Paraguay tax
Special regime for new residents: Paraguay territorial personal income tax: Paraguayan-source income only.
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Special regimes for new residents
Special regime
Paraguay territorial personal income tax (IRP): Paraguayan-source income only
Tax relief
Details
- Limit: PYG 50M/yr ≈ $8,750
Paraguay's Impuesto a la Renta Personal (IRP) taxes only Paraguayan-source income of resident individuals: 8%, 9% and 10% progressive bands on services income and 8% flat on capital income. 2
Taxed on
Services income (employment and independent): progressive bands, 8% up to G 50,000,000 net income, 9% from G 50,000,001 to G 150,000,000, 10% from G 150,000,001 upward. Capital income and gains: 8%. Only Paraguayan-source income is in the base (arts. 48, 69, 60).
Who it applies to
- Applies to individuals, national or foreign, resident in Paraguay (art. 49); no application is required to have foreign-source income outside the IRP base.
- Art. 48 treats as Paraguayan-source: activities carried out in Paraguay, assets located in Paraguay, rights used economically in Paraguay, Paraguay-sourced capital income, and services performed abroad by IRP taxpayers when rendered to IRE or IRP taxpayers.
Exclusions
- Personal services performed outside Paraguay for IRE or IRP taxpayers (businesses or individuals subject to Paraguayan income tax) are treated as Paraguayan-source and taxable (art. 48 no. 3).
- Dividends and profits of Paraguayan companies are subject to the separate IDU: 8% for resident recipients, 15% for non-residents (arts. 42-43).
- Art. 6 (company income tax, IRE) also treats some activities carried out abroad as Paraguayan-source unless income tax of an equal or higher rate was paid abroad; this applies to IRE taxpayers.
Limits
- PYG 50,000,000 a year (≈ $8,750) · Upper limit of the 8% band of net services income (art. 69)
- PYG 150,000,000 a year (≈ $26,200) · Net services income from G 150,000,001 is taxed at the 10% band; band from G 50,000,001 to G 150,000,000 is 9%
- PYG 80,000,000 a year (≈ $14,000) · A taxpayer whose gross income from personal services does not exceed this amount in the fiscal year must meet the formal obligations but does not have to pay the tax (art. 69, last paragraph).
Tax residence
Law 6380 makes individuals resident in Paraguay the IRP taxpayers (art. 49) and does not itself define residence for individuals; the definition is left to the regulation.
Visas
Tax residence, not visa type, determines IRP liability; the territorial base applies to all residents.
Other taxes
VAT (IVA) and social-security contributions apply separately.
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Standard rules and foreign-source income
Standard rules
Paraguay personal income tax (IRP): Paraguayan-source income
Details
- Limit: PYG 50M/yr ≈ $8,750
IRP taxes individual residents on Paraguayan-source income only: capital income and gains at 8%, and personal services income on an 8% to 10% scale; services performed abroad count as Paraguayan-source only when provided to taxpayers of IRE or IRP. 1
Taxed on
Capital income and gains (8%) and personal services income of residents, limited to Paraguayan-source income.
Who it applies to
- Individuals, national or foreign, resident in Paraguay.
Exclusions
- Income earned from activities outside Paraguay for clients not subject to IRE or IRP is not Paraguayan-source under art. 48.
- Interest on public-debt securities and certain gains are exempt (art. 56).
Limits
- PYG 50,000,000 a year (≈ $8,750) · Net personal-services income up to this amount is taxed at 8% (art. 69).
- PYG 150,000,000 a year (≈ $26,200) · Net personal-services income from PYG 50,000,001 (≈ $8,750) to this amount is taxed at 9%; from PYG 150,000,001 (≈ $26,200) at 10% (art. 69).
- PYG 80,000,000 a year (≈ $14,000) · A taxpayer whose gross income from personal services does not exceed this amount in the fiscal year must meet the formal obligations but does not have to pay the tax (art. 69, last paragraph).
Tax residence
Law 6380 makes individuals resident in Paraguay the taxpayers (art. 49) and does not itself define residence for individuals; the definition is left to the regulation.
Visas
No visa category changes the territorial IRP rule; investor permanent residence is a migration status only.
Other taxes
VAT (IVA) and social-security contributions apply separately.
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VAT, social security and other taxes
- VAT (IVA) and social-security contributions apply separately.
Questions people ask
Who qualifies for Paraguay territorial personal income tax: Paraguayan-source income only?
Applies to individuals, national or foreign, resident in Paraguay (art. Tax residence, not visa type, determines IRP liability; the territorial base applies to all residents.
≈ USD figures are approximate: daily reference rates from ExchangeRate-API, dated 12 Oct 2026, refreshed when the site is updated.
Sources (2)
Official sources
- Ley 6380/2019 de modernización y simplificación del sistema tributario nacional (IRP arts. 47-60) · Biblioteca y Archivo Central del Congreso · checked 2026-10-12 · published 2019-12-23
- Ley N° 6380/2019 de Modernización y Simplificación del Sistema Tributario Nacional (arts. 47-69, Impuesto a la Renta Personal) · Biblioteca y Archivo Central del Congreso Nacional (BACN), Paraguay · checked 2026-10-12 · published 2019-09-25