Paraguay
Capital Asunción
What it actually costs to live here
Directional monthly estimates by city and lifestyle (USD). Not gospel — your numbers will vary.
| Category | Asunción | Ciudad del Este | Encarnación |
|---|---|---|---|
| Rent (1BR) | $395.406 | $319.794 | $318.71 |
| Groceries | $291.78 | $226.62 | $251.82 |
| Transport | $66.775 | $79.918 | $34.144 |
| Total | $753.961 | $626.332 | $604.674 |
What the indicators say
Normalized cost-of-living, tax burden, property rights, and economic freedom (0–100, higher is better).
- Currency
- Paraguayan Guaraní (₲)
- Economy
- Developing market economy
What you owe, and to whom
US tax-treaty status, residency triggers, and state-exit considerations.
Paraguay has neither an income tax treaty nor a Social Security totalization agreement with the US — no coverage on either axis. Paraguay runs a territorial tax system: only locally-sourced income is taxed (at a 10% top rate), so foreign-sourced income such as remote work for US clients is generally not taxed locally. Americans still rely on the FEIE and Foreign Tax Credit, and self-employed Americans owe 15.3% US SE tax with no offset. US filing (including FBAR/FATCA) always remains.
No Income Tax Treaty
No Treaty ProtectionParaguay has no income tax treaty with the US. Americans rely entirely on the FEIE and FTC to avoid double taxation. There is no treaty-rate withholding on dividends or interest.
No Totalization Agreement
Double SS Taxation RiskParaguay has no Social Security totalization agreement with the US. Self-employed Americans owe 15.3% US SE tax on top of any local social insurance. The FEIE does not cover SE tax.
Territorial Tax System
Only Local Income TaxedParaguay taxes only locally-sourced income at a 10% top rate. Foreign-sourced income (remote work for US clients, US investments) is generally not taxed locally.
US Filing Never Stops
FBAR / FATCAUS citizens file annually regardless of residence. Paraguayan accounts over $10K trigger FBAR; FATCA applies. The FEIE ($126,500 for 2024) and FTC are the primary double-taxation relief mechanisms.
Americans should know
- You file US taxes regardless — Paraguayan residency doesn't change that
- Paraguay is territorial: only local-source income is taxed (10% top rate), so foreign remote income is generally untaxed locally
- There is no US–Paraguay tax treaty or totalization agreement — self-employed Americans pay 15.3% US SE tax with no offset
- Paraguayan accounts over $10K trigger FBAR reporting; FATCA applies — budget for a cross-border CPA
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