Paraguay runs a 10% corporate rate, 10% VAT and an 8% dividend tax — simple on paper. The value is in getting it right: clean books, monthly filings with DNIT, and an honest read of what the territorial system does and does not exempt.
Free first call. Fixed quote within one business day.
| Tax | Rate | Notes |
|---|---|---|
| Corporate income — IRE | 10% | Flat, on net profit. |
| VAT — IVA | 10% / 5% | 10% standard; 5% on some goods. |
| Dividends — IDU | 8% / 15% | 8% to resident shareholders; 15% abroad. |
| Personal income — IRP | 8–10% | Progressive; 8% on capital gains. |
| Non-resident — INR | 15% | Effective, on presumed net income. |
Law and practice: Rates and taxes under Ley Nº 6380/2019 (Modernisation of the Tax System), administered by DNIT (formerly SET). Rates as of October 2026; reduced and sector-specific regimes exist. General information, not advice.
Here is the part the brochures skip. Paraguay’s territorial principle is real — but it is strongest for individuals. At the corporate level, the 2019 reform pulled certain foreign income of a Paraguayan company into the tax base at 10%.
Individuals
Genuinely foreign-source income of a resident individual generally stays outside the Paraguayan base.
Companies
Since 2019, foreign dividends and certain foreign income of a Paraguayan company can be taxed at 10% IRE.
Distribution
IDU applies when profits are paid out — 8% to residents, 15% abroad — on top of IRE.
Substance matters
A substance-over-form rule lets DNIT recharacterise arrangements with no economic reality.
Law and practice: Territoriality and source rules: Ley Nº 6380/2019; anti-abuse / substance-over-form in Ley Nº 125/91 as reinforced by Ley Nº 6380/2019. We map which of your income is in and out of the Paraguayan base in the brief. Rules as of October 2026.
Indicative only — it applies the headline rates to your figure. Your real position depends on sources, deductions and treaties, which we confirm in the brief.
Bookkeeping
Clean, current books in the format DNIT and banks expect.
Monthly filings
IVA and IRE obligations prepared and filed on time, every month.
Annual accounts
Year-end financial statements and the annual IRE return.
Payroll & IPS
Payroll, social security (IPS) and employee withholdings, if you hire.
Dividends & IDU
Correct IDU handling when you distribute — 8% or 15% — with the paperwork.
DNIT & representation
We deal with DNIT, notices and your RUC so you don’t have to.
IVA return and any withholdings filed with DNIT.
IPS and employee withholdings, when you have staff.
IDU declared and paid when dividends are paid out.
Financial statements and the IRE return for the year.
Corporate income tax (IRE) is a flat 10%, which is genuinely low. But VAT, dividend tax (IDU) and payroll obligations also apply, so the all-in position depends on how you distribute and operate.
For individuals, genuinely foreign-source income generally stays outside the base. For companies, the 2019 reform changed this — certain foreign income of a Paraguayan company is taxed at 10%. We map your specific sources in the brief.
IDU: 8% when distributed to resident shareholders, 15% when distributed abroad — on top of the 10% IRE already paid. Reinvested profit carries no IDU.
IVA is monthly; IRE is annual with advance payments; IDU is due on distribution. We handle the full calendar so nothing is missed.
DNIT (Dirección Nacional de Ingresos Tributarios), which merged the former SET and customs. We act as your point of contact with it.
Exporters can generally recover input VAT credits. We set up the records so the refund mechanism actually works for you.
Tell us your activity and rough figures. We’ll give an honest read of your Paraguay tax position and a fixed quote within one business day.
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