What is ISR in Guatemala?
The Impuesto Sobre la Renta (ISR) is Guatemala's main direct tax, regulated by Decree 10-2012. It taxes income earned by individuals and legal entities.
ISR Tax Regimes
Simplified Optional Regime (On Gross Income)
- 5% on the first Q30,000 of monthly income
- 7% on the excess over Q30,000/month
- Calculated and paid monthly
- No expense deductions allowed
Profits Regime (On Net Income)
- 5% on the first Q300,000 of annual taxable income
- 7% on the excess over Q300,000/year
- Allows documented expense deductions
- Q48,000 annual personal deduction
- Quarterly payments
Which regime is better?
If your deductible expenses are significant (more than 30% of income), the profits regime may be more favorable. If you don't have many documented expenses, the simplified regime is easier.