Paraguay vs United Kingdom
Tax Residency Comparison
Paraguay taxes foreign income at 0% through its territorial system, while United Kingdom taxes residents at up to 45%. British switching to Paraguay residency save $40,000 - $150,000+ 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 | 🇬🇧 United Kingdom |
|---|---|---|
| Foreign Income Tax | 0% | up to 45% |
| Capital Gains Tax | 8% | up to 28% |
| Corporate Tax | 10% | 25% |
| Inheritance/Estate Tax | None | 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 British Choose Paraguay
Save $40,000 - $150,000+/Year
The average british moving to Paraguay saves $40,000 - $150,000+ annually by eliminating up to 45% taxes on foreign-sourced income.
Territorial Tax System
Unlike United Kingdom's worldwide taxation, Paraguay only taxes income generated within its borders. Foreign income is generally exempt.
Location Freedom
While United Kingdom 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 United Kingdom Tax Problem
High income tax rates for high earners
National Insurance contributions
Dividend tax on company profits
Inheritance tax up to 40%
Important: Leaving United Kingdom
UK residents can become non-domiciled by establishing genuine residency abroad. Paraguay offers a straightforward path to break UK tax residency.
Our team includes specialists familiar with United Kingdom tax law who can help you navigate the transition properly and legally.
Who Should Consider Paraguay Over United Kingdom?
Remote Workers
Keep 100% of your foreign-earned income instead of losing up to 45% to taxes.
Entrepreneurs
Build your business without the United Kingdom tax burden holding you back.
Investors
Optimize capital gains with Paraguay's favorable 8% rate vs up to 28%.
Retirees
Stretch your pension and investments further with minimal tax obligations.
Frequently Asked Questions
Is Paraguay better than the United Kingdom for taxes?
For foreign income, Paraguay charges 0% compared to the UK's 45% top rate. Paraguay also has no inheritance tax, no National Insurance, and no capital gains tax on foreign investments, making it significantly more tax-efficient.
What's the tax difference between Paraguay and the United Kingdom?
The UK taxes worldwide income at up to 45%, capital gains at up to 28%, and estates at 40%. Paraguay taxes only local income at a flat 10%, with zero tax on foreign income, no inheritance tax, and no wealth tax.
Can British get Paraguay residency easily?
Yes. British citizens enter Paraguay visa-free and can apply directly for permanent residency. The straightforward process takes 4-6 weeks and does not require language proficiency or a large financial investment.
Explore More Resources
Everything you need to make an informed decision about Paraguay residency
Ready to Compare Your Savings?
Calculate exactly how much you could save by moving from United Kingdom to Paraguay.
Last reviewed: February 2026