PARAGUAY

SOUTH AMERICA

Great talent. New possibilities.

Hire in Paraguay.

Build your team in Paraguay with a clear path from hiring to payday. Explore local employment essentials and flexible ways to engage and pay contractors with Rise.

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Explore the guide

3.27M

People in employment · Q2 2026

72.7%

Labor force participation · Q2 2026

4.1%

Unemployment rate · Q2 2026

UTC−3

Paraguay Time · year-round

IN THIS GUIDE

Paraguay at a glance

Hiring employees

Hiring contractors

Cost & take-home pay

The Rise advantage

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LOCAL KNOWLEDGE. GLOBAL AMBITION.

Your next chapter starts here.

Paraguay combines a young labor market, competitive operating costs, and a strategic position at the heart of South America. In Q2 2026, labor-force participation reached 72.7% and unemployment was about 4.1%. Start your hiring plan by choosing the right relationship for each role, then align contracts, payroll, and benefits with the Labor Code, social-security rules, and local tax requirements.

Country Snapshot

What To Know

Capital

Asunción

Currency

Paraguayan guaraní (PYG)

Working language

Spanish and Guaraní are official languages; Spanish is widely used in business.

Time zone

Paraguay Time (UTC−3), observed year-round.

Hiring approach

Local employment for ongoing roles performed under direction and dependency; independent contracts for genuinely autonomous services. The practical relationship matters more than its label.

Payroll planning

Define salary, pay frequency, MTESS registration, IPS enrollment, withholding, aguinaldo, annual leave, occupational safety, and payroll records before onboarding.

Asunción. A different perspective on your next hiring market.

BUILD YOUR LONG-TERM TEAM

Hiring employees in the Paraguay

For roles that sit inside your organization, start with a local employment arrangement. Budget for the full employment package and identify who will handle employer registration, Ministry of Labor records, IPS enrollment, payroll deductions, benefits, and ongoing filings.

Employment Essential

At a Glance

Employment terms

Labor Code Law No. 213/93 governs most private employment. Written terms are strongly recommended. The standard daytime limit is 8 hours per day and 48 hours per week. From July 1, 2026, the general monthly minimum wage is ₲3,044,000.

Salary payments

Employees are usually paid monthly in guaraníes. Employers register employees with the Instituto de Previsión Social (IPS), withhold the employee contribution, pay the employer contribution, and maintain required wage and employment records.

Annual bonus

A statutory aguinaldo is generally equal to one twelfth of remuneration earned during the calendar year and is payable by December 31.

Paid annual leave

Minimum paid leave is 12 working days for service up to five years, 18 working days after five to ten years, and 30 working days after ten years, subject to the Labor Code.

Employer cost planning

Budget for the employer IPS contribution, aguinaldo, paid leave, public holidays, occupational health and safety, any contractual benefits, and potential termination obligations.

Employment framework: Paraguay Labor Code, Law No. 213/93 and amendments; Instituto de Previsión Social rules; MTESS requirements; and applicable tax rules. Requirements vary by role, pay, working pattern, and benefit design.

Employer of Record

Explore an employment route with Rise.

Rise EOR manages local employment contracts, payroll, and compliance in supported markets. Discuss your Paraguay hiring plan with the team to confirm availability, timing, and the right setup.

Explore Employer of Record

Paraguay EOR availability should be confirmed with Rise before making an offer, including the employing entity, benefits package, and onboarding timeline.

WORK WITH INDEPENDENT SPECIALISTS

Hiring contractors in Paraguay

Bring independent expertise into your business with clear deliverables, documented terms, and a reliable payment process. A contractor relationship can be reclassified where day-to-day reality shows direction, dependency, fixed hours, or integration similar to employment.

Set Up For Success

Your Contractor Checklist

Scope & autonomy

Agree on outputs, timelines, and independent working practices. Avoid employee-style supervision, exclusivity, fixed schedules, and benefits where the engagement is intended to remain independent.

Service agreement

Document fees, currency, payment timing, VAT treatment, intellectual property, confidentiality, data protection, and termination terms.

Tax & invoicing

Confirm the contractor’s RUC registration and ability to issue a valid invoice. Paraguay’s standard VAT rate is 10%, though the treatment depends on the service, customer, and place of use. Independent professionals manage their own income-tax obligations where applicable.

Onboarding

Collect identity and payment details, signed agreements, tax registration, and the documentation your engagement requires.

Payment preferences

Agree on supported withdrawal options and make fees, conversion, and settlement expectations clear. Confirm whether the contractor wants funds received in PYG, USD, or a supported digital asset.

Global Contractor Pay

One place to manage payday.

Onboard your contractors, organize payments, and fund payroll in USD or supported stablecoins. Give contractors flexibility over supported withdrawals, including PYG where available.

Explore Global Contractor Pay

Agent of Record

More support for your engagements.

Add contractor classification, contracts, onboarding, and compliance support. Ask Rise about the scope of coverage for your Paraguay team.

Explore Agent of Record

Historic Asunción. Local character, connected to a world of opportunity.

PLAN BEYOND THE HEADLINE SALARY

What does hiring in Paraguay actually cost?

Start with the agreed gross salary or contractor fee, then separate business costs from worker deductions. The examples below use Paraguayan guaraníes (PYG), apply indicative 2026 rates, and illustrate a budget, not a final payslip or quote.

BUSINESS BUDGET

Employer costs

Cost

Budget Basis

Gross salary

100% of agreed pay

Employer social security

Generally 16.5% of covered remuneration paid to IPS.

Employee social-security deduction

Generally 9% withheld from the employee’s covered remuneration and remitted to IPS.

Aguinaldo reserve

About 8.33% of monthly remuneration to fund the statutory annual bonus.

Leave and holidays

Budget for paid annual leave, public holidays, and any coverage needed during absence.

Rise service fees

Request a separate platform or EOR/AOR quote, subject to Paraguay coverage.

EMPLOYEE PAYSLIP

Employee deductions

Deduction

Indicative Treatment

Employee IPS

Generally 9% of covered remuneration.

Personal income tax (IRP)

Applies when statutory conditions and thresholds are met; progressive rates are generally 8%, 9%, and 10% on taxable net income.

Other deductions

May include court orders, approved advances, or employee-elected benefits.

Net Pay

Gross salary less employee IPS, applicable IRP withholding or payments, and authorized deductions.

WORKED EXAMPLE · ₲10,000,000 GROSS / MONTH

One salary. Two different numbers.

Employer monthly budget equivalent

₲12,483,333

Gross salary, employer IPS, and aguinaldo reserve

Employee regular-month pay

₲9,100,000

After employee IPS, before any applicable IRP or personal deductions

Employer Budget Component

Core Payroll

With Aguinaldo Reserve

Monthly gross salary

₲10,000,000

Employer IPS, illustrative 16.5%

₲1,650,000

Aguinaldo reserve, 1/12

Not included

₲833,333

Monthly budget equivalent

₲11,650,000

₲12,483,333

Illustration applies the general 16.5% employer and 9% employee IPS rates. It excludes leave coverage, private benefits, occupational-risk costs, termination exposure, IRP, and Rise fees. Confirm the contribution base and tax treatment for the specific employee.

Contractor costs: what the business pays, what the contractor keeps.

A contractor’s invoice is business revenue. The contractor needs to budget for income tax, VAT administration, retirement savings, health cover, time off, and operating expenses before treating it as spendable income.

Cost Item

Hiring Business

Contractor

Service fee

Agreed invoice plus VAT where applicable.

Receives the agreed fee before their own costs and tax.

Tax & social coverage

No employee IPS contributions apply to a genuine independent contractor. Check any local withholding or reporting obligations.

Manages RUC registration, invoicing, VAT, and IRP obligations where applicable, plus voluntary protection and savings.

Payment & administration

Add the agreed Rise plan, payment fees, and any conversion costs.

Confirm who bears withdrawal and conversion fees and the settlement currency.

Benefits & operating costs

Include any negotiated allowances in the contract.

Set aside amounts for health cover, retirement, equipment, accounting, and non-billable time.

Independent tax: what a Paraguayan freelancer pays

Component

2026 Rate or Rull

IRP-RSP entry threshold

Registration is generally triggered after annual taxable personal-service income exceeds ₲80,000,000.

IRP-RSP rates

Progressive rates of 8% on taxable net income up to ₲50,000,000, 9% from ₲50,000,001 to ₲150,000,000, and 10% from ₲150,000,001 upward.

VAT

Independent services are generally subject to 10% VAT when taxable in Paraguay. The provider issues an invoice, reports output VAT, and may credit eligible input VAT.

Filing cycle

VAT is generally reported monthly. IRP-RSP is calculated and filed annually under the DNIT calendar.

Contractor Example

₲10,000,000 invoiced per month

At ₲120,000,000 over 12 months, a contractor should first identify deductible costs and whether IRP applies. At an illustrative 8% rate on fully taxable net income, the monthly tax equivalent would be ₲800,000, leaving ₲9,200,000 before VAT settlement, health cover, retirement savings, payment fees, business expenses, and personal reserves.

Actual IRP depends on taxable net income, statutory thresholds, deductions, and progressive rates. This is not equivalent to an employee’s net salary: the contractor example includes no aguinaldo, paid leave, employer-funded IPS, or employment protection.

Make Your Budget Specific

Get a breakdown for your actual hire.

Share the role, city, gross salary or contractor fee, benefits, tax status, and preferred payment method. Ask Rise to separate statutory costs, service fees, and payment costs in your quote.

Book a demo for a custom cost breakdown

THE RISE ADVANTAGE

A better payday. A better team experience.

Give your global workforce more choice in how they receive their earnings, with payroll built around the way people work.

Daily payroll. More flexibility.

With daily pay schedules, eligible employees can receive pay more frequently and better align income with everyday expenses.

Mon

Tue

Wed

Thu

Fri

Dicover Rise Direct Payroll

Daily payroll is available through Rise’s US Direct Payroll product. Confirm eligibility, state pay-frequency and final-pay rules, and setup with Rise.

Hybrid payroll. More choice.

Connect traditional and crypto payments. Fund payroll in USD, USDC, or USDT, with supported local-currency and crypto withdrawal options for your team.

USD

USDC

USDT

Explore Rise Hybrid Payroll

Options depend on location and engagement type. US employee wages must be paid in US dollars through compliant methods under federal and state wage-payment law; crypto withdrawals are a post-payroll option and do not replace those obligations.