Back

Payroll and Benefits Guide Peru

Last updated: May 16, 2023

Currency
Peruvian Sol (PEN)
Employer Taxes
18.72%-28.72%
Payroll Frequency
Monthly
Employee Costs
13%
Capital
Lima
Date Format
dd/mm/yyyy
Fiscal Year
1 January - 31 December
video poster

Contribution

Employer Employer Payroll Contributions
  10% of minimum wage Family Allowance (only for workers with children)
9.00%
Health Insurance (National Health System (EsSalud)/ Private Health System (Entidades Promotoras de Salud or EPS)
9.72% The Peru Working Compensation or Compensation for Length of Service (CTS).
18.72%  -28.72% Total Employment Cost
*The CTS is mandatory only for the private sector and has specific minimum eligibility for workers who have worked at least one month (30 calendar days) in the service of the same employer, work a minimum daily average of 4 hours, and applies to an appropriate company size (20+ workers).
Employee
Employee Payroll Contributions
12.50% to 13.00%
Pension Fund (13% for employees affiliated with the National Pension System or circa12.5% for employees affiliated with the Private Pension System)
12.50% to 13.00%
Total Employee Cost
Employee Income Tax
1 Tax Unit (UIT) = 4,600 PEN
8.00%
Up to 5 UIT
14.00%
From 5 UIT to 20 UIT
17.00%
From 20 UIT to 35 UIT
20.00%
From 35 UIT to 45 UIT
30.00%
More than 45 UIT

Employer taxes

Highest
Lowest

Employee taxes

Highest
Lowest

Minimum Wage

General

The national minimum wage in Peru is 1,025 PEN per month.

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

Employees are paid monthly.

13th Salary

13th-month and 14th-month payments are mandatory in Peru. The employer must pay an additional month’s salary twice a year, once at the end of July around Peru’s Independence Day and the other at the end of the year during Christmas.

Authority Payments

Authority Payment

Paid To

Due Date

Method

ONP – Pension fund (Public)

SUNAT

It is variable depending on the last digit of the TAX ID of the Company. I send the 2020 schedule so you can see it.

– CHARGE TO THE COMPANY’S BANK ACCOUNT

– CASH

– ECHECK

RENTA 5TA CATEGORÍA (Income Tax)

SUNAT

It is variable depending on the last digit of the TAX ID of the Company. I send the 2020 schedule so you can see it.

– CHARGE TO THE COMPANY’S BANK ACCOUNT

– CASH

– ECHECK

ESSALUD (National Insurance)

SUNAT

It is variable depending on the last digit of the TAX ID of the Company. I send the 2020 schedule so you can see it.

– CHARGE TO THE COMPANY’S BANK ACCOUNT

– CASH

– ECHECK

AFP – Pension fund (Private)

The maximum term of presentation and payment is until the fifth (05) business day of each month.

– CHARGE TO THE COMPANY’S BANK ACCOUNT

– CASH

– ECHECK

Working Hours

General

Full-time employment is 8 hours per day, 48 hours per week.

Overtime

All overtime hours in excess of 48 hours a week are paid at an overtime compensation rate. This rate is stipulated in the employment contract/collective agreements. The first two hours of overtime cannot be compensated with less than 25.00% of the total remuneration of the employee. For every additional hour of overtime, the surcharge cannot be less than 35.00% per hour. Exemptions might apply to managers, supervisors, on-call workers, and non-supervised workers.

Leave

Annual leave (vacation)

Employees are entitled to paid annual leave of 30 calendar days. At least 15 days must be used within the year and the remaining can cash out. 15 of the 30 days entitlement may be divided into two periods and the remainder is to be taken in at least one-day increments. Domestic workers are entitled to 15 days of paid annual leave.
An employee cannot take annual leave alongside any other leave entitlement such as maternity leave, and sick leave.

Public Holidays

The Government decides each year if public holidays falling on weekends are moved to a weekday in lieu.

Date Day Holiday Notes
1 Jan 2024 Monday New Year’s Day
28 Mar 2024 Thursday Holy Thursday
29 Mar 2024 Friday Holy Friday
1 May 2024 Wednesday Labor Day
7 Jun 2024 Friday Arica’s Battle and The flag Day
29 Jun 2024 Saturday Saint Peter and Saint Paul
23 Jul 2024 Tuesday Aeroforce day
28 Jul 2024 Sunday Independence Day
29 Jul 2024 Monday Independence Day Holiday Day Off in Lieu
30 Aug 2024 Friday Saint Rose of Lima
8 Oct 2024 Tuesday Battle of Angamos
1 Nov 2024 Friday All Saints’ Day
8 Dec 2024 Sunday Immaculate Conception
9 Dec 2024 Monday Ayacucho’s battle Holiday only for the public sector
25 Dec 2024 Wednesday Christmas Day

Sick Days

In Peru, employees are entitled to 365 days of paid sick leave. The employer compensates the first 20 days of sickness at 100% salary and the remaining 245 days are paid initially by the employer at 70-80% and then the social security reimburses this sum.

Maternity Leave

Female employees are entitled to 98 days of paid maternity leave; 49 days before the birth of the child and 49 days following the delivery. In the event of multiple or complicated births, the leave can be extended by 30 days.
The National Health System (EsSalud) or the Private Health System (Entidades Promotoras de Salud or EPS) compensates maternity leave. To qualify for maternity benefits, the employee must have completed three months of service during the six months before leave.
Mothers also receive 30 days of paid adoption leave following the adoption of a child until the age of 12 years old.

Paternity Leave

The father/partner is entitled to 10 days of paid paternity leave after the child’s birth; the entitlement increases to 20 days of leave in the case of a complicated or premature birth.

Parental Leave

There are no provisions in the law regarding parental leave.

Other Leave

There are no provisions in the law regarding additional statutory leave.

Vacation Days
Public Holidays
Highest
Lowest

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

The termination process varies according to how the employment agreement and collective agreement are in place and is based on the type of contract and reason for termination. Employees should receive at least six days’ written notice so that they can respond or prove their capability within the company. The employer must provide the written termination to both the employee and the trade union. Employees dismissed without cause are typically entitled to severance pay of up to 12 months.

Notice Period

Employers must give 6 to 30 days’ notice depending on the reason for dismissal. If an employee is resigning, they must provide an employer with at least 30 days’ notice.

Severance Pay

There is no statutory severance entitlement, but an indemnity is payable in the event of unfair dismissal (ie, where the company does not have a prescribed legal ground to dismiss employees).

In the event of unfair dismissal, employees are entitled to receive a legal indemnity in the amount of: 1.5 times their monthly remuneration for each year of service if the employee is on an indefinite employment contract. Periods of time less than 1 year must be paid proportionally 1.5 times their monthly remuneration for each month remaining until the end of the fixed-term contract, if applicable. In both cases, such indemnity may not exceed 12 monthly salaries.

Probation Period

In Peru, probation periods are outlined in the employment contract. Typically, the probational period lasts for three months.
The probationary period may be extended for skilled workers or employees in positions of trust to six months and one year for managerial roles.

VISA

VISA

A foreigner wishing to work in Peru must complete the new TUPA (Texto Unico de Procedimientos Administrativos; Single Text of Administrative Procedures) process.
Applying for a Peruvian resident work visa requires the following:

  • Interpol clearance – Ficha de canje internacional
  • Receipt for the paid application fee
  • Receipt for the paid application fee for changing to a resident visa
  • Passport
  • Legally signed and by Labour Ministry approved work contract with a duration of at least 12 months
  • Police clearance certificate, criminal record, and judicial matters check issued in the country of origin and if the applicant lived in another country before coming to Peru, in the land of residence covering the last five years *
  • SUNAT registration including RUC (Peruvian tax number) showing the employing company is active
  • Company registration of the employing company showing the legal representative
  • Sworn statement of the legal representative of the company declaring that he oversees hiring personnel and why he needs to employ a foreigner

*For the past years, a sworn statement stating that the foreigner has a clean criminal record and no previous convictions was enough to satisfy Migraciones. However, the new Tupa and Supreme Decree now state that a police clearance certificate, criminal record, and judicial matters check issued in the country of origin and if the applicant lived in another country before coming to Peru, in the country of residence covering the last five years is required. “Antecedentes Policiales, Penales y Judiciales.”
Once this is complete, the foreigner will receive confirmation that your work visa is approved, payment has been made and the person is now registered in the foreigner database and issued the carné.

Remote Work

The Government of Peru passed legislation on remote work aiming at recognizing teleworking as a valid way of carrying out work. This legislation states that teleworkers and onsite employees must have the same rights
and that the employer and employee should agree on the provisions of teleworking in an employment agreement. Such agreement must be stored in a digital medium and must include information on the teleworking period, frequency (total or partial), the work schedule, applicable digital platforms and technologies, communication and supervision, mechanisms, notice period for the employee to attend in person to employer’s premises and the teleworker domicile.
Unless agreed otherwise between the parties, employers should provide necessary work tools and bear the cost of electricity.
Employers have a duty to ensure the safety and health of their employees at work. Therefore, employers should inform teleworkers of all the risks that may arise from their work duties.
Teleworkers should allow their employer to visit their remote workplace. Teleworker may instead complete a self-examination of their workplace as authorized by the Peruvian Ministry of Labor.
Unless otherwise agreed between the parties, the teleworker must comply with a work schedule.
Employers must respect teleworkers’ right to digitally disconnect after work and their right to privacy of communications. However, teleworkers must be available to their employer during the working day and fully comply with their work obligations.
Prior notice in writing and agreement of the employer and the teleworker is needed if any of them wants to reverse the teleworking arrangement.

VAT

General

The standard rate of VAT in Peru is 18.00%.

Stay up to date on payroll & employment law changes

Version History

May 31, 2022
The national minimum wage in Peru is now 1,025 PEN per month.
Payroll contributions and personal income tax rates have been updated.
December 12, 2021
The Peru Working Compensation (CTS) Employer contribution updated to 9.72%.
More

Questions & Answers

Subscribe
Notify of
guest
6 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Jaimee L
Jaimee L
2 years ago

Is their a limit on overtime work?

Erez Greenberg
Erez Greenberg
2 years ago
Reply to  Jaimee L

Hi Jaimee, employees should only work a maximum of 48 hours per week, and all work exceeding this should be mutually agreed on between the employer and employee.

Martijn
Martijn
3 months ago

Hi, I’m from the Netherlands and I’m going to do my internship in Peru for 4 months. Herefore I’m getting an ‘internship compensation’. Do I also need a working VISA then? And do I need to pay Peruvian or Dutch taxes?

Enny Shmurin
Admin
Enny Shmurin
3 months ago
Reply to  Martijn

We recommend reaching out to the institute who is sponsoring this internship in order to understand the set up and conditions.

Terry Campbell
Terry Campbell
3 months ago

In Peru do employees have to complete a Vacation request form? Does it has to be in writing or can it be electronically submitted?

Enny Shmurin
Admin
Enny Shmurin
3 months ago
Reply to  Terry Campbell

Employees should submit vacation requests in writing. However, employers have the flexibility to establish any system or process for monitoring such requests. It’s advisable for employees to follow the guidelines provided by their employer.

Download this guide to read later

Payroll and Benefits Guide in Peru

Download Free Guide

See how Papaya can help you automate your global payroll or EoR whilst staying 100% compliant with local labor laws

The information provided in the Papaya Global Web site is provided for informational purposes only. The materials are general in nature; they are not offered as advice on a particular matter and should not be relied on as such. Use of this Web site does not constitute a legal contract or consulting relationship between Papaya Global and any person or entity. Although every reasonable effort is made to present current and accurate information, Papaya Global makes no guarantees of any kind. Papaya Global reserves the right to change the content of this site at any time without prior notice. Papaya Global is not responsible for any third party material that can be accessed through this Web site. The materials contained on this Web site are the copyrighted property of Papaya Global unless a separate copyright notice is placed on the material. Papaya Global grants each user a non-exclusive, non-transferable license to access and download, display and print one copy of the content of this Web site on a single computer solely for internal, business use, provided that the user does not modify the site content in any way and that all copyright and other notices displayed on the site content are retained. Other reproduction, distribution, republication and re-transmission of materials contained within this Web site require Papaya Global’s prior permission.
Download this guide to read later

Payroll and Benefits Guide
in Peru

What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

And more...

Download free guide
All questions are answered by our in-house compliance department working in conjunction with our local in-country partner for this specific country

Public Holidays Calendar

Peru
Download:
CSV
PDF
ICS
Date Day Holiday Notes
1 Jan 2024 Monday New Year’s Day
28 Mar 2024 Thursday Holy Thursday
29 Mar 2024 Friday Holy Friday
1 May 2024 Wednesday Labor Day
7 Jun 2024 Friday Arica’s Battle and The flag Day
29 Jun 2024 Saturday Saint Peter and Saint Paul
23 Jul 2024 Tuesday Aeroforce day
28 Jul 2024 Sunday Independence Day
29 Jul 2024 Monday Independence Day Holiday Day Off in Lieu
30 Aug 2024 Friday Saint Rose of Lima
8 Oct 2024 Tuesday Battle of Angamos
1 Nov 2024 Friday All Saints’ Day
8 Dec 2024 Sunday Immaculate Conception
9 Dec 2024 Monday Ayacucho’s battle Holiday only for the public sector
25 Dec 2024 Wednesday Christmas Day