Will you be taxed twice? Double taxation when investing in Paraguay

"Will I pay tax in Paraguay AND in my country?" It is every foreign investor's first question. Here is the answer, with official data (REDIEX, 2025).

The key: Paraguay is territorial

Paraguay's tax system (Law 6,380/2019) taxes only Paraguay-source income. In plain terms: Paraguay only taxes what you earn inside Paraguay — not your income or assets abroad. That, by design, already avoids much of the double taxation problem.

What is taxed and at what rate

• Rent and gains from a property in Paraguay: these are Paraguay-source income. If you are a non-resident, they are taxed under the Non-Resident Income Tax (INR), 15% on net income.
• If you obtain residency and file as a resident, the general scheme applies (personal income tax at 8% to 10%).

Either way, these are among the lowest rates in the region.

Double-taxation treaties (DTTs)

On top of the territorial system, Paraguay has double-taxation treaties (DTTs) with several countries and keeps expanding that network. DTTs reduce or eliminate the tax you would otherwise pay twice on the same income, and add legal certainty. If your country has a DTT with Paraguay, your accountant can apply the relevant credit or exemption.

Your investment is protected

Paraguay has signed Investment Protection Agreements (IPAs) with over 20 countries — including Argentina, Spain, Germany, Italy, Portugal, France and the United States. It is also a member of MIGA (the World Bank's investment guarantee agency) and ICSID (international investment dispute arbitration).

Talk to us

At Rootgold Realty we guide you on the real estate side and connect you with tax and legal advisors so you structure your investment as efficiently as possible for your country. Get in touch.

Informational guide based on official sources (REDIEX, 2025). Not tax advice. Whether a DTT exists and its details depend on your country of residence; confirm with an accountant before investing.