1) Download the Library Files ( A zip folder )
2) Paste these two files ARDUINOTEP.LIB and ARDUINOTEP.IDX in to Library folder
3) if you are using Proteus 8 then Library folder will be within the data Folder (Proteus 8 Professional\Data\LIBRARY )
4) Now open Proteus software and search for Arduino TEP
5) Open arduino Software and Click on file and then Preference and tick both of the Option "Compilation and Upload " After writing your code, click on compile then you will get the Link of Your Hex file at the Output go to that place and get your Hex file.
6) How to Add Hex file in to Arduino so it,s easy Double click on arduino and then click on program File and Add your Hex file .
7) it,s time to play with arduino in proteus enjoy ........Love you All .
Images and library courtesy theengineeringprojects.com