🇵🇾 Paraguay · Taxes
Taxes in Paraguay
One of the mildest tax systems in the world: a flat 10% rate on both personal income and corporate profit. Here are the main rules.
Paraguay is one of the few countries with a flat 10% rate on both personal income and corporate profit. Below are the residency rules and how dividends are taxed.
Who is a tax resident
An individual is considered a tax resident of Paraguay if they spend more than 120 days in the country within a year.
Main tax rates
- Personal income tax — 10%.
- Corporate income tax — 10%.
How dividends and other income are taxed
50% of the income received as dividends, profits, and any other result obtained as a shareholder or partner of companies subject to the tax on profits from commercial, manufacturing, or service activities (ITCMSA), the tax on profits from livestock sales in the domestic market (ITDMC), or the tax on profits from agricultural activities, is subject to personal income tax.
Any other income received from a Paraguayan source is also taxed, provided it exceeds 30 times the minimum monthly wage.
Your exact obligations depend on the structure of your income. We review your situation on a consultation.
Why Paraguay's tax system is convenient
One low flat rate
10% on both personal income and corporate profit, with no progressive scale.
Mild residency rule
Spending more than 120 days a year in the country is enough to become a tax resident.
Partial dividend exemption
Only 50% of dividend and profit income is subject to personal income tax.
Threshold for small income
Other Paraguay-source income is tax-free until it exceeds 30 times the minimum monthly wage.
FAQ
What is the personal income tax rate in Paraguay?
What is the corporate income tax rate?
Who counts as a tax resident of Paraguay?
How are dividends taxed?
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