Payroll Outsourcing in Argentina

Employers pay social security contributions on the whole salary with no ceiling: 20.40% for private employers whose main activity is services or commerce and whose annual sales exceed the limit for a medium-sized company, and 18% for all other private employers. They fund the pension system (SIPA), the pensioners’ health institute (INSSJP, known as PAMI), family allowances and the National Employment Fund. Employers also pay 6% to the employee’s health insurance fund (obra social). A fixed ARS 7,003.68 a month per employee comes off the social security base, an amount set in 2019 and never updated.

Employees contribute 17%: 11% to the pension system, 3% to INSSJP and 3% to their obra social. Their contributions stop at a maximum monthly base that ANSES updates every month and raises by 50% in June and December for the aguinaldo. Every employee must also be covered by workplace accident insurance from an ART insurer, at a rate the insurer sets for the activity.

Every employee earns the sueldo anual complementario (SAC), known as the aguinaldo: a 13th salary paid in two instalments, each worth half of the best monthly salary of the semester, due by 30 June and 18 December. It carries the same contributions as salary.

Annual vacation is 14 calendar days for up to five years of service, 21 days up to ten years, 28 days up to twenty years and 35 days after that, taken between 1 October and 30 April unless both sides agree otherwise. Each vacation day is paid at one twenty-fifth of the monthly salary rather than one thirtieth. Since the 2026 reform, vacation can be split into periods of at least seven days by agreement, with 30 days’ written notice. Overtime is paid at 50% extra on working days and 100% on Saturdays after 1 pm, Sundays and public holidays.

Law 27.802, published on 6 March 2026, rewrote large parts of the Employment Contract Law. Severance is still one month of the best monthly salary per year of service, but the base now excludes payments that are not monthly, such as the aguinaldo, vacation pay and annual bonuses. The cap of three times the average salary of the applicable collective agreement cannot cut the base below 67% of the employee’s salary. Employers no longer owe notice during the probation period, which has been six months since 2024 and can run to eight or twelve months under collective agreements for smaller companies.

The law also created the Labour Assistance Fund (FAL). From the November 2026 payroll, employers pay 1% of salaries, or 2.5% for SMEs, into an account with a fund manager of their choice through the monthly F.931 return, and pay the same amount less in social security contributions. After six months of contributions the fund can pay severance for employees registered for at least 12 months. For workers hired under the RIFL incentive, the FAL contribution is still due but there is no matching discount.

For an employee on ARS 3,000,000 a month at a large services company, the employer pays ARS 612,000 of social security and ARS 180,000 of health insurance: ARS 3,792,000 a month. Thirteen payments a year, counting the aguinaldo, make an annual cost of ARS 49,296,000, or 36.9% on top of 12 months’ salary. At the 18% rate the same employee costs ARS 3,720,000 a month, 34.3% on top. Workplace accident insurance comes on top and depends on the insurer.

The national minimum wage (salario mínimo, vital y móvil) is ARS 391,200 a month for full-time work from 1 October 2026, rising every month to ARS 437,000 in April 2027 under Resolution 4/2026. Collective agreements (convenios colectivos) set their own minimum pay for each job category in their sector.

Employers withhold income tax (Ganancias) every month on a cumulative basis, using the nine-band scale and personal deductions that ARCA updates in January and July in line with inflation. For 2026 an employee’s annual deductions include a non-taxable allowance of ARS 6,019,671 and a special deduction for employees of ARS 28,894,423, plus amounts for a spouse and children, and the top rate of 35% applies above ARS 70,984,968 of net taxable income. Employees report their own deductions to the employer through ARCA’s SiRADIG system.

Employers register each employee in ARCA’s Simplificación Registral system before the first day of work, file the monthly F.931 return and pay contributions in the first half of the following month, and pay salaries into a bank salary account within four working days of the end of the month. Sick pay comes from the employer for up to three months per illness, or six with family dependants, doubling after five years of service. Maternity leave is 90 days, paid by social security rather than the employer.