How much does it really cost to hire in Peru in 2026?

Peru's true employer cost runs well above the base salary. The driver is mandatory pay that arrives outside the monthly run. Two full bonus salaries a year, a CTS savings fund worth roughly one more, and EsSalud health cover on top. Together these can add 35% to 45% to a base salary before you reach the Teamed fee. Pension is funded by the employee, so it is not an employer line.

These figures are illustrative. The two bonuses and CTS are each modelled as one monthly salary, the standard rule, and EsSalud is the verified 9% rate applied to the base. They are not statutory figures. Your exact CTS deposit depends on the computable salary base and a share of the bonuses, so confirm the live number per employee.

Add Teamed from $599 per employee per month and the total rises. Use the Employer Cost Calculator to run your own salary figures.

1. Start with the base salary

   Confirm the agreed monthly base salary in soles. Every other Peru cost line is built from this number, including both bonuses and the CTS deposit.

2. Add the two mandatory bonuses

   Budget a July bonus and a December bonus, each worth one full monthly salary. They are required by law and paid to every employee regardless of performance.

3. Fund the CTS savings deposits

   Set aside about one more monthly salary across the year for CTS. It is deposited in two halves, in May and in November, into the employee's account.

4. Apply EsSalud and withhold tax

   Add the EsSalud employer health contribution on the full salary with no ceiling. Withhold income tax and pension from the employee and remit both monthly to SUNAT.

5. Plan exit and probation from day one

   Model the arbitrary dismissal indemnity as a possible exit cost, and make confirmation decisions inside the short standard probation window before full protection applies.

The July and December bonuses (gratificaciones)

Under Ley N. 27735, every employee receives two yearly bonuses. The July bonus is paid for Fiestas Patrias and equals 1 month of salary. The December bonus is paid for Navidad and equals 1 month of salary. These are the Peru equivalent of a 13th and 14th salary, and they are not tied to performance. Budget them as fixed annual cost from the first hire, not as discretionary extras.

CTS (Compensacion por Tiempo de Servicios)

CTS is a severance savings fund the employer builds up while the employee works. It is not paid to you and it is not optional. The employer deposits half a computable monthly salary in early May, covering November to April, and half again in early November, covering May to October. Across a full year that nets to about one extra monthly salary. The deposit goes into the employee's CTS account at a bank, and the employee draws on it when they leave.

Why this changes the cost model

In many markets the annual cost is twelve monthly salaries plus social charges. In Peru you are closer to fifteen monthly salaries before social charges, once the two bonuses and CTS are counted. A salary that looks affordable on a monthly basis is roughly a quarter more expensive once these mandatory items are added. The number to plan around is the all-in annual cost, not the monthly base.

EsSalud (employer health contribution)

The employer pays EsSalud at 9% of the employee's salary every month. There is no earnings ceiling, so the contribution rises with salary. EsSalud funds the public health system and the temporary incapacity subsidy that kicks in when sick leave runs long. This is the main recurring social cost an employer carries in Peru.

Pension is funded by the employee

Pension contributions in Peru come out of the employee's pay, not the employer's. Workers choose between the public system (ONP) and a private pension fund (AFP). The rates differ between the two, and the AFP option layers a fund contribution, a commission, and an insurance premium. Because the figures vary by provider and are deducted from the employee, treat pension as a payroll deduction you administer, not as an employer cost line in your budget.

What the employer remits

Even where a charge is the employee's, the employer is the one who calculates, withholds, and remits it on the monthly electronic payroll. Peru runs a monthly pay cycle, and the employer files the electronic payroll (PLAME) to SUNAT each month. Getting the remittance right and on time matters more for your risk than the rate itself.

Income tax on salary (renta de quinta categoria) is the employee's cost, but the employer administers it. Every month the employer calculates the tax, withholds it, and remits it to the tax authority SUNAT through the monthly electronic payroll. Income tax is not an employer cost in cash terms. It becomes a liability only when the employer miscalculates or misses the filing.

The 2026 labour income tax bands

The bands are set in UIT, a tax reference unit. For 2026 one UIT is worth PEN 5,500/year, raised from S/5,350 the year before. Before tax applies, the law deducts a fixed 7 UIT from annual labour income, so lower earners pay little or nothing.

Source: SUNAT: TUO Ley del Impuesto a la Renta, Art. 53

The top marginal rate is 30% on labour income above 45 UIT a year. Because the bands are pegged to the UIT, and the UIT rose for 2026, the thresholds in soles all moved up. The employer's job is to apply the current UIT correctly across the year and remit on time.

Annual leave and public holidays

Every employee earns 30 days of paid leave for each completed year of service under Decreto Legislativo 713. Peru also has 16 days national holidays a year. The standard working week is 48 hours across 8 hours a day. Overtime adds at least 25% to the hourly rate for the first two hours and at least 35% on each hour after that.

Sick pay and maternity leave

When an employee is off sick, the employer pays full salary for the first 20 days. After that, the EsSalud subsidy takes over for the employee, up to a long statutory limit. Maternity leave is 98 days in total, split evenly before and after the birth, paid through the EsSalud subsidy rather than directly by you. Budget the first 20 days of any illness as a direct employer cost.

CTS and dismissal indemnity on exit

CTS is paid out to the employee when they leave, but you have already funded it through the year, so it is not a fresh cost at exit. The cost that can surprise you is the arbitrary dismissal indemnity. If a dismissal has no valid cause, the employer owes 1.5 months of salary for each complete year of service, capped at 12 months of salary. There is no statutory paid notice period for an employer dismissal in Peru, so the protection is monetary, not time based.

Probation is shorter than you think

Standard probation is only 3 months, after which the employee gains full protection against arbitrary dismissal. It can extend to 6 months for qualified or trusted staff, and to a year for management roles, but only by written agreement. Plan your assessment and confirmation decisions inside the 3 months default unless you have a documented extension in place.

Real HR and legal experts handle your Peru hires from the first offer letter through every monthly SUNAT remittance and the May and November CTS deposits. An actual person, not a chatbot or a pooled queue. There is no setup fee and no exit fee. Every employer cost passes through at cost, itemised on every invoice. You see the EsSalud line, the July and December bonus lines, and the CTS deposit. Nothing is buried in the management fee.

EOR payroll, contractor onboarding, and entity setup all live on one platform. A Peru contractor who converts to employment keeps their record. That same employee can graduate from EOR to your own Peruvian entity without switching systems. EOR is the right structure for a first Peru hire, until it isn't. Teamed plans the move with you when the model no longer fits. Start from the Peru hiring overview or run the Employer Cost Calculator to see the full picture.