Your Guide to Paraguay Residency & Relocation

Paraguay, business owner: a sole trader on IRE SIMPLE pays 10% on the lower of real profit or 30% of turnover, so roughly 3% (few costs) to 10% (thin margins) of profit, and no IDU when taking the profit privately (Ley 6380/2019, art. 26). IRE SIMPLE is for businesses in which capital matters and whose turnover last year was at most Gs. 2 billion; income from your own work falls under IRP. For an EAS, and for any business above the limit, we use the general regime: 10% on profit plus 8% IDU on what is paid out.

Paraguay, freelancer: personal services fall under IRP once gross income passes Gs. 80 million a year: 8% on the first Gs. 50 million of net income, 9% up to Gs. 150 million and 10% above. Net income is gross income minus deductible spending, including personal and family living costs, health and education, when the invoices are issued to your RUC. Work you do from Paraguay for a foreign client is Paraguayan-source income, and the service is also subject to 10% IVA unless it is a digital service used abroad.

Investments: Paraguay taxes income by source. Foreign interest, dividends and capital gains you hold personally are not taxed in Paraguay; through a Paraguayan company they fall under IRE. Your home country may still tax dividends from home-country companies, such as the 15% Dutch dividend tax or 26.375% in Germany, and without a treaty nothing reduces that. An unexplained increase in your wealth can be taxed. Paraguay has no wealth tax and no inheritance tax.

Pensions: with no tax treaty, your home country keeps taxing the pension under its rules for non-residents, which is what the Paraguay column shows. Paraguay does not tax a foreign pension.

Leaving has its own tax rules, none of which are in the figures. Germany: exit tax on shareholdings of 1% or more after 7 of the last 12 years of residence (§6 AStG); German nationals who move to a low-tax country such as Paraguay and keep significant economic interests in Germany remain subject to extended German tax for the year of departure plus 10 years (§2 AStG); German inheritance tax follows German nationals for 5 years, or 10 in §2 AStG cases. Netherlands: a protective assessment on substantial shareholdings that stays open for good, and on pensions for 10 years; Dutch nationals remain subject to Dutch inheritance and gift tax for 10 years. France: exit tax on shareholdings worth €800,000 or more. Belgium: capital gains tax if you sell within 2 years of leaving. UK: gains and certain payouts can be taxed if you return within 5 years, and inheritance tax can follow long-term residents for up to 10 years.

Home-country figures use 2026 rules (UK 2026/27) for a single person without children or church tax, income tax only. Business owner: a company that pays out its full profit: Netherlands BV plus Box 2; Germany GmbH with trade tax at the average 438% rate and the cheaper of the 26.375% flat tax or the partial-income method; Belgium 25% plus 30%; France 15% and 25% corporate tax plus the 31.4% flat tax; UK corporation tax plus dividend tax. Freelancer: income tax on the full amount, with the Dutch self-employed deduction, SME profit exemption and tax credits. Investments: Netherlands Box 3, Germany 26.375% or the normal rates if lower, Belgium 30%, France 31.4%, UK as dividends. Social security and health insurance contributions are not included, except the Dutch national insurance premiums that are part of the Box 1 rate. For freelancers the contributions left out are largest in Belgium, France and Germany.

All amounts are rounded indications based on public information, not personal tax, legal or financial advice. Rates, thresholds and rules change and differ per situation. Converted at the Banco Central del Paraguay rate of 30 October 2026: 6,628 guaraníes per euro and 7,960 per pound. Have your situation reviewed by a qualified adviser before acting.