By Travis Kliever
Updated February 25, 2026

Doing Business in Aruba

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Aruba is an autonomous island of the Kingdom of the Netherlands, located just off the coast of Venezuela. Its deep-water ports, proximity to North American and South American markets, and world-class telecommunications make it a good location for trade and logistics.

It stands out in the Caribbean with one of the region’s highest standards of living and a GDP per capita of nearly US$34,000. While tourism remains the primary economic driver, the Aruban government is actively pursuing diversification into high-value sectors like technology, finance, and sustainable industries.

Thinking about growing your team in Aruba? This guide walks you through everything you need to know, from setting up your business and understanding taxes to local labor laws and workplace culture.

Aruba Guides

Business Structures

The most common and secure legal structures are the Corporation (N.V.) and the Limited Liability Company (V.B.A.) for international companies. Both are established through a civil notary and provide limited liability, meaning your personal assets are protected from business debts. Every N.V. or V.B.A. must have at least one local managing director, which can be an initial challenge for foreign businesses.

The Registration Roadmap

The setup process requires working with two primary government agencies:

Aruba Chamber of Commerce (KVK): Your first step is to register your business in the official Trade Registry. You must submit documents like a valid identification, a Civil Registry extract, and proof of a local business address through the Chamber’s digital platform.
Department of Economic Affairs (DEACI): After registering with the KVK, you must apply to DEACI for the necessary licenses. This includes a Business License for the company to operate and a Director’s License for any foreign managing directors.

Hiring any foreign employees requires separate work permits, which are typically only granted if no qualified local candidates are available. Under the Ordinance on the Establishment of Businesses, foreigners or foreign‑controlled companies need a business establishment licence.

A foreign managing director must obtain a director’s licence. The Department of Economic Affairs assesses applications and requires an interview and advice from the Chamber. Sector‑specific licences may also be required.

Labour Laws

Aruba’s labour rules are mostly present in the Labour Ordinance and the Vacation Ordinance.

Key points:

Working Hours: A standard workweek is 42.5 hours over five days. Overtime is strictly compensated at 150% of the normal wage for work on weekdays and Saturdays, and 200% for Sundays and public holidays.
Leave and Holidays: Employees are legally entitled to a minimum of 15 paid vacation days annually, plus 11 official public holidays.
Termination and Severance: Employment in Aruba is not “at-will.” Terminating an indefinite contract requires a valid reason and, in many cases, prior permission from the Department of Labor (DAO) or a court order. Employers must also adhere to statutory notice periods based on length of service and provide severance pay calculated according to a legal formula.

Taxation

Business Taxes

Corporate Income Tax (CIT): The standard rate is 22% on profits.
Turnover Tax (BBO/BAZV/BAVP): A 7% tax is levied on the turnover of most goods and services supplied in Aruba. This tax is also applied to imported goods to ensure a level playing field for local businesses.
Dividend Withholding Tax: A 10% tax applies to dividend distributions.

Personal Income Tax

Aruba uses a progressive PIT system. A 2025 reform set the first bracket at 0%; thus, incomes up to about 64,930 Aruban Florin (Afl), taking into account the tax‑free allowance, pay no income tax. Higher bands are taxed at 21%, 42% and 52% respectively.

Social Security Contributions

Employers contribute 10.5% of gross monthly payroll for the old‑age pension plus 0.5% for survivors’ insurance, while employees contribute 5% and 0.5% respectively. Mandatory occupational pension requires employers to contribute at least 3 % of wages.

Aruba’s Tax Incentives

The Free Zone: Companies operating within the designated Free Zone at Oranjestad and Barcadera, and engaged in qualifying international trade or services, pay a profit tax of just 2%. They also benefit from 0% import duties, 0% turnover tax on foreign sales, and 0% dividend tax.
Expat Incentives: To attract skilled foreign talent, the government provides generous tax exemptions for expatriates. These can include tax-free allowances for housing, children’s education, annual airline tickets, and relocation expenses.

Work Permits

Foreign nationals require a work permit issued by the Department of Labour and a residence permit from the Department of Immigration. Applicants must remain outside Aruba during the process, and employers act as guarantors. After ten years of legal residence, individuals may apply for an indefinite permit.

Best Cities and Infrastructure

Oranjestad – Aruba’s capital and commercial centre offers modern office space, international banking facilities, and a free‑zone area near the port. The Queen Beatrix International Airport provides direct flights to North America, Europe, and South America. The nearby Barcadera Business Park boasts a multi‑cargo sea terminal and customs on‑site; leases are available for logistics, warehousing, and maritime services.

San Nicolas – The island’s second city is growing as an industrial hub with petrochemical facilities and the import/export port. Government programmes aim to revitalise the area with renewable energy and cultural projects, creating opportunities for investors in niche tourism and creative industries.

Working with an Employer of Record (EOR) in Aruba

Foreign businesses may find Aruba’s work permit, tax, and labour regulations challenging. Partnering with an Employer of Record (EOR) allows companies to hire staff without establishing a physical presence in a country or region.

The EOR acts as the legal employer, handles payroll, tax withholding, benefits, and compliance, while the client company manages day‑to‑day work. Using an EOR helps ensure local employment contracts meet labour and immigration requirements and mitigates compliance risks.

How RemotePad Helps

RemotePad offers resources to support international expansion. Our Country Guides provide up‑to‑date regulatory information and practical tips. The Best Employer of Record and Best Global PEO rankings review leading providers, while the Global Payroll Calculator helps estimate total employment costs.

Whether you plan to set up a company or hire staff through an Employer of Record (EOR), RemotePad’s tools and articles equip you with the knowledge needed to do business successfully in Aruba.

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