Opening a Company in Paraguay in 2026
The country has no “SAS” — it has the EAS. And the 10% Paraguay hides a second tax most articles omit: the IDU. What that does to the final figure.
Much of the content about setting up a company in Paraguay uses the acronym “SAS” — the simplified joint-stock company, the established term in Colombia and, more recently, Brazil.
Paraguay has no SAS. The equivalent legal form, created by Law No. 6480/2020, is the EAS — Empresa por Acciones Simplificadas. The logic is the same (a single shareholder, individual or corporate, can incorporate the company), but the wrong name creates confusion in searches, in contracts and, occasionally, in documents that need to cite the law correctly.
That is the first of two things this article corrects. The second is more expensive: most promotional content talks about “10% tax in Paraguay” and stops there — ignoring a second tax that applies when profit leaves the company.
The three corporate vehicles
SUACE (the Unified Company Opening and Closing System), attached to the Ministry of Industry and Commerce, processes three main forms:
| Criterion | EAS (Law 6480/2020) | SRL | SA |
|---|---|---|---|
| Single shareholder permitted | Yes (individual or corporate) | No | No |
| Minimum capital | Not required | Required, with a payment-in deadline | Required |
| Incorporation timeline | Up to 72 working hours | Up to 15 working days | Up to 15 working days |
| Form of the constitutive act | Standard SUACE articles, private document with notarised signature, or public deed | Public deed | Public deed |
| Registry | Directorate-General of Legal Persons, Structures and Beneficial Owners (MEF) | Directorate-General of Public Registries | Directorate-General of Public Registries |
The single-shareholder EAS carries a specific restriction: it may not incorporate or hold an interest in another single-shareholder EAS — a cascading structure of one-person EAS entities is not permitted by law.
The point that stalls many foreign founders: the legal representative
Every EAS needs a legal representative, and access to the SUACE system requires electronic identity, obtainable only with a Paraguayan identity card. In practice, that means a foreign national without a Paraguayan identity card cannot file the incorporation request alone — they must appoint a legal representative who already holds Paraguayan electronic identity, by power of attorney. It is an operational detail that changes the timeline for anyone whose residency is not yet formalised, and one that few articles make explicit before people start the process.
The tax regime: IRE and the two simplified tiers
All Paraguayan-source business activity falls under Corporate Income Tax (IRE), created by Law 6380/2019 — which carved out of IRE the income already reached by personal income tax.
There are three tiers, by annual turnover:
| Regime | Annual turnover | Rate / basis of assessment |
|---|---|---|
| RESIMPLE | Up to PYG 80 million | 0.1% monthly on revenue, with no detailed accounting; no VAT |
| IRE SIMPLE | Up to PYG 2 billion | Simplified regime, with its own net income determination rules |
| IRE GENERAL | Above PYG 2 billion, or by election | 10% on net income, with full accounting |
The tax most articles omit: the IDU
Here is what separates a complete analysis from a marketing piece.
When profit is actually distributed — or deemed distributed, which includes specific scenarios such as shareholder loans or a cash shortfall exceeding 10% of the book balance — the Dividends and Profits Tax (IDU) applies, also under Law 6380/2019, withheld at source by the company itself:
- 8% where the recipient is resident in Paraguay.
- 15% where the recipient is non-resident — including where the beneficiary is the foreign parent of a Paraguayan branch.
Which means the effective burden on profit distributed to a non-resident shareholder, under IRE General, is not 10%. It is the combination of both taxes: 10% IRE on the company’s profit, plus 15% IDU on what remains when distributed — a combined burden close to 23.5% of the original profit, not the 10% frequently advertised. For someone remaining tax resident in Paraguay, the combination with the 8% IDU produces something close to 17.2%.
Note on scope: the calculation above is illustrative and does not replace a simulation using the investor’s actual corporate structure, applicable deductions and any qualification for incentive regimes (such as Law No. 7,548/2025, which exempts IDU under certain conditions — see below). Every structure should be modelled individually.
The link to the incentive regime
Companies whose investment project qualifies under Law No. 7,548/2025 — which entirely replaced the old Law 60/90 in September 2025 — can access IDU exemption for up to ten years where the investment reaches US$13 million or more, a benefit now available to foreign and domestic capital alike. We cover that change in detail in our article on tax residency and exemptions in Paraguay, which also addresses the territorial system applicable to individuals.
The other side of the border
For anyone structuring from another country, two points deserve attention before choosing the corporate form:
- Several jurisdictions in the region have recently tightened withholding on profits and dividends remitted abroad. In Brazil, for instance, Law No. 15,270/2025 introduced 10% withholding on profits and dividends remitted abroad, with no de minimis threshold, from 1 January 2026 — but that withholding applies on the home side, where relevant, and does not replace the Paraguayan IDU due on the distribution made by the Paraguayan company.
- Whether a double taxation treaty between Paraguay and the investor’s home country exists and is fully in force has to be verified case by case. Without a recognised treaty in force, a credit for IDU paid in Paraguay against home-country tax cannot be assumed.
Frequently asked questions
Does Paraguay have the SAS?
Not under that name. The equivalent form is the EAS (Empresa por Acciones Simplificadas), created by Law 6480/2020.
Is the corporate tax burden in Paraguay really 10%?
10% is the IRE rate on the company’s profit. When profit is distributed, IDU applies on top (8% for a resident, 15% for a non-resident), raising the total effective burden.
Can a foreign national without residency open an EAS on their own?
Access to SUACE requires electronic identity linked to a Paraguayan identity card. Without formalised residency, you need to appoint a legal representative holding a Paraguayan identity card, by power of attorney.
Is there a way to reduce or eliminate the IDU?
Projects qualifying under Law 7,548/2025, with investment from US$13 million, can access IDU exemption for up to ten years, on specific conditions.
How to verify for yourself
- Law No. 6480/2020 (EAS) — BACN, the National Congress Library and Central Archive.
- Law No. 6380/2019 (IRE and IDU) — National Directorate of Tax Revenue.
- SUACE — EAS incorporation requirements — suace.gov.py.
- Law No. 7,548/2025 — BACN.
If any figure in this article differs from the official source at the time you read it, the official source prevails — and we want to know.
The starting point
Opening a company in Paraguay is quick and, by regional standards, inexpensive. The part that requires planning is not the incorporation — it is understanding the combined tax burden on distributing the profit, and how that fits your objective: operating locally, exporting, or using the structure as the vehicle for a broader wealth plan.
One conversation is enough to know whether it makes sense to proceed.
Informational content. It does not constitute legal, tax, accounting or investment advice. The rules cited were verified against the official sources indicated in July 2026 and may be amended or further regulated. Individual situations produce different outcomes and should be analysed case by case.