Guatemala Income Tax (ISR) Calculator: Complete Guide 2026

The Impuesto Sobre la Renta (ISR) is the most important tax in the Guatemalan fiscal system, affecting both individuals and legal entities that generate income within the national territory. With recent tax reforms, it's crucial to understand how to correctly calculate this tax to comply with fiscal obligations and optimize tax burden.

What is ISR in Guatemala?

The Impuesto Sobre la Renta (ISR) is a direct tax regulated by Decree Number 10-2012 "Tax Update Law" and its subsequent reforms. This tax levies on income obtained in Guatemalan territory by all individuals or legal entities, Guatemalan or foreign, domiciled or not in the country.

Current Legal Framework

Main legislation:

• Decree 10-2012 "Tax Update Law"
• Decree 4-2012 "Tax Update Law" (reforms)
• Decree 13-2020 (COVID-19 reforms)
• Decree 9-2021 (latest significant reform)
• Government Agreement 213-2013 (Regulation)

Principles of Guatemalan ISR

1. Universality: Taxes all income obtained in Guatemala
2. Progressivity: Differentiated rates according to income level
3. Annuality: Calculated on annual basis (with provisional payments)
4. Personality: Considers the taxpayer's particular situation

ISR Regimes for Individuals

Simplified Optional Regime on Income

This regime is aimed at taxpayers with business activities who prefer administrative simplicity over tax optimization.

Main Characteristics

• Tax base: Gross income (without expense deductions)
• Periodicity: Monthly
• Annual limit: No billing limit
• Advantage: Administrative simplicity
• Disadvantage: Doesn't allow expense deductions

Current 2026 Rates

| Monthly Income Range | Rate | |---------------------|------| | From Q0.01 to Q30,000 | 5% | | Over Q30,000 | 7% on excess |

Calculation Formulas

For income ≤ Q30,000:

Monthly ISR = Monthly income × 5%

For income > Q30,000:

Monthly ISR = (Q30,000 × 5%) + ((Monthly income - Q30,000) × 7%)
Monthly ISR = Q1,500 + ((Monthly income - Q30,000) × 7%)

Practical Examples Simplified Regime

Example 1: Independent professional with Q25,000 monthly

• Monthly ISR: Q25,000 × 5% = Q1,250
• Annual ISR: Q1,250 × 12 = Q15,000

Example 2: Consultant with Q45,000 monthly

• First bracket: Q30,000 × 5% = Q1,500
• Second bracket: (Q45,000 - Q30,000) × 7% = Q1,050
• Monthly ISR: Q1,500 + Q1,050 = Q2,550
• Annual ISR: Q2,550 × 12 = Q30,600

Regime on Profits from Lucrative Activities

This regime allows expense deductions and is more favorable for taxpayers with significant documented expenses.

Main Characteristics

• Tax base: Net income (income minus deductible expenses)
• Periodicity: Quarterly provisional payments, annual settlement
• Personal deduction: Q48,000 annually
• Advantage: Allows documented expense deductions
• Complexity: Requires formal accounting

Current 2026 Rates

| Annual Taxable Income Range | Rate | |---------------------------|------| | From Q0.01 to Q300,000 | 5% | | Over Q300,000 | 7% on excess |

Calculation Formulas

1. Taxable Income Calculation:

Taxable Income = Annual Income - Deductible Costs and Expenses - Personal Deduction (Q48,000)

2. ISR Calculation:

For income ≤ Q300,000:
ISR = Taxable Income × 5%

For income > Q300,000:
ISR = (Q300,000 × 5%) + ((Taxable Income - Q300,000) × 7%)
ISR = Q15,000 + ((Taxable Income - Q300,000) × 7%)

Practical Examples Profits Regime

Example 1: Independent professional

• Annual income: Q600,000
• Deductible expenses: Q200,000
• Personal deduction: Q48,000
• Taxable income: Q600,000 - Q200,000 - Q48,000 = Q352,000

ISR Calculation:

• First bracket: Q300,000 × 5% = Q15,000
• Second bracket: (Q352,000 - Q300,000) × 7% = Q3,640
• Annual ISR: Q15,000 + Q3,640 = Q18,640

Example 2: Merchant

• Annual income: Q480,000
• Deductible expenses: Q180,000
• Personal deduction: Q48,000
• Taxable income: Q480,000 - Q180,000 - Q48,000 = Q252,000

ISR Calculation:

• Since Q252,000 < Q300,000, only first bracket applies
• Annual ISR: Q252,000 × 5% = Q12,600

Deductible Expenses in Profits Regime

Generally Deductible Expenses

1. Wages and salaries: Includes labor benefits
2. Rent: Of properties used to generate taxed income
3. Basic services: Energy, water, business phone
4. Materials and supplies: Directly related to activity
5. Depreciation: According to law's useful life tables
6. Insurance: Protecting assets generating taxed income
7. Interest: From business loans
8. Travel expenses: Proven and activity-related

Non-Deductible Expenses

1. Personal or family expenses
2. Fines and penalties
3. Undocumented expenses without invoices
4. Accounting reserves or provisions
5. Representation expenses (limited to 0.5% of gross income)

Deductibility Requirements

For an expense to be deductible it must meet:

1. Causality: Be directly related to generating taxed income
2. Necessity: Be normal in business activity
3. Documentation: Backed by valid electronic invoice
4. Proportionality: Not be excessive relative to expected benefit
5. Accounting records: Be properly recorded in accounting

Provisional Payments and Annual Settlement

Quarterly Payment System

Taxpayers in the profits regime must make quarterly provisional payments:

Quarterly Payment Calculation

Method 1 - On quarter's income:

Quarterly payment = Quarter's income × 2%

Method 2 - On estimated taxable income:

Quarterly payment = (Estimated annual taxable income × corresponding rate) ÷ 4

2026 Quarterly Payment Calendar

| Quarter | Period | Due Date | |---------|--------|----------| | 1st | January-March | April 30 | | 2nd | April-June | July 31 | | 3rd | July-September | October 31 | | 4th | October-December | January 31, 2027 |

Annual Settlement

Final settlement is filed between January 1 and March 31 of the following year:

ISR to pay = Annual calculated ISR - Provisional payments made

If provisional payments exceed final ISR, the taxpayer has the right to request refund or compensation.

Special ISR Cases

Dependent Employees

Salaried employees are subject to ISR withholding by the employer:

2026 Monthly Withholding Table

| Monthly Salary Range | Accumulated ISR | On Excess | |---------------------|-----------------|-----------| | Q0 - Q3,000 | Q0 | 0% | | Q3,001 - Q6,000 | Q0 | 5% | | Q6,001 - Q15,000 | Q150 | 7% | | Q15,001 and up | Q780 | 10% |

Salary Withholding Example

Employee with Q8,500 monthly salary:

• Exempt bracket: Q3,000 → Q0
• First bracket: (Q6,000 - Q3,000) × 5% = Q150
• Second bracket: (Q8,500 - Q6,000) × 7% = Q175
• Monthly withholding: Q0 + Q150 + Q175 = Q325

Licensed Liberal Professionals

Licensed professionals have special options:

1. General regime: Like any other lucrative activity
2. 5% flat rate: On gross income (without expense deduction)
3. 15% withholding: When providing services to companies

Legal Entities

Commercial companies pay ISR on their profits:

• Rate: 25% on pre-tax profits
• Quarterly payments: Mandatory
• Accounting close: December 31
• Settlement: Until March 31 of following year

Tax Incentives and Benefits

ISR Exemptions

1. Aguinaldo: First Q500 is exempt
2. Bonus 14: First Q500 is exempt
3. Labor severance: According to legal limits
4. Bank interest: Up to Q1,000 annually for individuals
5. Pensions: From IGSS and authorized private systems

Special Deductions

Expanded Personal Deduction

In addition to the basic Q48,000, you can deduct:

• Medical expenses: Up to Q5,000 annually
• Educational expenses: Up to Q3,000 annually per child under 25
• Mortgage credit interest: Up to Q12,000 annually
• Donations: Up to 5% of gross income, maximum Q500,000

SME Incentives

1. First years exemption: New companies may be exempt up to 2 years
2. Accelerated depreciation: For productive assets
3. Employment tax credit: For hiring first jobs

Formal Obligations to SAT

Registration and Registry

1. RTU (Unified Tax Registry): Mandatory for all taxpayers
2. Regime choice: At registration or annual change
3. Data update: Within 30 days of any change

Electronic Invoicing (FEL)

Since 2019, issuing Electronic Online Invoices is mandatory:

• FEL System: Certification with authorized provider
• Immediate issuance: At time of sale or service provision
• Conservation: 4 years in electronic format

Books and Accounting Records

Simplified Regime

• Income Book: Chronological record of all invoices issued
• Purchase Book: Record of all purchases with invoice

Profits Regime

• Main books: Journal, Ledger, Inventories, Financial Statements
• Auxiliary books: Banks, Clients, Suppliers, etc.
• Legalization: Before SAT before first use

Declarations and Payments

2026 Tax Calendar

| Obligation | Regime | Due Date | |------------|--------|----------| | Monthly ISR | Simplified | 10th of each month | | Quarterly ISR | Profits | According to quarterly table | | Annual Settlement | Profits | March 31 | | Monthly VAT | Both | 10th of each month |

Regime Comparison: Which to Choose?

Comparative Analysis

To determine the most convenient regime, consider:

Simplified Regime is better when:

• Deductible expenses < 30% of income
• You prefer administrative simplicity
• You don't have formal accounting structure
• Stable and predictable income

Profits Regime is better when:

• Deductible expenses > 40% of income
• You have significant medical, educational, mortgage expenses
• You have professional accounting advice
• You seek tax optimization

Practical Comparative Example

Professional with:

• Annual income: Q600,000
• Documented expenses: Q150,000
• Medical expenses: Q5,000
• Educational expenses: Q3,000

Simplified Regime:

• First Q360,000 (Q30,000×12): Q360,000 × 5% = Q18,000
• Excess Q240,000: Q240,000 × 7% = Q16,800
• Total ISR: Q34,800

Profits Regime:

• Net income: Q600,000 - Q150,000 - Q48,000 - Q5,000 - Q3,000 = Q394,000
• First bracket: Q300,000 × 5% = Q15,000
• Second bracket: (Q394,000 - Q300,000) × 7% = Q6,580
• Total ISR: Q21,580

Savings: Q34,800 - Q21,580 = Q13,220 (38% less tax)

Penalties and Fines

Common Infractions and Fines

| Infraction | Fine | Observations | |------------|------|--------------| | Not registering in RTU | Q500 - Q15,000 | According to delay time | | Late filing | 10% of tax | Minimum Q500 | | Not filing return | Q5,000 - Q50,000 | According to taxpayer size | | Tax evasion | 100% of evaded tax | Plus interest | | Not implementing FEL | Q1,000 - Q10,000 | Per month of non-compliance |

Compensatory Interest

SAT charges interest on taxes paid late:

• Annual rate: 18.25% (2026)
• Calculation: Daily from due date to payment

Frequently Asked Questions about ISR

Can I change regimes during the year?

No. Regime change can only be made for the following year, notifying SAT before December 31.

What if I work for a company and have independent income?

You must declare both incomes. Independent income is handled according to chosen regime, and you have the right to credit withholdings made by the employer.

Do foreigners pay ISR in Guatemala?

Yes, all persons (national or foreign) who obtain income in Guatemala are obligated to pay ISR.

What documents do I need to deduct expenses?

Only electronic invoices issued by providers registered with SAT. Receipts, debit notes, or informal documents are not accepted.

Can I deduct my personal vehicle expenses if I use it for business?

Yes, but only proportionally to commercial use. You must maintain detailed records of commercial vs personal use.

How do I handle ISR if I have losses?

In the profits regime, losses can be offset against profits from the following 3 years. In the simplified regime this concept doesn't apply.

What happens if I don't file my return on time?

In addition to the 10% fine (minimum Q500), SAT can determine your tax obligation ex officio, generally with amounts higher than actual.

Useful Tools and Resources

SAT Online Platform

SAT offers digital services for:

• RTU registration
• Filing returns
• Tax status consultation
• Certification requests
• Online payments

Recommended Accounting Software

For profits regime:

• Aspel COI: Guatemalan comprehensive solution
• ContaPlus: For small businesses
• SAP Business One: For medium companies
• Custom Excel: For simple independent professionals

Professional Advice

When to hire an accountant:

• Annual income > Q500,000
• Multiple income sources
• Complex deductible expenses
• Tax compliance concerns

Related calculators:

• Guatemala Aguinaldo Calculator
• Guatemala Vacations Calculator
• Tips Calculator

Official resources:

• SAT Guatemala: portal.sat.gob.gt
• Tax Code: www.congreso.gob.gt
• SAT Forms: formularios.sat.gob.gt

Last update: March 2026 - Current rates and procedures