Residency Program in Paraguay: How It Works in 2026

Paraguay stands out as one of the easiest and most convenient countries to obtain a second residency. Its favorable tax system makes it a popular destination for those seeking a secondary residency, not only for themselves but also for their business. The laws governing the residency process in Paraguay have undergone significant changes, especially in 2020 and again in 2022, introducing several updates regarding prerequisites and steps to obtain residency.

Over the years, our team has helped more than 750 people from around the world take advantage of Paraguay's residency program. In this guide, we will review all available options and their requirements. If you are looking for a personalized consultation, we also remind you that you can contact us and receive specialized assistance.

Temporary and Permanent Residency

The first thing you should know about Paraguay's residency program is that there are two main options:

• Temporary residency is valid for 2 years, with the possibility of renewal and conversion to permanent residency.
• Permanent residency grants indefinite residency in the country and requires renewal every 10 years.

Both statuses allow lawful residence in Paraguay, but they are not identical for every legal and tax purpose. Temporary residence is usually the first step; permanent residence may be relevant for additional tax and long-term status considerations. Currently, the most straightforward and cost-effective route is to first obtain temporary residency and then convert it to permanent residency.

Temporary Residency

Anyone without ongoing criminal charges can obtain temporary residency. It is a popular way to begin the residency process in Paraguay, as it does not require making investments or demonstrating a certain income level. All you need are some documents to start the process.

The process varies slightly for citizens of MERCOSUR countries compared to other countries. However, in general, the procedure always unfolds in three stages:

1. 1Before arriving in Paraguay, you must prepare the necessary documents and have them apostilled. For most foreign citizens, the required documents are a criminal background certificate, birth certificate, and a valid passport.
2. 2Upon arriving in the country, you must visit a series of offices (Police, Interpol, IT Department, Ministry of Foreign Affairs, and Immigration Department) to obtain the temporary residency card. This document typically takes between 95 and 105 days to be issued in 2026. When working with a specialized agency, you may be able to reduce this time to 35-45 days.
3. 3After the temporary residency card, you can go to the Paraguayan Police Identification Department to obtain the ID card (cedula). As of September 2024, it has become strictly necessary to apply for the new ID card format. This is the format that incorporates the microchip and can only be obtained through electronic fingerprints and digital signature.

At this point, you may access various benefits such as applying for a driver's license, establishing a business, or purchasing property. Bank-account opening is facilitated but always depends on each bank's KYC review. Depending on your specific circumstances, you may also become subject to Paraguayan taxes.

Permanent Residency

Permanent residency grants the right to reside indefinitely in Paraguay, with the provision of renewing it every 10 years.

There are two routes to obtain permanent residency:

1. 1The simplest method is to first obtain temporary residency and then convert it to permanent. You are allowed to switch your temporary residency to permanent after 21 months. In this case, you will need to show very basic proof of solvency.
2. 2Alternatively, you can directly obtain permanent residency through the SUACE investor route. Under the current public SUACE criteria, this requires a qualifying project, documentary support of economic capacity, a minimum planned investment of USD 70,000, at least 5 direct hires, and execution within up to 24 months.

Some of the benefits of obtaining permanent residency through investment include:

• We assist with bank-account opening, but final approval depends on each bank's compliance and KYC review
• Typically faster processing of the residency card and ID card (timelines vary by authority workload)
• Permanent residence may support later eligibility to apply for naturalization, subject to constitutional and judicial requirements (including a minimum of 3 years of permanent residency, among other criteria)

Minimum Stay Requirements

One of the key advantages of Paraguay's residency program is that it does not require you to physically live in the country to maintain your residency status. The only requirements are:

• Avoid making an unjustified absence from the country of 12 consecutive months during temporary residency.
• Avoid making an unjustified absence from the country of 36 consecutive months during permanent residency.

As of early 2026, there is talk of changing the law and officially eliminating the mandatory visit requirement. That said, until the law is officially amended, we recommend that our clients continue to comply with mandatory visits. A visit can theoretically be just one minute, as there is no requirement to stay for a specific period of time each time you visit the country.

What Are the Benefits of Paraguay's Residency Program?

Paraguay offers a unique set of advantages, especially for those seeking an attractive tax system and a fast-growing economy. Among the reasons that drive thousands to relocate their residency here each year are:

• Corporate taxation depends on the applicable regime. IRE General and SIMPLE are generally 10% on net profits; RESIMPLE follows a simplified quota system based on revenue brackets.
• Under the territorial tax system, income generated abroad by companies or individuals is currently not subject to Paraguayan taxation.
• Capital gains on Paraguayan-source assets are generally taxed at 8% for individuals. Gains on non-Paraguayan assets are generally outside Paraguayan tax scope, subject to source rules. The tax treatment of crypto assets should be analyzed case by case depending on the taxpayer, the operation, and the applicable Paraguayan-source rules.
• Banking confidentiality protections under current regulations.
• Paraguay does not use a standard annual-day test, but migration residence can be lost after unjustified absences (12 months for temporary, 36 for permanent). Tax residency is a separate concept.
• Laws are especially favorable for entrepreneurs and investors, even more so for those bringing foreign capital.
• The nation is not blacklisted and allows unrestricted movement of capital.
• The criteria and costs for obtaining and maintaining residency are among the most competitive in the world.
• The Guarani is the oldest currency in Latin America, maintaining an average inflation rate of less than 3% over the last 50 years.
• For those considering opening a manufacturing business, Paraguay's low labor and energy costs make it an attractive proposition.