Paraguay’s Double Taxation Agreements: What They Do and Do Not Do

The treaty list, law by law

Each comprehensive agreement below was approved by a law published in the Biblioteca y Archivo del Congreso (BACN), and we took the signing dates from those laws. The entry-into-force dates come from the other country's government where it publishes them. Where it does not, the table says so.

Germany is often listed without qualification. The German Federal Ministry of Finance publishes a status list of every German tax agreement and every treaty negotiation. In the edition dated 1 January 2026, Paraguay appears once, as an air-transport agreement. Paraguay does not appear among comprehensive treaties or among negotiations in progress. So a German moving to Paraguay has no treaty that covers salary, pensions, dividends or gains.

Paraguay also has an agreement with Argentina limited to international air, river and land transport, approved by Ley N° 1105 of 1997. The United States does not list Paraguay among its income tax treaty partners (see US citizens). We have not found a UK–Paraguay treaty either (see UK leavers).

What double taxation agreements actually do

A double taxation agreement applies only to a person who is resident in one or both of the two countries. Category by category (employment, pensions, dividends, interest, gains, "other income"), it says whether the source country, the residence country or both may tax, and who gives relief.

That means it only helps where two countries are both claiming the same income. Paraguay's personal income tax applies only to income with a Paraguayan source, as explained in what the 0% covers. So for most people moving here there is no double taxation of foreign income to relieve, only a single claim from the country they left. The question is whether the treaty takes that claim away.

The tie-breaker, and why it comes second

The tie-breaker applies only if each country's own law treats you as its resident. Then the treaty picks one. The Spanish, Chilean, Uruguayan, Qatari and Emirati texts use the same sequence. The Taiwanese text is the same except that it has no nationality step and goes straight to mutual agreement:

1. Permanent home. You are resident where you have a permanent home available to you.
2. Centre of vital interests. If you have a permanent home in both countries, you are resident where your personal and economic relations are closer.
3. Habitual abode. If that cannot be decided, you are resident where you habitually live.
4. Nationality. If you live habitually in both countries or in neither, your nationality decides.
5. Mutual agreement. If none of these settles it, the two tax authorities decide between them.

Two points follow. First, the tests look at facts: a home, a family, a business, where you actually spend your days. A residence card decides none of them, and a home kept available in your old country weighs against you from the first step.

Second, you must pass the first step before the tie-breaker applies at all. Each country's own law has to treat you as resident. Paraguayan law is thin on that point for individuals: Article 5 of Ley N° 6380/2019 defines fiscal residence only for legal persons, as the 183-day rule page explains.

Three treaties with a catch

Spain: the territoriality clause

Article 26 of the Spanish treaty sets out limits on who can claim its benefits, including a principal purpose test. Paragraph 5 is aimed at territorial systems, and Paraguay's is one. It covers income that Articles 6 to 20 give exclusively to a country with a territorial system, but which that country does not treat as arising there. That income may be taxed in the other State as if the Convention had not entered into force.

Read that alongside Article 17. It says private pensions paid to a resident of one country may be taxed only in that country. On our reading of the text, suppose a former Spanish employee is a Paraguayan resident under the treaty and draws a Spanish private pension. Paraguay's territorial rule does not treat that pension as Paraguayan-source, so paragraph 5 appears to let Spain tax it anyway. Government-service pensions are a separate case: Article 18 generally leaves them with Spain. We do not advise on Spanish tax. Take this as a reason to get Spanish advice before you rely on the treaty, not as the answer.

United Arab Emirates: nationals only

Article 5 of the Emirati agreement defines an individual resident of the UAE as a person who is a UAE national under Emirati law. A foreign national living in Dubai does not meet that definition. So a Briton or German moving from Dubai to Asunción gets nothing from this treaty on the Emirati side. If Dubai is part of your plan, see Paraguay vs Dubai.

Uruguay: limitation on benefits

Article 27 of the Uruguayan treaty restricts its benefits to "qualified persons". An individual qualifies automatically. Companies must meet ownership, listing or active-business tests. The article also has a principal purpose test. A company set up to route income through Paraguay will be tested against both.

When there is no treaty with your home country

For most people reading this, there is no treaty, and that is the more common case. With no treaty, your home country applies its own law and nothing overrides it. That covers its residence tests, its rules on deemed or continued residence after departure, its exit tax on unrealised gains and its controlled foreign company rules. There is no tie-breaker to argue under and no mutual agreement procedure to call on. Those mechanisms are covered in what Paraguayan residency does not solve.

Where the tax residency certificate fits

The DNIT issues the Certificado de Residencia Fiscal under Resolución General N° 65/2020. The resolution was made so that Paraguayan residents could claim treaty benefits. The certificate is valid for one year from issue and states whether you were subject to Paraguayan tax rules for a stated period. For an individual, the application includes a record of your entries and exits from Migraciones. The process is set out in the tax residency certificate.

With a treaty partner, the certificate is the usual way to prove residence in Paraguay, for example to claim a reduced withholding rate at source. Without a treaty, it is still evidence of your status. It does not bind a foreign tax authority, and it does not resolve a dual-residence claim.

Information exchange: CRS status

Each of the six comprehensive treaties has an exchange-of-information article. Article 24 of the Spanish treaty expressly states that bank secrecy is no ground for refusing a request. Beyond the treaties, Paraguay's position on automatic exchange is as follows. Each point comes from an official OECD source:

• Paraguay signed the Convention on Mutual Administrative Assistance in Tax Matters on 29 May 2018 and ratified it on 15 July 2021. It has been in force for Paraguay since 1 November 2021, according to the OECD status list dated 1 September 2026.
• At the Global Forum plenary held in Asunción in November 2024, Paraguay announced that it would implement the automatic exchange of financial account information (the Common Reporting Standard) by 2027.
• Paraguay does not appear on the OECD's list of signatories to the CRS Multilateral Competent Authority Agreement dated 13 March 2025. That agreement is how exchanges under the Common Reporting Standard are switched on in practice.

So Paraguay has committed to automatic exchange and has set a date. As of the latest official lists we have read, it has not signed the operating agreement. Either way, your former country will receive data about accounts you keep in other participating jurisdictions. Separately, Resolución General N° 47/2026 created a crypto reporting duty (see crypto taxes).

What we would actually do

1. Check whether your home country is on the list. If it is not, drop the treaty from your plan and concentrate on leaving under your home country's own residence test.
2. If you are Spanish, read Article 26(5) before you read anything else, and take Spanish advice on your pensions and investment income before you move. That clause, not the tie-breaker, decides whether the treaty helps.
3. Make the facts match the treaty. The tests are permanent home, family, business, then where you actually live. Give up the old home, or be ready to explain why you kept it.
4. Get the certificate when there is a use for it, such as a treaty claim, a bank or a foreign authority asking for proof. It lasts a year and depends on your migration record.
5. Assume your accounts will be reported. Paraguay has committed to the Common Reporting Standard, and most countries where your money is likely to sit already exchange data.