How much tax do you pay for a house in Arequipa?

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THE LATINVESTOR

A team specialized in real estate investing in LATAM countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Arequipa. If you'd like to learn more about us, you can check our presentation page.

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At The LatinVestor, we explore the Peruvian real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Lima, Arequipa, and Cusco. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What is the official annual property tax rate in Arequipa for residential houses?

The annual property tax in Arequipa follows a progressive rate structure based on the property's assessed value, not its market price.

Properties valued up to 15 UIT (S/80,250 as of September 2025) are taxed at 0.2% of their assessed value. For properties valued between 15 and 60 UIT, the portion exceeding 15 UIT is taxed at 0.6%. Properties worth more than 60 UIT (S/321,000) pay 1.0% on the value exceeding this threshold.

The UIT (Unidad Impositiva Tributaria) for 2025 is set at S/5,350, which serves as the base unit for calculating tax brackets. This progressive system ensures that higher-value properties contribute proportionally more to municipal revenues.

Most residential properties in Arequipa fall within the first two tax brackets, meaning effective tax rates typically range between 0.2% and 0.6% of assessed value.

How is the assessed value of a house in Arequipa calculated?

The assessed value, known as "autovaluo," is determined annually by Arequipa's municipal authorities and is consistently lower than market prices.

Municipal assessors consider factors including property size, building age, construction materials, recent improvements, and general local real estate conditions. The assessment does not reflect current listing prices or recent transaction values in the area.

Property owners receive an annual assessment notice that details how their property's value was calculated. This assessed value typically ranges from 60% to 80% of the actual market value, providing some relief compared to market-based taxation systems.

If you disagree with your assessment, you can appeal the decision through the municipal office, though successful appeals require substantial documentation proving the assessment exceeds reasonable parameters.

What are the minimum and maximum annual property tax payments for an average house?

Annual property tax payments in Arequipa vary significantly based on property value and location within the city.

For a modest home assessed at 10 UIT (S/53,500), the annual tax equals S/107 at the 0.2% rate. Mid-range properties assessed at 30 UIT (S/160,500) pay approximately S/570 annually, calculated as S/321 for the first 15 UIT plus S/249 for the remaining 15 UIT at 0.6%.

Higher-value homes assessed at 70 UIT (S/374,500) face annual taxes around S/2,012, broken down as S/161 for the first 15 UIT, S/1,445 for the next 45 UIT, and S/535 for the portion exceeding 60 UIT.

Most average residential properties in Arequipa pay between S/150 and S/1,500 annually, depending on neighborhood desirability, property size, and construction quality.

Are there progressive tax brackets for property value in Arequipa?

Yes, Arequipa applies a three-tier progressive tax system that increases rates as property values rise.

Value Range (UIT)	Tax Rate	Value Range (Soles)
0 to 15 UIT	0.2%	S/0 to S/80,250
15.01 to 60 UIT	0.6%	S/80,251 to S/321,000
Over 60 UIT	1.0%	Over S/321,000
Luxury properties (100+ UIT)	1.0%	Over S/535,000
Commercial rate comparison	Up to 1.5%	Varies by use

How often are property taxes re-assessed in Arequipa?

Property values in Arequipa are re-assessed annually by municipal authorities, meaning your tax bill can change each year.

The municipal government conducts systematic reviews of property values every January, taking into account local market developments, infrastructure improvements, and changes to individual properties. Property owners receive assessment notices typically in February or March.

Significant neighborhood improvements like new roads, utility upgrades, or commercial development can trigger mid-year reassessments that affect the following year's taxes. Property renovations or additions must be reported and may result in higher assessments.

The annual reassessment process allows municipalities to capture changing property values, though assessed values typically lag behind rapid market changes by 1-2 years.

Is there an additional municipal tax or surcharge in Arequipa?

Arequipa does not impose significant additional municipal taxes beyond the standard property tax for most residential properties.

Some minor supplementary fees may apply for specific municipal services like waste collection, street lighting, or special public works projects, but these typically add less than S/100 annually to your tax bill.

The municipality occasionally levies temporary assessments for major infrastructure projects, but these require public consultation and are usually spread over multiple years. Property owners receive advance notice of any additional charges.

It's something we develop in our Peru property pack.

Do you need to pay a transfer tax when buying a house in Arequipa?

Yes, buyers must pay a transfer tax called "Impuesto de Alcabala" equal to 3% of the property's declared value minus 10 UIT.

The tax applies to the higher of either the property's assessed value or the actual purchase price, ensuring the municipality captures revenue based on real transaction values. For a property selling for S/300,000, the transfer tax equals S/7,395 (3% of S/300,000 minus S/53,500).

This tax is paid by the buyer during the property transfer process and must be settled before the deed can be registered with SUNARP (National Registry). The 10 UIT exemption (S/53,500 in 2025) provides some relief for lower-value properties.

Transfer tax payments are made directly to the municipal treasury and cannot be financed or deferred, requiring buyers to budget for this upfront cost.

What are the notary and registration fees when purchasing a house?

Notary and registration fees for property purchases in Arequipa typically total 1.5% to 2.5% of the property's purchase price.

1. Notary fees range from 0.5% to 1% of the property value for document preparation and transaction oversight2. SUNARP registration fees cost 0.3% to 0.5% of the purchase price for title registration3. Legal representation fees add 1% to 2% if you hire an attorney for the transaction4. Document preparation and verification costs approximately S/500 to S/1,0005. Title search and due diligence fees range from S/300 to S/800

For an average home costing S/350,000, total closing costs typically range from S/5,250 to S/8,750, not including the transfer tax. These fees are generally paid at closing and cannot be rolled into mortgage financing.

Working with experienced local professionals helps ensure all fees are properly calculated and paid, avoiding delays in the property transfer process.

Are there any discounts or exemptions for specific groups in Arequipa?

Arequipa offers limited property tax exemptions, primarily targeting retirees and owners of very low-value properties.

Pensioners who own properties assessed below certain UIT thresholds may qualify for partial or total property tax exemptions, though specific requirements vary by municipality. Low-income homeowners with properties valued under 5 UIT sometimes receive automatic exemptions.

No standard exemptions exist for first-time buyers at the national or municipal level. Military veterans and disabled persons may qualify for reductions under specific circumstances, requiring documentation and annual renewal.

Property owners should contact Arequipa's municipal tax office directly to inquire about available exemptions, as eligibility criteria and application processes change periodically based on local ordinances.

How much income tax do you pay on rental income in Arequipa?

Rental income from properties in Arequipa is subject to a flat 5% tax rate on gross rental income for individual property owners.

This tax applies to all rental income regardless of your residency status, as long as the income originates from Peruvian property. No deductions are allowed for maintenance, management fees, or depreciation under this simplified tax regime.

For a property generating S/2,000 monthly rent (S/24,000 annually), the annual income tax equals S/1,200. This tax is paid quarterly through the SUNAT tax system and must be reported even if you're a non-resident.

Property owners can choose between the simplified 5% rate or the standard income tax regime with deductions, though most find the flat rate more advantageous and administratively simpler.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Peru versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

What penalties apply if you don't pay property tax on time?

Late property tax payments in Arequipa incur monthly interest charges plus potential flat penalties that compound over time.

The municipality typically charges monthly interest rates linked to Peru's legal interest rate for overdue taxes, which currently runs approximately 1.2% to 1.5% per month. A flat penalty may also apply, usually ranging from 10% to 25% of the outstanding tax amount.

Properties with taxes overdue by more than two years may face liens, preventing future sales or transfers until all obligations are settled. The municipality can also initiate collection proceedings that may result in property seizure for persistent non-payment.

Property owners receive multiple notices before enforcement actions begin, typically including a final warning 30-60 days before legal proceedings commence.

What is the average total annual cost for homeowners in Arequipa?

The total annual cost of property-related taxes and fees for homeowners in Arequipa typically ranges from S/1,800 to S/2,500 for average properties.

Cost Category	Annual Amount	Notes
Property Tax	S/200 - S/600	Based on assessed value
Municipal Fees	S/50 - S/150	Waste, lighting, services
Amortized Purchase Costs	S/1,500 - S/2,000	Transfer tax + fees over 10 years
Rental Income Tax (if applicable)	5% of gross rent	S/600 - S/3,000 typically
Insurance (recommended)	S/300 - S/800	Property and liability coverage
Total for Owner-Occupied	S/1,800 - S/2,500	Excluding rental income tax
Total for Rental Property	S/2,400 - S/5,500	Including 5% rental tax

It's something we develop in our Peru property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Orbit Tax - Peru Tax Unit Value 2025
2. ESales International - Real Estate Investment Peru
3. Global Property Guide - Peru Taxes and Costs
4. RGB Avocats - Real Estate Transaction Tax Peru
5. The LatinVestor - Buy Land Peru
6. The LatinVestor - Peru Buy Property
7. PWC Tax Summaries - Peru Personal Income
8. The LatinVestor - Peru Real Estate Trends