Guatemala
Tax Guide: Guatemala
Population: 17,357,000 (approximately)
Currency: Quetzal (Q.)
Principal Business Entities:
Last modified: 03/09/2024 08:26
Corporate taxation
| Rate | |
|---|---|
| Corporate income tax rate | 25% |
| Capital gains tax rate | 10% |
Taxpayers who register in the Optional Simplified Regime for Income from Lucrative Activities must determine their taxable base by deducting the exempt income from their gross income.
| Resident income | |||||
|---|---|---|---|---|---|
| In general, all income generated within the national territory, whether or not there is a permanent establishment from which this activity is carried out in whole or in part. | |||||
| Category | Rating | Description | Taxes | ||
| Income from lucrative activities | Profit-making regime | Taxpayers who register in the Profit Regime for Lucrative Activities must determine their taxable base, deducting from their gross income the exempt income and the deductible costs and expenses in accordance with this Law and must add the costs and expenses for the generation of exempt income. | 25% | ||
| Income from lucrative activities | Simplified Optional Regime on Income from Profit < | Monthly taxable income range | Fixed amount | tax rate of | |
| Q.0.01 to Q.30,000.00 | Q.0.00 | 5% of taxable income | |||
| Q.30,000.01 onwards | Q.1,500.00 | 7% of the excess of Q.30,000.00 | |||
| Earned income | Labor income | In general, those from all types of considerations, remunerations or income, whatever their denomination or nature, derived from the personal work provided by a resident in a relationship of dependency, carried out inside or outside Guatemala. | Taxable income range | Fixed amount | tax rate of |
| Q.0.01 to Q 300,000.00 | Q.0.00 | 5% of taxable income. | |||
| Q.300,000.01 onwards | Q.15,000.00 | 7% on the excess of Q.300,000.00. | |||
| Capital Income | Capital Income | The generation in Guatemala of capital income and capital gains and losses, in cash or in kind, that come from patrimonial elements, goods or rights, whose ownership corresponds to the resident or non-resident taxpayer, constitutes an event generating Income Tax. the country. | 10% | Income from movable and real estate capital. Capital gains | |
| 10% | Lotteries, raffles, bingos, raffles or similar | ||||
| 5% | Distribution of dividends, profits and profits, regardless of denomination or accounting | ||||
Residence: The legal persons, entities or assets specified in this book, which comply with any of the following situations: a) That have been incorporated in accordance with the laws of Guatemala. b) That they have their registered office or tax domicile in national territory. c) That they have their headquarters of effective management in national territory. For these purposes, it is understood that a legal person, entity or patrimony specified in this book, has its seat of effective administration in national territory, when the direction and control of all its activities is exercised there.
Basis: Guatemalan-source income. They are income from Guatemalan sources, regardless of whether they are taxed or exempt, under any category of income INCOME FROM LUCRATIVE ACTIVITIES with 2 regimes CAPITAL INCOME AND CAPITAL GAINS
Taxable income: 1. Regime on profits from lucrative activities. Taxpayers who register in the Income Tax Regime for lucrative activities must determine their taxable income, deducting from their income the exempt income and the deductible costs and expenses in accordance with this Law, and must add the costs and expenses for the generation of exempt income. 2. Simplified Optional Regime for Income from Lucrative Activities Taxpayers who register in the Simplified Optional Regime for Income from Lucrative Activities must determine their taxable income by deducting exempt income from their gross income.
Significant local taxes on income: Distribution of dividends, profits and profits, regardless of denomination or accounting. 5%
Alternative minimum tax: Payment of this tax is made by individuals or companies, affiliated with the Income Tax Regime, who have their own assets, carry out commercial and agricultural activities and obtain a gross margin of more than four percent (4%) of their gross income. It is regulated by Decree 73-2008. Payment is made quarterly.
Taxation of dividends: Distribution of dividends, profits and profits, regardless of denomination or accounting 5%
Capital gains: The generation in Guatemala of capital income and capital gains and losses, in money or in kind, that come from patrimonial elements, assets or rights, whose ownership corresponds to the resident or non-resident taxpayer, constitutes an event that generates Income Tax. the country. 10% Movable and real estate capital income. Capital gains 10% Lotteries, raffles, bingos, raffles or similar 5% Distribution of dividends, profits and profits, regardless of denomination or accounting
Losses: N/A
Foreign tax relief: N/A
Participation exemption: N/A
Holding-company regime: N/A
Tax-based incentives: Tax incentives.
Group relief/fiscal unity: N/A
Small company/alternative tax regimes: Small Taxpayer Regime. Individuals or legal entities whose amount of sale of goods or provision of services does not exceed one hundred fifty thousand Quetzals (Q.150,000.00) in a calendar year, may request their registration to the Small Taxpayer Regime. The rate applicable in the Small Taxpayer Regime will be five percent (5%) on the total gross receipts from sales or provision of services obtained by the Taxpayer registered in this regime, in each calendar month.
Corporate taxation: compliance
Tax year: From January 1st to December 31st
Filing and payment: It is presented in the banks of the system and filled out on the Tax Administration’s website Declaraguate. On March 31 of each year, they must present the annual declaration that includes from January to December of the immediately previous year.
Penalties: The failure to pay taxes will be sanctioned with a fine equivalent to one hundred percent (100%) of the amount of the omitted tax, for the lack of determination or the incorrect determination presented by the taxpayer, detected by the audit action. Compensatory interest in favor of the Treasury. The taxpayer or responsible party who does not pay the amount of the tax obligation, within the established legal periods, must pay compensatory interest, to compensate the treasury for the non-availability of the amount of the tax at the due time
Rulings: The penalties are contemplated in Law No-6-91 “Tax Code”
Taxation of individuals
| Taxable income range | Fixed amount | Tax rate of |
|---|---|---|
| Q.0.01 to Q 300,000.00 | Q.0.00 | 5% on taxable income. |
| Q.300,000.01 onwards | Q.15,000.00 | 7% on the surplus of Q.300,000.00. |
Residence: a) Persons of Guatemalan nationality who have their habitual residence abroad, by virtue of being members of Guatemalan diplomatic missions or consular offices, holders of official position or employment of the Guatemalan State and active officials who exercise position or employment abroad official that does not have a diplomatic or consular character. b) People of Guatemalan nationality who have their habitual residence abroad, by virtue of being officials or employees of private entities for less than one hundred eighty-three (183) days during the calendar year, understood as the period between the January one (1) to December thirty-first (31). c) People of foreign nationality who have their residence in Guatemala, who carry out their work in a dependency relationship in diplomatic missions, consular offices or in the case of official positions of foreign governments, when there is no reciprocity.
Basis: Obtaining any remuneration or income in money, whatever its denomination or nature, which comes from the personal work provided in a relationship of dependency, by individuals resident in the country
Taxable income: Taxable income is determined by deducting from income net deductions allowed by law
Capital gains: The generation in Guatemala of capital income and capital gains and losses, in money or in kind, that come from patrimonial elements, assets or rights, whose ownership corresponds to the resident or non-resident taxpayer, constitutes an event that generates Income Tax. the country. 10% Movable and real estate capital income capital gains 10% Lotteries, raffles, bingos, raffles or similar 5% Distribution of dividends, profits and profits, regardless of denomination or accounting
Deductions and allowances: For purposes of the ISR, indicated above, in terms of work income, those indicated in Law Q48,000.00 are deductible for personal expenses without the need for verification, personal deductions up to a maximum of Q12,000.00 supported by invoices authorized by the tax authority, donations made, value of quotas for contributions to social security and other social welfare plans, value of life insurance premiums to cover risks in cause of death exclusively for the worker.
Foreign tax relief: N/A
Taxation of individuals: compliance
Tax year: From January 1st to December 31st
Filing and payment: It is presented in the banks of the system and filled out on the Tax Administration’s website Declaraguate. On March 31 of each year, they must present the annual declaration that includes from January to December of the immediately previous year.
Penalties: The failure to pay taxes will be sanctioned with a fine equivalent to one hundred percent (100%) of the amount of the omitted tax, for the lack of determination or the incorrect determination presented by the taxpayer, detected by the audit action. Compensatory interest in favor of the Treasury. The taxpayer or responsible party who does not pay the amount of the tax obligation, within the established legal periods, must pay compensatory interest, to compensate the treasury for the non-availability of the amount of the tax at the due time . The penalties are contemplated in Law No-6-91 “Tax Code”
Withholding taxes
| Description | ||
|---|---|---|
| Tax | ||
| 1 | International cargo and passenger transport activities | 5% |
| 2 | Insurance premiums, bond premiums, reinsurance, retrocessions, and reguarantees, obtained by non-residents. | 5% |
| 3 | Telephone, data transmission and international communications of any nature and by any means, from the communications service of any nature between Guatemala and other countries. In all cases, regardless of the place of incorporation or domicile of the companies that provide the service. | 5% |
| 4 | Dividends, distribution of profits, gains and other benefits, as well as any transfer or account credit to their parent companies abroad, without consideration made by permanent establishments of non-resident entities. | 5% |
| 5 | The interests, in the terms of article 4 of this book, paid or credited to non-residents. | 10% |
| 6 | Wages and salaries, per diems, commissions, bonuses and other remunerations that do not imply reimbursement of expenses. | 15% |
| 7 | Payments or bank account accreditation to athletes and theater, television and other public or acting shows. | 15% |
| 8 | Royalties: | 15% |
| I. Copyright and related rights, on literary, artistic or scientific works, including cinematographic films, videotapes, radio soap operas, phonograph records, musical and audio recordings, comic strips, photo novels and any other similar means of projection, transmission or dissemination of images or sounds, including those from cable or satellite television transmissions and multimedia. | ||
| II. Trademarks, expressions or advertising signs, trade names, emblems, geographical indications and appellations of origin, patents, industrial designs, drawings or utility models, plans, supplies of formulas or secret procedures, privileges or franchises. | ||
| III. Rights or licenses on computer programs or their updating. | ||
| IV. Information related to industrial, commercial or scientific knowledge or experience. | ||
| V. Personal rights subject to transfer, such as image rights, names, nicknames and artistic names. | ||
| SAW. Rights over other intangible assets. | ||
| 9 | Fee | 15% |
| 10 | Scientific, economic, technical or financial advice. | 15% |
| 11 | Other taxable income not specified in the previous numerals | 25% |
Branch remittance tax: N/A
Anti-avoidance legislation
Interest restriction: Interest restriction
Controlled foreign companies: Controlling Entities
Hybrid mismatches: n/a
Disclosure requirements: Rebellions to be carried out
Exit taxes: Departure taxes
General anti-avoidance rule: rules against tax avoidance
Digital services tax and Other significant anti-avoidance legislation: Digital services and methods to stop elution
Value-added tax/Goods and services tax
Type of tax: It is the tax that generates the most money for the State, it is paid by every person who buys some good or acquires a service. It is regulated by Decree 27-92. The VAT rate is 12% of the value of each product or service and is always included in the prices of everything we buy. Taxpayers registered in the General Regime are required to report monthly the VAT paid on their purchases and the VAT collected on their sales.
Standard rate: 12%
Reduced rates: The rate applicable in the Small Taxpayer Regime will be five percent (5%) on the total gross receipts from sales or provision of services obtained by the Taxpayer registered in this regime, in each calendar month
Registration: Taxpayers subject to this tax who are required to keep accounts in accordance with the Commercial Code, must open and maintain special accounts to record the taxes charged on the sales they make and services they provide, which will be their tax debts and those borne on the invoices received from their suppliers and service providers, which will constitute their tax credits.
Filing and payment: Taxpayers must submit, within the calendar month following the expiration of each tax period, a declaration of the total amount of the operations carried out in the previous calendar month, including those exempt from the tax, and record in the same form the other data indicated in the regulations using the forms provided by the Directorate at the cost of printing. Together with the filing of the return, the payment of the resulting tax will be made.
Social security contributions
| Description | ||||
|---|---|---|---|---|
| Quota Percentage for Active Workers | ||||
| Workers Contribution | Employers Contribution | Total | ||
| EMA: Illness, Maternity and Accidents | 3.00% | 7.00% | 10.00% | |
| IVS: Disability, Old Age and Survival | 1.83% | 3.67% | 5.50% | |
| INTECAP | 1.00% | 1.00% | ||
| IRTRA | 1.00% | 1.00% | ||
| Total | 4.83% | 12.67% | 17.50% | |
Self-employed
N/A
Other taxes
Capital duty: The increase in registered capital of companies are not subject to taxation. Only the transfer of shares as capital gains are taxed.
Immovable property taxes: Known as IUSI, it is the contribution that Guatemalans who own property, real estate, rural or rural and urban provide to the State. Most of what is collected is assigned to the municipalities, the majority already collects and administers it, others through the Directorate of Cadastre and Appraisal of Real Estate of the Ministry of Finance. It is regulated by Decree 15-98. Payment is made quarterly or annually.
Transfer tax: Transfer tax: Transfer tax is contemplated within capital gains tax. The rate might be 5% for Distribution of dividends, profits and profits, regardless of denomination or accounting
Stamp duty: The tax rate is three percent (3%). The tax is determined by applying the rate to the value of the acts and contracts affected. The value is that stated in the document, which may not be less than that stated in the public registries, registrations, cadastre or official lists.
Net wealth/worth tax: N/A
Inheritance/gift taxes: The payment is made by the beneficiaries of inheritances, legacies and donations. It is regulated by Decree 431.
Other: Tax on the Distribution of Crude Oil and Fuels Derived from Petroleum:It arises at the time of dispatch of crude oil and fuels. The proceeds are assigned to the municipalities, for the transportation service, to improve and build and maintain the road infrastructure, both urban and rural. It is regulated by Decree 38-92 The tax rates are as follows: Gasoline higher than Q.4.70; Regular Gasoline Q4.60; Aviation Gasoline Q4.70; Diesel and gas oil Q1.30; Kerosene Q0.50; Kerosene for jet engines Q0.50; Naphtha Q0.50; Liquefied petroleum gas (propane gas, butane, methane and similar) in bulk and in carburization Q0.50 Tax on the Distribution of Distilled Alcoholic Beverages, Beers and other Fermented Beverages:The beverages that pay this tax are Beers and other fermented cereal beverages, Wines, sparkling wines, wines, vermouth and ciders, distilled alcoholic beverages, mixed alcoholic beverages, and other fermented beverages. It is regulated by Decree 21-2004. The tax base is the sale price to the final consumer, suggested by the manufacturer or importer. Tax on Tobacco and its products:It governs everything related to the planting, cultivation, transit, manufacturing, trade, consumption, import and export of tobacco and its products, in addition to setting a tax for domestic and imported machine-made cigarettes, as well as cigars and mixtures. . The amount of the tax collected is used to finance the budget of the health sector. It is regulated by Decree 61-77. It must be paid by manufacturers and importers. Cement Distribution Tax:The distribution of cement in the national territory, must be paid by the manufacturers and importers of this product, is generated at the time the product leaves the storage warehouses of the manufacturers or when it enters the country. It is regulated by Decree 79-2000. The rate of this tax is Q1.50 for each bag weighing 42.5 kilograms or its equivalent, when sold in bulk or in bags of different weights.
Tax treaties
– No Double Taxtion Treaties – Agreement on Exchange of Information in tax matters