Answer
Yes, when beginning the legalization process in Uruguay, you may need to immediately register as a sole proprietor, set up a company, or formalize an employment relationship in order to pay BPS. An economic connection to the country is demonstrated through social contributions, including BPS and FONASA, when a person is employed or conducts business.
The point is not registration as a box-ticking exercise, but ensuring that the activity is genuine and consistent with the income. If a person is employed, that is one route; if they provide services or run a business, registration, invoices, contracts, and mandatory payments are required.
A registered entity with no transactions does not replace income or make the situation convincing. Therefore, the choice between a sole proprietorship, a company, and formal employment should follow the actual work arrangement. It is important that the name, period, payments, and documents match and do not create contradictions.