Paraguay Residency: Everything You Need to Know
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Contents
- Benefits of Paraguay Residency
- Passport Related Benefits
- Drawbacks of Paraguay
- Getting Permanent Residency in Paraguay
- Permanent Residency Path #1
- Permanent Residency Path #2
- Permanent Residency Path #3
- Permanent Residency Path #4
- Key Documents Needed
- Getting Temporary Residency in Paraguay
- Other Residency Options
- Step-by-Step Guide to Obtaining Paraguay Residency
- How Long Does it Take to Get Your Residency?
- How to Convert Paraguay Residency into Citizenship
- Costs and Fees Associated with Paraguay Residency and Citizenship
- Frequently Asked Questions
- Ready to look at this further?
Paraguay wasn’t on too many people’s radars when I first entered this business in 2009. (Uruguay, Argentina, and Ecuador were more popular among my mostly American clients.) That’s no longer the case. Paraguay’s residency and citizenship options are much more well-known and increasingly popular.
I was reminded of this fact while working on a permanent residency renewal for a client of ours. That’s why I’m writing this up for you.
Could Paraguay be a part of your Plan B, or even a place to just spend some time? Have a look and see for yourself…
Benefits of Paraguay Residency
Paraguay is a landlocked country located in the center of South America and bordered by Bolivia, Brazil, and Argentina. It offers many benefits depending on what you’re looking for and why you’re looking for a second residency. Here’s a summary of the biggest ones:
Low Cost of Living
Paraguay boasts one of the most affordable costs of living in South America. US clients can often find a comparable, or better, lifestyle than what they get in the US for the same money. You can live comfortably in Asunción, the capital and largest city of Paraguay, on an income of $2,000 per month. Add a few hundred dollars more per month if you bring your spouse or partner with you.
Territorial Tax System
Paraguay uses a territorial tax system, meaning the government only taxes income generated within its borders. It does not generally tax foreign-sourced income of any sort.
Even then, Paraguay is a low-tax jurisdiction.
- Local income taxes cap at 10%.
- Corporate income tax is 10% of net profits.
- Dividends and interest earned from Paraguayan sources are taxed at a top rate of 8%.
- Capital gains on assets within Paraguay are also taxed at a top rate of 10%.
- Value Added Tax (VAT) ranges from 5-10%.
- There is no wealth or inheritance tax.
IMPORTANT NOTE FOR US CLIENTS
This is less of an advantage for US clients, who have to keep paying Uncle Sam no matter where they live. Still, there are some tax opportunities available in a territorial tax system like Paraguay. Get in touch to learn more.
It's easy to apply for Paraguay residency
The application process is straightforward and efficient if you work with a specialist firm. Investment thresholds are relatively low, and processing times are generally measured in weeks and months, not years.
Attractive Investment Opportunities in Paraguay
Paraguay offers some really interesting investment opportunities, including agriculture, real estate (especially farmland), and renewable energy.
Passport Related Benefits
Officially, Paraguay offers one of the fastest residency to citizenship qualifications in the world – just three years. (In practice, it’s more complicated than that, which we’ll cover later in this guide.)
Paraguay allows dual citizenship, and its passport offers visa-free and visa-on-arrival access to 148 countries. As a citizen, you also qualify for preferential access to opportunities within the MERCOSUR trade bloc. (MERCOSUR is a regional trade group established in 1991 with Argentina, Brazil, Paraguay, and Uruguay being the core members.)
Drawbacks of Paraguay
Expat Community Not as Well Developed
Paraguay’s expat community is smaller compared to neighboring Argentina, Brazil, or Uruguay. This means fewer expat-oriented services, social clubs, and support networks. Outside of tourist areas, a working knowledge of Spanish is important.
Far Away from the US
Paraguay has limited direct flights to and from the United States. Travel often requires connecting flights, and frankly, it just takes a long time to get there and back.
If you’re looking to move somewhere and need easy access back to the US for work or visits, it’s best to look elsewhere.
Infrastructure Often Not to Western Standards
Paraguay’s infrastructure still lags behind Western standards in some areas.
Roads may be poorly maintained, and public transportation doesn’t work as well (or at all) outside cities. Electricity and water supply can be sketchy. Internet speeds are slower; mobile coverage is limited in remote regions.
Healthcare facilities outside Asunción might not have the equipment for serious medical problems.
Getting Permanent Residency in Paraguay
The most popular track is to get permanent residency in Paraguay. That’s because it’s relatively low cost to get and there’s no law saying you need to actually spend any time in the country to keep it.
Unless you are disqualified for some reason (a criminal record will do it), you never need to qualify again. Instead, you will just have to review your cédula (ID card) once every ten years.
Here are the various paths to permanent residency.
Permanent Residency Path #1: Investor Track – Permanent Residency in as Little as 4 Weeks
This is the most popular option among our clients. In the past, $5,000 placed in a Paraguayan bank was enough to qualify. However, this option is no longer available. Instead, you must make a $70,000 investment in the country.
This program is known as the “Unified System for Opening and Closing Companies” in English or Sistema Unificado de Apertura y Cierre de Empresas in Spanish. Called SUACE for short. It allows you to register a business with the authorities to qualify for immediate permanent residency.
Basically, you will register a company using this system. You will then meet the minimum $70,000 using the investment track within the company (bank deposit, real estate etc.). During the process, you will get an Investor Certificate that can be used with your application.
We offer this service to our clients, of course.
Permanent Residency Path #2: Retirement Visa
A second path is the Permanent Residency for Retirees and Pensioners (Residencia Permanente para Jubilados y Pensionados).
The minimum monthly income requirement is only around $900 per month. The exact threshold fluctuates because it’s based on a multiple of the local minimum wage. Because the local currency has lost value against the US dollar in recent years, the minimum income threshold in US dollar terms has dropped substantially during that time.
You can bring your family as well, but the minimum income will be higher. (There’s some flexibility depending on certain factors like family makeup and where you plan to live.)
There are no minimum age requirements. Rather, the type of income is more important—it must be regular, stable, and expected to continue as long as you live. Common sources include:
- Government Pensions: Retirement benefits provided by a government entity.
- Social Security Benefits: Monthly payments from social security programs.
- Private Pensions: Retirement income from private pension schemes or employer-sponsored retirement plans.
- Military or Disability Pensions: Lifetime benefits received due to military service or disability.
Employment, business, investment, or freelance income are typically not accepted.
Permanent Residency Path #3: By Marriage
You can apply for permanent residency if you are legally married to a Paraguayan. That marriage must be recognized and registered according to Paraguayan law.
Processing typically takes several months. Once you have it, you gain the right to live and work in Paraguay indefinitely.
Permanent Residency Path #4: Through Your Child
Paraguay recognizes the concept of jus soli or “birthright citizenship.” That means that, if your child is born in Paraguay, they will be granted citizenship by birth. As the (foreign) parents, that will give you a claim to apply for permanent residency in Paraguay.
Processing times vary, but they generally take several months.
Key Documents Needed
Every type of application has slightly different requirements. But to give you an idea, here’s the list we provide to our clients who are going through the investor track (the most common path for us here.)
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Original copy of the Foreign Investor Certificate application form, which will be filled out by computer and signed once printed. This is provided through the SUACE system.
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Notarized copy of the identity document from your country of origin or passport.
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Notarized copy of the criminal record certificate from your country of origin, apostilled or legalized by the Ministry of Foreign Affairs of Paraguay. In the US, this is provided by the FBI.
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Notarized copy of the Interpol Certificate of Paraguay.
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Notarized copy of your entry stamp into Paraguay.
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Original copy of the Sworn Declaration of commitment to carry out the opening of the company through the SUACE system, accompanied by the signature certification sheet.
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Original copy of the investment project profile, signed by the investor.
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Current special power of attorney, granted by the holder, to the professional(s) with special power to represent and act on their behalf as necessary.
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Submit a supporting document that demonstrates your economic solvency.
Getting Temporary Residency in Paraguay
If you want to spend more time in Paraguay than your visa-free allowance requires (90 days for Americans), but you do not want the commitment of permanent residency, this is for you.
The biggest advantage is that they are fairly easy to get.
The biggest disadvantage is that they need to be renewed in person every year and can only be renewed once. That means that after two years, you will need to either leave or qualify for permanent residency.
For these reasons, it can make sense in certain circumstances. But for the vast majority of clients, if you want a second residency in Paraguay, it makes more sense to take the permanent route right away.
Other Residency Options
Above, we have highlighted the most common paths to residency that our clients use. However, there are others, including:
- Student: Starts as a temporary residency option and can be converted into permanent permission to live in the country.
- Research: Starts as temporary but, under certain conditions, can be converted into a permanent residence.
- Employment: It is a temporary residency that can be converted to permanent residency after two years.
- Mercosur: Citizens of Mercosur member countries enjoy a streamlined path to temporary residency, which can be converted to permanent residency after two years.
Step-by-Step Guide to Obtaining Paraguay Residency
Applying for residency in Paraguay involves several stages, from preparing your documents to interacting with local authorities.
Step One: Gather your documents
Every application has slightly different paperwork. You’ll need to prepare it according to the official instructions.
Step Two: Visit Paraguay
Application for residency requires one in-person visit. We recommend allowing at least a week to take care of the various appointments required to properly process your application with local authorities.
Step Three: Receive Your Residency Card
Depending on your permit type, your residency card (cédula) will be ready for pick up anywhere from a few weeks to a few months.
When it is, you have two options:
#1: You can pick it up yourself.
#2: You can engage a Paraguayan lawyer through a Power of Attorney to pick it up on your behalf and ship it to you.
(For convenience, most of our clients choose option #2.)
How Long Does it Take to Get Your Residency?
That’s a difficult question to answer but in general, investment applications are the fastest. Using the SUACE system, our clients are getting residency there in as little as four weeks.
Other applications take longer… usually measured in months.
The #1 Mistake
By far, the biggest mistake we see when it comes to residency and citizenship applications is not following the application instructions properly. This can lead to anything from delays to outright rejection.
Unless you have the time, language skills, and desire to navigate bureaucracy, it’s often much better to hire a professional firm like ours to manage the process on your behalf and serve as “checks and balances” to ensure your application is approved.
How to Convert Paraguay Residency into Citizenship
As mentioned above, Paraguayan citizenship is officially available after three years of (permanent) residency. But starting in roughly 2017-2018, immigration officials became concerned about people “passport shopping” and abusing the system.
Although residency itself has limited physical presence requirements, if you want to qualify for a Paraguayan passport, you should expect to spend most of your time in the country.
You’ll also need to show other strong connections, including:
- Residence: Owning or renting property and actually living in Paraguay.
- Economic Activity: Employment, business ownership, or active investments in the country.
- Social Integration: Participation in community events, local organizations, or volunteering.
- Language Proficiency: Demonstrable ability in Spanish or Guaraní (a widely spoken local native language).
Thanks to previous abuse of the system, even with strong connections, citizenship is not all that easy to get. In fact, our Paraguayan lawyer is not recommending starting a residency if the only goal is Paraguayan citizenship.
Costs and Fees Associated with Paraguay Residency and Citizenship
Generally, expenses can be categorized into four buckets: government fees, legal and consultancy fees, document preparation (apostilles, certifications, and translations), and travel. Below is a breakdown of these costs for permanent residency.
Government Fees
Depends on the type of application, but generally, it is less than $1,000.
Legal Fees
Again, it depends on the type of application, but anywhere from $2,000 to $5,000 is pretty typical.
Apostilles, Certifications, and Translations
Depending on how many documents need to be apostilled and translated, plan for anywhere from $500 to $1,000.
Travel Expenses
You’ll need to pay at least one visit to Paraguay, so factor in flights and hotels at a minimum.
Paraguay’s official currency is the Guaraní. However, the US dollar is accepted in various circumstances, especially in business catering to foreigners.
Frequently Asked Questions
Can I bring my family with me when applying for Paraguay residency?
Yes, you can bring your immediate family members, including spouses and dependent children.
What is the total cost to get Paraguay residency?
There are four types of fees involved in a Paraguay permanent residency application. Those are government fees, legal fees, various certification and apostille documents, and travel expenses. Excluding travel, you’re generally looking at $3,500 to $7,000 from start to finish.
Is learning Spanish mandatory?
While learning Spanish is not mandatory for residency, it’s still a good idea. Most official documents, communications, and daily interactions are conducted in Spanish. Outside of the cities, it’s the most common language (together with the native tongue Guaraní).
How long does the residency application process take?
The investor route – the most straightforward option – is usually turned around in about four weeks. Other residency options can take some months.
Are there any annual residency fees in Paraguay?
No, Paraguay does not impose annual residency fees for permanent residents. Permanent residency doesn’t expire. You will, however, need to renew your cédula (ID Card) every ten years. This renewal carries a fee with it.
What are the obligations for maintaining permanent residency in Paraguay?
In general, you need to keep your cédula up to date. While there’s no strict physical presence requirement, it’s a good idea to keep some ties to the country (you will be asked when you renew your cédula). It goes without saying that you should keep a clean criminal record.
If you do not follow these requirements, your permanent residence may be revoked.
Ready to look at this further?
Should Paraguay be a part of your international plan? Only you can answer that. However, for 40+ years, we have helped thousands of customers and clients decide to build plans that include residency and citizenship opportunities.
Based on your specific goals, we design a plan around your needs, and then help you put it all into action. To see if we’re the right fit for you, feel free to book a free, no obligation consultation with one of our Associates. You can do so here.
About The Author
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We have 40+ years experience helping Americans move, live and invest internationally…
Need Help?
We have 40+ years experience helping Americans move, live and invest internationally…
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