📅 October 31, 2022

Paraguay Tax Residency Law Change: All You Need to Know [Update]

Authored by Danish Soomro

Taxation
Paraguay Tax Residency Law Change: All You Need to Know [Update]

Paraguay has long been attracting digital nomads, global entrepreneurs and expats from around the world due to their highly attractive 0% on foreign income tax system. This 2022, the Paraguayan authorities changed the law that describes the process to become a Permanent Resident, therefore affecting as well the procedure to get Tax Residency in Paraguay. 


You can find all you need to know about the Paraguay Tax Residency Law Changes. We will also soon be running a video session with our verified Expert for Paraguay, Natalia. 


How did the Paraguay Tax Residency Law change in 2022?

For many years, foreigners were able to obtain Paraguay Permanent Residency by either showing an apostilled and translated university degree or making a $5000 USD bank deposit in the country. In October 2022, four main things about this process changed:


  1. You now do not need to show any university degree or make any bank deposit to obtain Paraguay Residency.
  2. You now need to first obtain TEMPORARY RESIDENCY by paying the proper government fee, providing a clean criminal record and a birth certificate.
  3. After two years of being a temporary resident, you can apply for the PERMANENT RESIDENCY IN PARAGUAY. 
  4. Once a Temporary or Permanent Resident in Paraguay, the process to obtain a TAX ID is the same as before. However, they have paused the activities in the offices as for now. We will update as soon as this reopens.


Remember that you can also acquire Permanent Residency with an Investment. 



Has the 0% Tax on Foreign-Sourced Income in Paraguay changed?

Even though the process to obtain Permanent Residency was modified, which is the first step to get Tax Residency in Paraguay, the benefit of 0% tax on foreign-sourced income stays the same. You can still benefit from this program. 


Will I lose my current Paraguay Permanent Residency and Tax ID with the new law?

No, if you are already a Permanent Residency with an ID (Cédula) and Tax ID, you have nothing to worry about. 


Which documents do I need to apply for Paraguay Temporary Residency?

To apply for the Paraguay Temporary Residency, you need to following documents:

  1. Valid passport or ID document.
  2. If a consular visa is required, it will be verified by the Ministry of Foreign Affairs. 
  3. Proof of entry into the country.
  4. Birth certificate.
  5. Proof of marriage (if applicable).
  6. Current Criminal or Police Record Certificate at the National or Federal level of the country of origin or the country of residence in the last 3 (three) years, from the age of fourteen.
  7. Background certificate issued by Interpol, from the age of fourteen.
  8. Background Certificate for Foreigners, issued by the Computer Department of the National Police, from fourteen years of age.
  9. Sworn statement before the National Directorate of Migration of commitment to comply with and respect the National Constitution, the laws and other regulatory provisions that govern the national territory.
  10. Sworn statement before the National Directorate of Migration of your profession, activity or trade that you will carry out in the country and of the domicile established in the national territory.
  11. Payment of the fee corresponding to the corresponding subcategory. 


You need to apostille and translate to Spanish all the required documents to apply. 



Which documents do I need to extend my Paraguay Temporary Residency?

To extend your Paraguay Temporary Residency, you need the following documents. Remember that you need to translate and apostille them before applying: 

  1. Valid passport or ID document.
  2. Paraguay Temporary Residency Card. 
  3. Valid Paraguay Cédula (ID)
  4. Background Certificate, issued by the Identification Department of the National Police, from the age of fourteen.
  5. Background Certificate for Foreigners, issued by the Computer Department of the National Police, from the age of fourteen.
  6. Certificate of Judicial Background, from the age of fourteen.
  7. Background Certificate issued by Interpol, from the age of fourteen.
  8. Payment of the corresponding fee.


Can you assist in getting my Paraguay Tax Residency application?

Feel free to reach out to Natalia, our verified Expert for Paraguay, during the rest of 2022, she has more than 7 years of experience. You can read her reviews and process help below.



References:

Ley Nº 6984 / DE MIGRACIONES - Updated October 2022

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