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Taxation in Guatemala

Corporate Tax

Main rate: 31% of net income

Guatemala operates a territorial system where income tax is levied only on Guatemalan-source income. Resident companies may opt to be taxed under one of two regimes: the general regime, where a flat 5% tax is imposed on gross income of each month; or the optional regime, where tax is levied at a rate of 31% on net taxable income. An asset tax is also imposed, amounting to 2.5% of the income or net assets of the previous year. The asset tax may be credited against corporate income tax liability.

Personal Tax

Progressive rates to 31%

Resident individuals are subject to income tax at progressive rates ranging from 15% to 31% on their Guatemalan-source income. Non-resident individuals are taxed via withholding at a flat rate of 31% on their Guatemalan-source income. Employment and professional services income is taxed at progressive rates ranging from 10% to 31%, generally via withholding at source. Other income is taxed at a flat rate of 31%.

Capital Gains

Gains are taxable

Capital gains are taxed at 10% under the general regime and 31% under the optional regime.

Indirect Tax

Standard rate: 12%

Value-added tax (VAT) applies at a 12% standard rate to most transactions. Exemptions include basic foodstuffs, certain financial services and sales of some low-cost housing. Exports are zero-rated, and exporters may obtain a refund of 60% (or 75% for smaller amounts) of input tax paid. A simplified regime applies for small taxpayers.

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