Paraguay vs Netherlands
Tax Residency Comparison
Paraguay taxes foreign income at 0% through its territorial system, while Netherlands taxes residents at up to 49.5%. Dutch switching to Paraguay residency save $40,000 - $160,000+ per year on average, with a fast 90-day process and only a $5,000 bank deposit required.
Side-by-Side Tax Comparison
| Category | 🇵🇾 Paraguay | 🇳🇱 Netherlands |
|---|---|---|
| Foreign Income Tax | 0% | up to 49.5% |
| Capital Gains Tax | 8% | Box 3 wealth tax |
| Corporate Tax | 10% | 25.8% |
| Inheritance/Estate Tax | None | 10-40% |
| Residency Timeline | 90 days | N/A |
| Investment Required | $5,000 bank deposit | N/A |
| Physical Presence | Once every 3 years | 183+ days/year |
| Path to Citizenship | 3 years to citizenship | Varies |
Why Dutch Choose Paraguay
Save $40,000 - $160,000+/Year
The average dutch moving to Paraguay saves $40,000 - $160,000+ annually by eliminating up to 49.5% taxes on foreign-sourced income.
Territorial Tax System
Unlike Netherlands's worldwide taxation, Paraguay only taxes income generated within its borders. Foreign income is generally exempt.
Location Freedom
While Netherlands requires 183+ days presence, Paraguay only requires a visit once every 3 years to maintain residency.
Fast Process
Get permanent residency in just 90 days. No years of waiting, no complex point systems, no quotas.
The Netherlands Tax Problem
Unique box system taxation
Deemed income on assets (Box 3)
High employer social contributions
30% ruling expiration
Important: Leaving Netherlands
Dutch tax residents face complex exit procedures. Paraguay residency provides legitimate grounds for establishing non-resident status.
Our team includes specialists familiar with Netherlands tax law who can help you navigate the transition properly and legally.
Who Should Consider Paraguay Over Netherlands?
Remote Workers
Keep 100% of your foreign-earned income instead of losing up to 49.5% to taxes.
Entrepreneurs
Build your business without the Netherlands tax burden holding you back.
Investors
Optimize capital gains with Paraguay's favorable 8% rate vs Box 3 wealth tax.
Retirees
Stretch your pension and investments further with minimal tax obligations.
Frequently Asked Questions
Is Paraguay better than the Netherlands for taxes?
For foreign income and asset taxation, Paraguay is significantly better. The Netherlands' Box 3 taxes deemed income on assets at up to 36%, while Paraguay charges nothing on foreign income or assets. Income tax is also much lower.
What's the tax difference between Paraguay and the Netherlands?
The Netherlands taxes income at up to 49.5%, deemed investment income via Box 3, and inheritance at 10-40%. Paraguay taxes only local income at a flat 10%, with no tax on foreign income, no deemed income tax, and no inheritance tax.
Can Dutch get Paraguay residency easily?
Yes. Dutch citizens enter Paraguay visa-free and can apply directly for permanent residency. The process takes 4-6 weeks with minimal documentation and no language requirements.
Explore More Resources
Everything you need to make an informed decision about Paraguay residency
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Last reviewed: February 2026