Move to Paraguay and become tax resident

Overview

The Republic of Paraguay is a land-locked South American country and member of Mercosur and Unasur.
Its territory comprises two different regions separated by the river Paraguay. Although it is a land-locked state, it has ports on the Paraguay and Parana rivers that give it an outlet to the Atlantic Ocean through the Parana – Paraguay waterway.

Its official languages ​​are Spanish and Guarani and its official currency is the Paraguayan Guarani (PYG).
The country offers great social security and a very low delinquency rate.

Paraguay’s cost of living is generally considered to be lower than in many other South American countries. However, it will inevitably vary depending on the city and region you decide to live in, and your chosen lifestyle. Asuncion is 60% less expensive than Milan and 75% less expensive than New York.

The cost of renting a one-bedroom apartment starts from $300 and up and the cost of renting a three-bedroom apartment starts at $700 and up.

Advantages

• The most attractive tax system in South America;
• Lower cost of living than in Europe and North America;
• Great hospitality: the atmosphere in Paraguay is very peaceful and the country is friendly and open to expats people;
• Delicious and diverse cuisine;
• Stunning and unique landscapes that will appeal to nature lovers and photo enthusiasts;
• An open and dynamic economy.

Asuncion, Paraguay

Weather

Paraguay has an agreeable climate with not too many extremes—summer from October through March, and winter from May until August. The coldest month is July, with average temperatures of about 17°C , while January, the warmest month, sees temperatures typically close to 30°C.

Asunción presents a great climate because of its position in the region. It enjoys a Tropical Savannah Climate, which makes its temperatures stand between a cozy 18 C°, and 25 C°.

Summer going from late November to late March, this is the warmest station of the year. Temperatures and humidity tend to be high, and precipitations peak during this period.

Nature

Because of its biodiversity, Paraguay is an appealing destination for ecotourism.

13000 species of plants have been recorded in Paraguay, including many threatened species. Deforestation represents a significant threat to the biodiversity of Paraguay. The lapacho rosado is the national tree of Paraguay. 13000 species of animals have been recorded in Paraguay, including many threatened species. It is also a popular destination for birdwatching.

Iguazu

Paraguayan Residency

When you first apply for residency in Paraguay, you will receive a two-year temporary permit. Then, after those two years, you can apply for permanent residency.
Now residency is taken quickly without the need to open a bank account (now optional).

Steps to Get Paraguay Residency:

1. Determine eligibility: Check if you meet the requirements for residencies, such as being 18 years or older, having no criminal record, and having sufficient financial means to support yourself in Paraguay.
2. Choose a residency program: Paraguay offers several programs for obtaining residency, including investment, retirement, and work programs. Choose the one that best suits your needs and financial situation.
3. Gather required documents: You will need to provide several documents, such as a passport, birth certificate, police clearance certificate, and proof of financial means, to support your residency application.
4. Apply for residency: through a specialized and authorized professional.
5. Wait for approval: Once your application is submitted, you will need to wait for a decision on your residency. Processing times may vary.
6. Move to Paraguay: If your residency is approved, you can proceed to move to Paraguay. You will need to register with the local authorities and obtain a residency card.

Taxation

Paraguay stands out with its tax benefits.
Paraguay applies a 10% income tax on anything you earn inside Paraguay and a 0% income tax on anything you earn outside the country. So your foreign pension or any foreign income will be free of tax in Paraguay.

The V.A.T. standard rate is 10%. A 5% reduced tax rate applies to the supply of certain goods and services.

Paraguay taxes corporate income on a territorial basis. Resident entities are subject to tax on their income derived from Paraguay at a flat rate of 10%.

View of a residential neighborhood at Asuncion, Paraguay.