Methodology - Paraguay (2026)

Educational model - not a DNIT/SET assessment, not a tax return, not tax advice.

Employee (relacion de dependencia)

IRP on rentas del trabajo (Ley 6380/2019, art. 70) is an annual progressive tax on the renta neta, marginal by tranche: 8% up to PYG 50,000,000, 9% on PYG 50,000,000 - 150,000,000 and 10% above PYG 150,000,000.
Non-incidence threshold (minimo no incidido, Ley 6380 art. 62): no IRP is owed unless annual gross personal-services income exceeds PYG 80,000,000. Many salaried workers below this pay 0 IRP.
The renta neta in this model is the annual gross minus the employee IPS contribution. Documented personal/family expenses (food, housing, health, education) are also deductible and would lower the tax further, but are out of scope.
IPS (Instituto de Prevision Social): employee aporte obrero 9% of gross; employer aporte patronal 16.5% (14% IPS + 2.5% SENEPA/SNPP/SINAFOCAL).
Out of scope: the transitional first-year threshold rule, the aguinaldo / 13th salary (IRP- and IPS-exempt up to the legal limit), capital-income IRP (a separate flat 8% category), and non-resident specifics.

IRP on the renta neta (net profit = revenue minus documented deductible business expenses), using the same annual progressive scale as employment (8% up to PYG 50,000,000, 9% on PYG 50,000,000 - 150,000,000, 10% above), marginal by tranche.
Non-incidence threshold (Ley 6380 art. 62): no IRP unless annual gross income (revenue) exceeds PYG 80,000,000.
IPS for independent workers is voluntary: charged only when included, at a provisional 13% of a base defaulting to the net profit and floored at the minimum-wage annual base. When paid it is deductible to reach the renta neta.
Out of scope: VAT (IVA), the IRP empresarial (IRE) for those operating as a company, personal/family expense deductions beyond business egresos, the transitional first-year threshold rule, and partial-year activity.