (IMS) as the BPC adjustment criterion.
With the adjustment of the BPC, the Social Security Assistance Tax (IASS) is also modified. The non-taxable minimum with retroactivity on January 1 goes from $41,312 to $45,280, which is equivalent to 8 BPC in the month. Income from liabilities that are less than that amount are not covered by the IASS.
Meanwhile, monthly liabilities that exceed $283,001 (more than 50 BPC) are taxed at 30%, which is the highest tax rate.
How are other benefits with the adjustment?
Meanwhile, the minimum retirement of 3.05 BPC —which some 140,000 retirees earn— will go from $15,750 to $17,263 from January of this year (+$1,513).
will also fit the tax paid by graduates of the University of the Republic (Udelar), UTU and UTEC to the Solidarity Fund from the fifth year of graduation, and in cases where their monthly income exceeds 8 BPC ($45,280). Contributions vary between ½ and 2 BPC per year depending on the number of years of the degree and the number of years from the date of graduation.
At the same time, the monthly scholarships that students receive from the Solidarity Fund they will go to $11,320 (equivalent to 2 BPC). This benefit is paid in a maximum of 10 payments for renewals and 8 for those who receive it for the first time.
Secondly, the maximum deduction of 36 BPC is also raised ($203,760) of the mortgage installments of properties that are below 794,000 Indexed Units (about US$111,000 at today’s values).
