Entity Setup
Entity Setup in Latin America: Establishing a Exporting Business Efficiently
Setting up an entity to export goods or services from Latin America? Here's how to optimize your structure for tax, VAT, and regulatory efficiency.
By NomadicTax Research Team • 5-8 min read • August 10, 2026
## Choosing the Right Legal Form
In Latin America, company types vary: *Sociedad Anónima (S.A.)*, *Sociedad de Responsabilidad Limitada (S.R.L.)*, *Limited Liability Company (LLC-style)*, etc. Choose a form that:
- Limits personal liability
- Offers favorable tax treatment
- Is recognized for exports and international contracts
## VAT / Sales Tax for Exports
Exports generally enjoy **zero-rate VAT** or exemptions. To benefit:
- Ensure correct documentation of export contracts and shipments.
- Maintain proof of the international sale (e.g., export declarations).
- Keep invoices in order and registers clean.
## Import & Export Regulatory Permits
- Know the customs classifications and duty rates: letters, tariffs can vary greatly.
- For example, Argentina’s AFIP requires registration of export-contracts pre-shipment under Resolution 5872/2026. ([servicioscf.afip.gob.ar](https://servicioscf.afip.gob.ar/publico/sitio/contenido/novedad/ver.aspx?id=5819&utm_source=openai))
- Understand origin certificates, phytosanitary or quality certificates depending on goods.
## Transfer Pricing and Related Party Transactions
If selling to related parties abroad, be ready to demonstrate arm’s-length pricing:
- Keep documentation of comparable transactions.
- Use local benchmarks.
- Be aware of local transfer pricing rules: Colombia, Argentina, and Mexico update their regimes frequently.
## Example: Setting Up a Textile Exporter in Argentina
You register as S.A., ensure all export contracts are registered via AFIP's **Formulario F. 2669** under new Resolution 5872. You pay zero VAT on shipped textiles but prepare transfer pricing documentation for sales to affiliated distributor abroad. You retain costs and receipts rigorously for customs classification.
## Actionable Steps & Pitfalls to Avoid
- Register export contracts **before** shipment where required (don’t ship first, register later).
- Use the simplified electronic procedures where available (as in Argentina).
- Factor in delays and local bureaucracy: planning ahead helps with financing and cash flow.
- Avoid undervaluing goods to reduce duties: customs audits can nullify savings.
By choosing the right entity, staying compliant with VAT/export rules, and documenting properly, your export business in Latin America can be structured for growth, compliance, and tax efficiency.