Paraguay Residency: Eligibility, Advantages, and Application Process

As per the updated immigration regime announced in 2022, foreign nationals can obtain temporary and permanent Paraguay residency through various government-regulated channels. Whether you wish to conduct business in Paraguay or relocate permanently, you can choose between several options.

To help you make informed decisions, this guide will cover:

• Temporary residence programs and requirements
• Permanent residency options 
• Taxation and financial considerations of becoming a Paraguayan resident
• Common residency application challenges

Temporary Paraguay Residency Options

Regardless of your relocation objectives, you will likely need to obtain a temporary residence permit in Paraguay. Besides enabling you to conduct specific business or investment activities, it may be the prerequisite for permanent residency.

Paraguay offers three types of temporary residency permits:

Type of Residency	Explanation
Spontaneous/Occasional Residency	A 90-day permit granted for short-term, specialized stays (athletes, performers in public shows, academics, or professionals on short projects, etc.). The permit can only be renewed once for another 90-day period
Temporary Residence	A two-year permit enabling foreigners to reside, invest, or perform business activities in Paraguay for two years. The permit can be obtained regardless of your income and without showing proof of funds. It automatically converts into permanent residency during the final three months
Residence for Retirees	You are eligible for this option only if your monthly retirement income is at least $1,300 per month. There is no age limit for retirement in Paraguay

You will most likely obtain the latter permit if you wish to temporarily work, invest, or otherwise participate in Paraguay’s economic activity. 

Paraguay Temporary Residency Requirements

Applications for Paraguay’s temporary residency are conducted in person, so you have two options:

1. Apply at the Paraguay embassy or consulate in your home country
2. Enter Paraguay on a tourist visa and submit your application and biometrics at the Dirección General de Migraciones (DGM) office

The necessary documentation will depend on the type of residency permit you wish to obtain, although the requirements remain fairly basic for both options. For the Spontaneous or Occasional Residency permit, you will need:

• A valid foreign ID document (e.g., passport)
• Consular visa (if applicable)
• Proof of legal entry into Paraguay
• A sworn declaration to the DGM outlining your profession, activity, or trade you will carry out in the country, and of the temporary local address 
• Proof of fee payment (892.016 PYG or approx. $126)

For the standard Temporary Residency permit, you will need the above documentation alongside some additional documents, most notably:

• Birth certificate
• Marriage certificate
• Police clearance certificate (from any country where you have lived in recent years)
• Interpol background check certificate

You must also pay a higher fee of 2,787,550 PYG (approx. $394). 

All foreign documents must be legalized or apostilled, and documents in a foreign language must be translated into Spanish by a licensed public translator.

Paraguay Permanent Residency Pathways

Paraguay grants permanent residency to four types of individuals:

1. Citizens of certain MERCOSUR member and associated states (Argentina, Brazil, Uruguay, Bolivia, Chile, Peru, Colombia, and Ecuador)
2. Family members of Paraguayan nationals
3. Foreign investors under the Unified Enterprise Registration System (SUACE) program
4. ​​Foreigners who have been a temporary resident for the last two years

Permanent Paraguay Residency for MERCOSUR Nationals

The process of becoming a permanent resident of Paraguay is relatively straightforward if you are a MERCOSUR national. You only need a temporary MERCOSUR residence permit, and you can apply for permanent residency within the final 90 days of its validity.

You can submit your application at the DGM office alongside a few standard documents, specifically:

• Temporary MERCOSUR residence permit
• Valid ID document
• Background check certificate
• Proof of financial solvency

The application fee is 223,004 PYG (approx. $33) per applicant, and you will pay it once you have submitted the application. Once approved, you will obtain a permanent residency card, which must be renewed every 10 years.

Permanent Residency for Family Members of Paraguayan Nationals

A Paraguayan individual’s spouse and minor children can obtain permanent residency without extensive application procedures. Here’s what the process entails for them:

1. Obtain a Repatriation Certificate from the Secretaría de Repatriados
2. Visit the Identification Department of the National Police to obtain your Paraguayan ID card
3. Apply for the permanent residency certificate at the DGM office

Minors must sign the residence application in the presence of both parents or legal guardians.

A notable benefit of applying for permanent residency as a family member of a Paraguayan national is that you do not pay the application fee if you present the Repatriation Certificate. Without it, you would pay a fee of 2,787,550 PYG (approx. $394).

You have 90 days from obtaining your ID card to apply for permanent residency. If the application is successful, you will get a renewable permanent residency card.

Paraguay Investment Visa and Residency (the SUACE program)

The SUACE program offers a direct path to permanent residency for foreign investors who establish a local business or invest in an existing one. To qualify, you must meet two conditions:

1. Investing at least $70,000 in a new or existing business
2. Creating at least five jobs

If you pursue this path to residency, you can enjoy an accelerated application. According to Paraguay’s immigration law, foreigners who demonstrate the applicable investment may bypass the temporary residency rule and apply for permanent residency directly.

SUACE applications are also processed within 10–15 business days, which is significantly shorter than the processing times for residency-by-investment programs in many other countries.

To submit the application, you need various documents, such as:

• Investor certificate
• Foreign ID document
• Birth certificate
• Police clearance certificate
• A sworn declaration pledging to make the investment

You can obtain the investor certificate at the SUACE Investor Department office. It is issued in the form of an official letter from the Ministry of Industry and Commerce, and it clarifies your investment.

After obtaining the certificate and gathering the necessary documentation, you can submit the SUACE application to the DGM. Once approved, you can obtain your residency card, which will be valid for 10 years and is renewable for subsequent 10-year periods.

The permanent residency application fee is the same as for the temporary residency (2,787,550 PYG). You will also need to pay a fee of 223,004 PYG (approx. $33) for a Certificate of Registration.

Foreigners Who Have Been Temporary Residents for the Last Two Years

Holding a temporary residence in Paraguay is considered one of the most straightforward paths to obtaining permanent residency. Pursuing permanent residency via this route requires meeting specific criteria, mainly:

• You must ensure that in the two years between obtaining your temporary and permanent residency, you have not been out of the country for more than 12 months at a time
• You must apply for permanent residency within 90 days before your temporary residency expires

The application process is similar to applying for a temporary residence card and involves:

• Collecting the required documents: The documentation you will need includes a passport, Paraguayan ID card, Paraguayan residence card, proof of financial solvency (this can include various documents, such as a bank statement with at least $5,000, a certificate of study, proof of employment in Paraguay, or an apostilled university degree), a good conduct certificate, a clean criminal record certificate, and a certificate of personal data issued by Interpol
• Submitting your application: Provide the required documentation and biometrics at the Dirección General de Migraciones (DGM) office
• Collecting your residence card: The waiting time is typically around 2–4 months
• Updating your Cédula (National ID card): You are required to update your ID card according to your new residential status. You can do so at the Department of Identifications of the National Police

How To Maintain Your Residency in Paraguay

Paraguay does not impose any excessive residency maintenance rules. You need to fulfill the standard requirements, such as:

• Renewing your residency card in a timely manner
• Conducting your business or investment activities legally
• Otherwise complying with Paraguayan law

While there are no minimum stay requirements, residents should not leave Paraguay for an extended period. Temporary residents may lose their status upon being absent for one year, while permanent residents should not leave Paraguay for more than three years without approval and a qualifying reason for absence. 

Is There a Paraguay Citizenship-by-Investment Program?

Paraguay does not offer a direct citizenship-by-investment program. The SUACE program is the closest alternative; therefore, you must be a permanent resident of Paraguay before applying for citizenship.

A person can apply for citizenship after three years of permanent residence. You must have spent at least 9 months in Paraguay every year for the last three years to qualify for citizenship.

You are required to apply for citizenship in person by submitting the relevant documentation to a Paraguayan judicial or immigration authority. The documents you will need include:

• Valid permanent residency card and Paraguayan ID
• Criminal record certificates from Paraguay and any other countries of residence
• Proof of residence and integration

Upon submitting the necessary documentation and paying a small fee (43,051 PYG or approx. $6), you will obtain a Naturalization Letter. You can then use the letter to obtain Paraguayan nationality and apply for a Paraguayan passport.

Note that naturalized citizens must maintain their Paraguayan nationality similarly to their resident status. Most notably, any unjustified absence of more than three years may be grounds for the revocation of your citizenship.

Tax Advantages and Considerations of Paraguay Residency

If you plan on conducting business in Paraguay or obtaining residency through the SUACE program, you should familiarize yourself with Paraguay’s unique taxation system. Specifically, you should focus on:

1. Tax residency requirements
2. Personal and corporate income tax rates
3. Double tax treaties

Tax Residency Requirements

Unlike many countries, Paraguay does not determine tax residency based on the number of days spent in the country. Due to the territorial taxation system, you must only pay taxes if you earn an income in Paraguay.

In this case, you must apply for a Registro Único de Contribuyentes (RUC) number, which is your tax identification number. Still, even a RUC does not make you a tax resident; you must formally apply for a tax certificate with the tax authority (Dirección Nacional de Ingresos Tributarios or DNIT).

Only after obtaining a tax certificate will you be considered a Paraguayan tax resident. There are no minimum days required for tax residency, which is important to know so that you can clear up a common misconception about the 120-day rule.

Namely, if you spend at least 120 days within a year in Paraguay, you can establish a legal domicile. This is done for administrative purposes and does not affect your tax residency.

Additionally, you can legally be a Paraguay resident without being a tax resident. If you do not earn any income in Paraguay, you are considered a “non-tax-paying individual.” Otherwise, you can leverage Paraguay’s tax-efficient environment.

Note that Paraguay does not impose a specific exit or emigration tax on individuals or corporations who decide to leave the country or cease to be tax residents. 

Personal and Corporate Income Tax Rates

Paraguay’s territorial taxation system means you only pay tax on income sourced in the country. All foreign income is tax-exempt, which can be highly beneficial for high-net-worth expats with cross-jurisdiction assets and income streams.

Paraguay-sourced income is taxed at progressive rates, as explained in the following table:

Annual Net Income	Personal Tax Rate
0–50,000,000 PYG (approx. $7,060)	8%
50,000,001–150,000,000 PYG (approx. $7,060–$21,180)	9%
Over 150,000,000 PYG	10%

Paraguay also does not implement a separate capital gains tax for the locally earned income. Instead, all capital gains are added to your annual income and taxed at your marginal rate.

Another appealing feature of the Paraguayan tax system is the lack of inheritance, gift, and wealth tax. This makes the country worth considering for expats focused on building and transferring generational wealth.

Double Tax Treaties

A potential disadvantage of being a Paraguayan tax resident is the country’s limited scope of double tax agreements. As of this writing, Paraguay only has a tax treaty with six countries:

1. Chile
2. Qatar
3. Spain
4. Taiwan
5. Uruguay
6. United Arab Emirates

If you are a tax resident of any other country with a Paraguayan income source, there is a theoretical possibility of double taxation. While Paraguay’s territorial taxation prevents this to an extent by not taxing foreign income, your home country may tax Paraguayan income.

The UK is a representative example. If you earn Paraguayan income while being considered a British tax resident, both Paraguay and the UK may tax your income. To ensure this does not happen, you would need to leverage the UK’s allowances, such as unilateral relief that grants credits for taxes paid abroad.

Despite such concessions, you must consider whether becoming a Paraguayan tax resident is financially sensible. It is best to consult a tax or financial expert to assess income exposure to cross-jurisdiction tax systems and identify any potential conflicts. 

Additional Benefits of Paraguayan Residency

Besides a tax-efficient environment, becoming a Paraguayan resident can provide various benefits, most notably:

• Economic integration: Once you have obtained a residence permit and a Paraguayan ID card, you can open bank accounts, register businesses, hold shares, and manage assets more easily within Paraguay’s legal framework
• Business opportunities: Paraguayan residency supports business and investment mobility by allowing you to leverage the country’s close economic relationships with MERCOSUR nations
• Freedom of travel: Obtaining a residency permit increases your flexibility to travel, conduct business, and invest across South America with fewer barriers
• Straightforward residency maintenance: Paraguay offers a flexible permanent residency regime. You maintain your residency status as long as you enter the country at least once every three years and renew your permit every 10 years. This offers flexibility for people who spend most of their time abroad

Common Challenges of Obtaining Paraguayan Residency

Although becoming a Paraguayan resident is relatively straightforward through all the available channels, you might encounter certain obstacles during the application process, most notably:

• Lack of remote applications: Since Paraguay does not have an online or fully remote application process, coordinating the potential travel requirements and obtaining the necessary documentation (e.g., travel permits or visas) may become overwhelming
• Investment verification: If you apply through the SUACE program, you must ensure consistency between the declared investment, actual funds, and business setup. Any mismatch could cause delays or even a rejection, so you must carefully approach investment planning and declaration
• Extensive due diligence: Paraguay requires comprehensive criminal and Interpol checks to process and approve applications. High-net-worth individuals with cross-jurisdictional residence, assets, and income streams may find it challenging to ensure there are no unreported issues that may hinder the application process
• Residency category switching: Permanent residency applications, besides those for SUACE, require switching from temporary residency, which must be done within a specific timeframe. Preparing the necessary documentation can be time-consuming, and any inefficiencies may result in missing the deadline

Fortunately, most of the residency application obstacles are procedural and logistical, so you can circumvent them with expert guidance. To streamline the application and ensure all conditions are met without guesswork, engage Nomad Capitalist for 360-degree support.

Obtain Paraguayan Residency Effortlessly With Nomad Capitalist

As a long-standing advisory firm, Nomad Capitalist has ensured the successful relocation of over 1,500 high-net-worth individuals and families globally. Our diverse team of experts has helped clients with all aspects of their expatriation, from residency and citizenship applications to long-term wealth management.

Our comprehensive guidance is structured into a step-by-step Action Plan. Each Plan is personalized and built on your unique circumstances to help you achieve your financial and lifestyle objectives.

To obtain your Action Plan, you only need to complete a quick questionnaire that determines whether we are a good fit. If so, our team will take it from there and complete the following steps:

1. Conduct a 45-minute onboarding call to collect all the details about your current situation and goals
2. Analyze your circumstances, identify obstacles, and devise the Action Plan accordingly
3. Present the Plan for your review and make any suggested modifications
4. Implement the Plan over 12 months, taking over all the administrative work on your behalf
5. Provide lifetime support after your expatriation, assisting with any changes and making necessary updates

With Nomad Capitalist, you get a team of legal, tax, and financial professionals who will advise you every step of the way throughout the relocation process. If you are ready to make impactful lifestyle changes, get your Action Plan today!