Countries › Guatemala › Guide › 6. Taxes › Guatemala tax system overview: territorial income tax, 25 percent or 5 and 7 percent business regimes, 5 percent dividend tax, nonresident withholding, 12 percent VAT, solidarity tax, stamp tax and the four year audit window

Guatemala tax system overview: territorial income tax, 25 percent or 5 and 7 percent business regimes, 5 percent dividend tax, nonresident withholding, 12 percent VAT, solidarity tax, stamp tax and the four year audit window

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Last verified: 2026-10-28 · Status: Changing

Guatemala taxes only income earned in its territory, so a resident company pays no Guatemalan income tax on foreign source income; business income is taxed either at 25 percent of net profit, with quarterly advances and an annual return due by 31 March, or at 5 percent of monthly gross revenue up to Q30,000 and 7 percent above it. Dividends carry a flat 5 percent tax, other capital income and capital gains 10 percent, and payments to nonresidents a final withholding of 5, 10, 15 or 25 percent depending on the payment, while sales of goods, services and imports bear a 12 percent VAT filed monthly. Companies under the profit regime with a gross margin above 4 percent also pay a 1 percent quarterly solidarity tax that can be credited against income tax, documents and contracts outside the VAT net bear a 3 percent stamp tax, and SAT has four years to audit; employee income tax changes on 1 January 2027 under Decreto 13-2026.

USD figures use Q7.64427 per US dollar, the Banco de Guatemala reference rate for 28 October 2026, retrieved from the Banguat exchange rate web service on the verification date. Taxes are paid in quetzales, and foreign currency amounts are converted at the Banguat reference rate. Conversions are for orientation only.

Key facts

Income tax basis	Territorial: only Guatemalan source income is taxed textDecreto 10-2012 art. 1 and 3, as of 2026-10-28 · in force
Corporate income tax rate, profit regime	25 %Decreto 10-2012 art. 36, as of 2026-10-28 · in force
Optional simplified regime on gross revenue	5% of monthly taxable revenue up to Q30,000; Q1,500 plus 7% above textDecreto 10-2012 art. 44, as of 2026-10-28 · in force
Presumed profit for quarterly advance payments (option 2)	8 % of quarterly gross incomeDecreto 10-2012 art. 38, as of 2026-10-28 · in force
Annual income tax return deadline	Within the first three months of the year (31 March) textDecreto 10-2012 art. 39, as of 2026-10-28 · in force
Tax on dividend and profit distributions	5 %Decreto 10-2012 art. 93, as of 2026-10-28 · in force
Withholding on dividends and branch remittances to nonresidents	5 %Decreto 10-2012 art. 104 num. 1 lit. e, as of 2026-10-28 · in force
Withholding on interest paid to nonresidents	10 %Decreto 10-2012 art. 104 num. 2, as of 2026-10-28 · in force
Withholding on royalties paid to nonresidents	15 %Decreto 10-2012 art. 104 num. 3, as of 2026-10-28 · in force
Withholding on fees and technical, economic or financial advice paid to nonresidents	15 %Decreto 10-2012 art. 104 num. 3, as of 2026-10-28 · in force
Withholding on other taxable income of nonresidents	25 %Decreto 10-2012 art. 104 num. 4, as of 2026-10-28 · in force
Capital income and capital gains rate	10 %Decreto 10-2012 art. 92, as of 2026-10-28 · in force
Interest deduction cap	Allowed rate times 3 times average total net assets textDecreto 10-2012 art. 24, as of 2026-10-28 · in force
Employee income tax rates	5% up to Q300,000; Q15,000 plus 7% above textDecreto 10-2012 art. 73, as of 2026-10-28 · in force
Top employee income tax rate	7 %Decreto 10-2012 art. 73, as of 2026-10-28 · in force
Extraordinary employee deduction for 2026	3024 GTQDecreto 13-2026 art. 4, as of 2026-10-28 · in force
VAT standard rate	12 %Decreto 27-92 art. 10 (Decreto 32-2001), as of 2026-10-28 · in force
VAT small taxpayer regime rate on gross sales	5 %Decreto 27-92 art. 47 (Decreto 4-2012), as of 2026-10-28 · in force
VAT small taxpayer regime annual sales ceiling	150000 GTQDecreto 27-92 art. 45 (Decreto 4-2012), as of 2026-10-28 · in force
Solidarity tax (ISO), creditable against income tax	1 % a year of the higher of net assets or gross income, paid quarterlyDecreto 73-2008 art. 7 and 8, as of 2026-10-28 · in force
Stamp tax on documents	3 %Decreto 37-92 art. 4, as of 2026-10-28 · in force
Statute of limitations for tax assessments	4 yearsDecreto 6-91 art. 47, as of 2026-10-28 · in force
Statute of limitations when taxpayer never registered	8 yearsDecreto 6-91 art. 48, as of 2026-10-28 · in force
Banco de Guatemala reference rate used for conversions	7.64427 GTQ per USDDecreto 94-2000 art. 4, as of 2026-10-28 · in force

The rule

1. Income tax is levied on all income obtained by individuals, companies, entities and estates, national or foreign, resident or not, but only on income obtained within the national territory. Income is taxed in three separate categories, each with its own rules and return: business income (rentas de actividades lucrativas), employment income and capital income and capital gains; nonresidents are taxed on the same categories under Title V. A company is resident if it was incorporated under Guatemalan law, has its corporate or tax domicile in Guatemala, or has its place of effective management (where direction and control of all its activities is exercised) in Guatemala; an individual is resident after more than 183 days in the calendar year or when the center of economic interests is in Guatemala, unless a foreign tax residence certificate is produced.
Cost to do it: No tax in Guatemala on foreign source income of a Guatemalan resident company; the cost is in the home country of the investor, which may tax the income differently.
Example: A Guatemalan sociedad anónima earns Q1,000,000 of interest on a deposit held abroad and Q1,000,000 of profit from sales in Guatemala: only the Guatemalan sales profit enters the Guatemalan income tax base. / About US$130,817 of foreign interest outside the Guatemalan tax base; about US$130,817 of local profit taxed.Decreto Nº 10-2012 del Congreso, Ley de Actualización Tributaria, Libro I, Impuesto Sobre la Renta (issued 16 February 2012, sanctioned 1 March 2012; Book I in force 1 January 2013), Art. 1, art. 2, art. 3, art. 6 and art. 181, 2012-02-16 official text · verified 2026-10-28

2. Business income is taxed under one of two regimes chosen at registration. Under the profit regime (Régimen Sobre las Utilidades de Actividades Lucrativas) the rate is 25 percent of taxable profit for a calendar year that must match the accounting year; tax is advanced quarterly within the month after each quarter, either on partial closings or on a presumed profit of 8 percent of quarterly gross income, and settled by an annual sworn return filed within the first three months of the following year, even when there is no income or a loss. Under the optional simplified regime on revenue (Régimen Opcional Simplificado Sobre Ingresos) tax is 5 percent of monthly gross income less exempt income up to Q30,000 and Q1,500 plus 7 percent of the excess over Q30,000, collected mainly through withholding by customers that keep full accounts. The 25 percent rate applies since 2015, after transitional rates of 31 percent in 2013 and 28 percent in 2014.
Cost to do it: 25 percent of net profit, or 5 and 7 percent of gross revenue; the profit regime needs full accounting and audited support for the return, the simplified regime mostly works through customer withholding.
Example: Annual gross revenue Q10,000,000 and taxable profit Q2,000,000: profit regime tax Q500,000; simplified regime tax about Q692,800 (12 months of Q1,500 plus 7 percent of Q803,333.33). / About US$1,308,169 revenue and US$261,634 profit: US$65,408 under the profit regime against about US$90,630 under the simplified regime.Decreto Nº 10-2012 del Congreso, Ley de Actualización Tributaria, Libro I; quarterly payment rule as reformed by Decreto Nº 19-2013 and Decreto Nº 2-2020, Art. 14, art. 36 to 39, art. 43 to 47 and art. 172, 2012-02-16 official text · verified 2026-10-28

3. Distributions of dividends, profits and earnings, whatever they are called or however they are booked, are taxed at a flat 5 percent, withheld by the payer; within regulated financial groups the tax arises only when the holding entity distributes to its shareholders. Other movable and immovable capital income (rents, interest between residents) and capital gains are taxed at 10 percent. Whoever pays capital income must withhold and pay the tax to SAT by sworn return within the first 10 days of the month after payment or bank crediting.
Cost to do it: 5 percent of each dividend, 10 percent of other capital income and gains, paid within 10 days of the following month.
Example: From Q2,000,000 of profit, the company pays Q500,000 of income tax and distributes Q1,500,000: Q75,000 dividend tax is withheld and the shareholder receives Q1,425,000, a combined burden of Q575,000 or 28.75 percent of profit. / About US$261,634 profit, US$65,408 corporate tax, US$9,811 dividend tax and US$186,414 net to the shareholder.Decreto Nº 10-2012 del Congreso, Ley de Actualización Tributaria, Libro I, Title IV; art. 94 as reformed by Decreto Nº 19-2013, Art. 92, art. 93 and art. 94, 2012-02-16 official text · verified 2026-10-28

4. Payments to nonresidents without a permanent establishment bear a final withholding by any payer that keeps full accounts, paid to SAT by sworn return within the first 10 days of the following month with a withholding certificate to the payee: 5 percent on international freight and passenger transport, insurance and reinsurance premiums, international telecommunications and dividends, profits and transfers by branches to their foreign head office; 3 percent on international news and film, music and similar content; 10 percent on interest, except interest on loans from regulated foreign banks and financial institutions and multilateral institutions as described in the article; 15 percent on salaries and other pay, payments to athletes and performers, royalties, professional fees and scientific, economic, technical or financial advice; and 25 percent on any other taxable income. If the payer fails to withhold, the nonresident must self assess within the same 10 days, and the payer remains jointly liable.
Cost to do it: 5, 10, 15 or 25 percent of the gross payment (3 percent for news and audiovisual content), with no deduction of expenses.
Example: A Q100,000 software licence royalty paid to a foreign licensor: Q15,000 withheld and paid to SAT by the 10th of the next month, Q85,000 remitted. / About US$13,082 gross, US$1,962 withheld, US$11,119 remitted.Decreto Nº 10-2012 del Congreso, Ley de Actualización Tributaria, Libro I, Title V; numeral 1 literal d repealed by Decreto Nº 19-2013, Art. 104, art. 105 and art. 106, 2012-02-16 official text · verified 2026-10-28

5. Deductible interest is capped at the interest rate allowed for tax purposes multiplied by three times the taxpayer's average total net assets (book value of assets it owns, averaging the prior and current year end values shown in its annual returns). For quetzal loans the rate cannot exceed the maximum simple annual rate the Junta Monetaria sets for tax purposes in the first 15 days of January and July based on the weighted bank lending rate; foreign loans must come from banks or financial institutions registered and supervised in the lending country, and the allowed rate is the Junta Monetaria rate less the year on year change in the quetzal against the loan currency. Supervised banks, financial companies and authorized cooperatives are outside the cap.
Cost to do it: Interest above the cap is not deductible, which raises the 25 percent tax on profit; intercompany loans from a non bank parent fall outside the foreign loan wording.
Example: With average net assets of Q10,000,000, deductible interest cannot exceed the Junta Monetaria tax rate applied to Q30,000,000 of debt. / About US$1,308,169 average net assets support deductions on up to about US$3,924,508 of debt at the allowed rate.Decreto Nº 10-2012 del Congreso, Ley de Actualización Tributaria, Libro I, Art. 24, 2012-02-16 official text · verified 2026-10-28

6. VAT applies to the sale or exchange of movable goods and rights over them, the provision of services in Guatemala, imports and other listed events, at a single rate of 12 percent of the taxable base, which must always be included in the price of goods or services; 3.5 points of the rate are earmarked for peace and development programs. General regime taxpayers file a monthly return of all operations, including exempt ones, and pay the tax within the calendar month following each monthly period. Individuals and companies with sales or services of no more than Q150,000 in a calendar year may register in the small taxpayer regime, which pays 5 percent of monthly gross sales and keeps only a simplified purchase and sales book.
Cost to do it: 12 percent of the base, recoverable as credit by registered businesses; 5 percent of gross sales in the small taxpayer regime.
Example: A sale invoiced at Q112,000 includes Q12,000 of VAT; a small taxpayer selling Q12,500 in a month pays Q625. / About US$14,651 invoiced including US$1,570 of VAT; the small taxpayer annual ceiling of Q150,000 is about US$19,623.Decreto Nº 27-92 del Congreso, Ley del Impuesto al Valor Agregado; art. 10 as worded by Decreto Nº 32-2001; art. 45 and 47 as reformed by Decreto Nº 4-2012, Art. 3, art. 10, art. 40, art. 45 and art. 47, 2001-08-01 official text · verified 2026-10-28

7. The solidarity tax (Impuesto de Solidaridad, ISO) is charged on individuals, companies, branches, trusts and other entities with their own assets that carry on commercial or agricultural activities in Guatemala and earn a gross margin above 4 percent of gross income. It is calculated each calendar quarter at 1 percent of the higher of one quarter of net assets or one quarter of gross income (gross income is used when net assets exceed four times gross income) and paid within the month after the quarter. ISO and income tax may be credited against each other: ISO paid in a year can be credited against income tax of the following three calendar years, or quarterly income tax payments can be credited against ISO of the same year; ISO not credited in that window becomes a deductible expense. Taxpayers starting business activities are exempt for their first four quarters of operation, as are entities enjoying the maquila and free zone exemptions while they last. SAT describes the tax as paid quarterly by taxpayers under the profit regime.
Cost to do it: 1 percent a year of the higher of net assets or gross income, paid quarterly; a cash cost mainly when income tax is lower than ISO or when there is a loss.
Example: Prior year gross income Q10,000,000 and net assets Q4,000,000: quarterly base Q2,500,000, ISO Q25,000 a quarter, Q100,000 a year, creditable against income tax of the next three years. / About US$3,270 a quarter, US$13,082 a year.Decreto Nº 73-2008 del Congreso, Ley del Impuesto de Solidaridad (Diario de Centro América, 22 December 2008; in force 1 January 2009), Art. 1, art. 4, art. 6 to 11 and art. 15, 2008-12-22 official text · verified 2026-10-28

8. A 3 percent stamp tax applies to the value of documents containing listed acts and contracts, including civil and commercial contracts, foreign documents when they are notarized, filed with an authority or cited in Guatemala, receipts proving payment, insurance and bond premium receipts and the second and later sales of real estate; the value is the one in the document, and cannot be lower than the value in public registries, cadastres or official lists. The taxpayer is whoever issues, signs or grants the document.
Cost to do it: 3 percent of the document value.
Example: A services contract worth Q1,000,000 signed in Guatemala bears Q30,000 of stamp tax. / About US$130,817 contract, US$3,925 stamp tax.Decreto Nº 37-92 del Congreso, Ley del Impuesto de Timbres Fiscales y de Papel Sellado Especial para Protocolos (issued 21 May 1992, in force 1 July 1992); art. 2 numeral 9 added by Decreto Nº 10-2012 art. 170, Art. 1 to 4 and art. 49, 1992-07-01 official text · verified 2026-10-28

9. Employees pay income tax through monthly withholding by the employer at 5 percent of annual taxable income up to Q300,000 and Q15,000 plus 7 percent above Q300,000. Decreto 13-2026 replaces the personal deduction with an amount equal to 12 monthly non agricultural minimum wages including the incentive bonus in force on 1 January of each year (the highest economic district wage applies), keeps the up to Q12,000 credit for VAT on personal purchases, makes the deduction update automatically when the minimum wage changes and requires SAT to publish the updated values within five business days; these changes take effect on 1 January 2027. For 2026 it grants an extraordinary deduction of Q3,024 without proof, on top of the existing deductions, applied through the employer's projection from the month after it took effect.
Cost to do it: 5 percent up to Q300,000 of taxable pay and 7 percent above, withheld monthly by the employer.
Example: An employee with Q400,000 of annual taxable income after deductions owes Q15,000 plus 7 percent of Q100,000, Q22,000, withheld in twelve monthly parts. / About US$52,327 taxable income, US$2,878 tax.Decreto Nº 10-2012 del Congreso, Libro I, Title III, as reformed by Decreto Nº 13-2026 del Congreso (Diario de Centro América, 15 May 2026), Decreto 10-2012 art. 72, art. 72 Bis, art. 73 and art. 76; Decreto 13-2026 art. 1 to 5, 2026-05-15 official text · verified 2026-10-28 · changed: Decreto 13-2026, published 15 May 2026: extraordinary Q3,024 employee deduction for 2026 (in force eight days after publication); from 1 January 2027 the personal deduction becomes 12 monthly non agricultural minimum wages including the incentive bonus, indexed automatically to the minimum wage.

10. SAT has four years to verify, adjust, rectify or determine tax obligations, assess interest and fines and demand payment, counted from the date the tax payment fell due; the same four years apply to taxpayer refund claims for overpaid tax, from the day after the overpayment, and to requests for refund of VAT credit, from the first date the law allows the request. The period extends to eight years when the taxpayer or responsible party never registered with SAT. Filing a return or the notice of an assessment interrupts the period, but a hearing notice on adjustments does not.
Cost to do it: Records and support for each return must be kept and defensible for at least four years from the due date, eight if the taxpayer never registered.
Example: Annual income tax for 2025, due by 31 March 2026, can be assessed by SAT until 31 March 2030. / Not applicable.Decreto Nº 6-91 del Congreso, Código Tributario (in force 2 October 1991); art. 47 as reformed by Decreto Nº 58-96 and Decreto Nº 4-2012, Art. 47, art. 48, art. 49 and art. 50, 1991-10-02 official text · verified 2026-10-28

Tax	Rate	Base	When paid	On Q100,000 (about US$13,082)
Income tax, profit regime	25%	Annual taxable profit	Quarterly advances; annual return by 31 March	Q25,000 on Q100,000 of profit
Income tax, simplified regime	5% up to Q30,000 a month, 7% above	Monthly gross revenue less exempt income	Monthly, mostly by customer withholding	Q6,400 on Q100,000 of revenue in one month (Q1,500 plus 7% of Q70,000)
Dividend tax	5%	Each distribution	Withheld, by the 10th of the next month	Q5,000
Other capital income and gains	10%	Rent, interest, gains	Withheld or self assessed	Q10,000
Nonresident withholding	3%, 5%, 10%, 15% or 25%	Gross payment	By the 10th of the next month	Q5,000 dividend, Q10,000 interest, Q15,000 royalty or fee, Q25,000 other
VAT	12% (5% small taxpayers)	Sales, services, imports; included in price	Monthly, in the following month	Q12,000 on a Q100,000 net price
Solidarity tax (ISO)	1% a year	Higher of net assets or gross income, by quarter	Within the month after each quarter	Q250 a quarter on a quarterly base of Q100,000
Stamp tax	3%	Value of contracts and other listed documents	On issue of the document	Q3,000

Guatemala headline taxes for a company and its foreign investors. Sources: Decreto 10-2012 art. 36, 44, 92, 93 and 104; Decreto 27-92 art. 10, 40 and 47; Decreto 73-2008 art. 7, 8 and 10; Decreto 37-92 art. 4. USD at Q7.64427.

Worked example

A foreign owned Guatemalan sociedad anónima under the profit regime has gross income of Q10,000,000 (about US$1,308,169), net assets of Q4,000,000 and taxable profit of Q2,000,000 (about US$261,634).
Solidarity tax: one quarter of gross income (Q2,500,000) is higher than one quarter of net assets (Q1,000,000), so ISO is Q25,000 a quarter and Q100,000 a year (about US$13,082), paid within the month after each quarter (Decreto 73-2008 art. 7 to 10).
Income tax: 25 percent of Q2,000,000 is Q500,000 (about US$65,408), advanced quarterly and settled by 31 March of the following year; ISO paid can be credited against it in the following three years, so it works as an advance rather than an extra cost when profits are steady (Decreto 10-2012 art. 36 to 39; Decreto 73-2008 art. 11).
Dividend: the company distributes the remaining Q1,500,000 to its foreign parent and withholds 5 percent, Q75,000 (about US$9,811), by the 10th of the following month; the parent receives Q1,425,000 (about US$186,414), and buying and wiring the dollars needs no FX approval (Decreto 10-2012 art. 93 and 104; see the FX section).
Total Guatemalan tax on the profit chain is Q575,000, 28.75 percent of profit (about US$75,220). Per US$100 of pre tax profit: US$25 corporate tax, US$3.75 dividend tax, US$71.25 to the parent. Whether the parent can credit Guatemalan tax at home depends on its own country's law; for Argentine investors that side is covered in The Argentine Thread guide.

Step by step

1. Register with SAT and choose the income tax regime at registration: profit regime at 25 percent or the optional simplified regime at 5 and 7 percent of revenue (Decreto 10-2012 art. 14 and 50); a change of regime follows art. 51.
2. Each month: file the VAT return and pay within the calendar month after the period (Decreto 27-92 art. 40); pay withholdings on dividends, capital income and payments to nonresidents within the first 10 days of the following month and issue withholding certificates (Decreto 10-2012 art. 94 and 105); withhold employee income tax monthly.
3. Each quarter: pay the income tax advance within the month after the quarter end, on partial closings or on 8 percent presumed profit (art. 38), and the solidarity tax within the same month (Decreto 73-2008 art. 10), unless in the first four quarters of operations.
4. Each year: file the annual income tax return with financial statements and support within the first three months of the year, paying the fourth quarter together with it (Decreto 10-2012 art. 38 and 39).
5. On every contract or other document outside VAT, pay the 3 percent stamp tax on its value (Decreto 37-92 art. 4).
6. Keep books, invoices and support for at least four years from each due date, the period in which SAT can audit (Decreto 6-91 art. 47).

Common traps

Assuming a foreign loan from a parent is protected. The interest withholding exception and the foreign loan wording of the interest cap cover regulated banks, financial institutions and multilaterals; interest to a non bank affiliate bears 10 percent withholding and its deductibility must fit the art. 24 cap (Decreto 10-2012 art. 24 and 104).
Treating the simplified regime as always cheaper. It taxes gross revenue, so a business with a margin below about 28 percent of revenue at the 7 percent band usually pays more than 25 percent of profit; run both numbers before registering (Decreto 10-2012 art. 36 and 44).
Forgetting the solidarity tax in loss years. ISO is due quarterly on assets or revenue even without profit, and if it cannot be credited against income tax within three years it is only a deductible expense (Decreto 73-2008 art. 7 and 11).
Calling a distribution something else. The 5 percent tax applies to any distribution of profits regardless of its name or booking (Decreto 10-2012 art. 93).
Missing the annual return because there was no income. The profit regime return is mandatory for exempt income and for years without activity (Decreto 10-2012 art. 39).
Ignoring stamp tax on foreign documents. Documents signed abroad become taxable when notarized, filed with an authority or cited in a Guatemalan notarial act (Decreto 37-92 art. 2 numeral 2).
Using 2026 employee deduction rules for 2027 payroll. From 1 January 2027 the personal deduction is 12 monthly non agricultural minimum wages including the incentive bonus, and SAT publishes the updated amount after the new minimum wage (Decreto 13-2026 art. 1, 2 and 5).
Not registering. An unregistered taxpayer can be assessed for eight years instead of four (Decreto 6-91 art. 48).

Sources

Related: Guatemala country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide

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