Permanent residence in Paraguay

[geonove]

Hello everyone,

I am looking for establishing residency in a foreign country and live as a nomad for tax benefits.

Someone had recommended me Paraguay as an easy destination for a permanent visa, and on a Facebook group someone else recommended ParaguaySolutions as a reliable provider.

Questions:

- Has anyone used them and can comment?
- How long does it take to get the Paraguayan ID?
- Can I do this myself rather than through an agent?

Thanks everybody for any help

 

[Outlander]

I have used them. Very professional and courteous. They advised me to go to Asuncion for 4 days, but the day after I arrived the process was complete. The ID was mailed about 4 months later to my hideout in Asia.

Don't take my testimony as an endorsement though. I can only speak for myself.

I think technically it's possible to do the process yourself but if you don't speak the language and don't intend to spend a considerable amount of time there navigating the idiosyncrasies of the local bureaucracy, it's absolutely not worth considering.

 

[JustAnotherNomad]

How much was it?

You’ll want to make sure there is a tax treaty in place with the countries you actually spend time in. Otherwise you Paraguay tax residency won’t mean much.

 

[Outlander]

How much was it?

Price was $2k EUR plus travel costs, or whereabouts.

You’ll want to make sure there is a tax treaty in place with the countries you actually spend time in. Otherwise you Paraguay tax residency won’t mean much.

I think it does mean a lot if you live like a nomad or a semi-nomad. Getting the ID doesn't mean you become an official tax residence by magic - only living in Paraguay continuously does. Since I don't live in Paraguay (nor anywhere else for far too long), and my strongest links are to Paraguay (residence + property), a self-certification that my residence for tax purposes is Paraguay is good enough for me. I've run this setup with multiple lawyers and they agreed, but do your own research.

 

[JustAnotherNomad]

Thanks.

Yes, of course, if no other country could possibly claim you as a tax resident, then it doesn’t matter.

 

[Marzio]

my strongest links are to Paraguay (residence + property)

Are you renting an apartment there or decided to buy a property? Which bank have you used to make the $5k deposit?

 

[Outlander]

Are you renting an apartment there or decided to buy a property? Which bank have you used to make the $5k deposit?

I purchased property. You don't need to to that in order to have the PR. An address is kind of assigned to you in the immigration process and I understood (without asking) that they have a pool of addresses which they use for "immigration purposes". So that virtual address goes into your Life & Residence certificate, which is as good as any utility bill for opening a bank account, even abroad.

The $5k guarantee deposit is made at Banco de Fomento - only there. However if you can prove you have a University degree, that fee is waived.

 

[Marzio]

that virtual address goes into your Life & Residence certificate, which is as good as any utility bill for opening a bank account, even abroad.

Have you ever had problems with opening a non resident bank account by being a resident of Paraguay? I mean opening a bank account in a safe jurisdiction like Singapore, Switzerland, Germany and so on.

 

[Outlander]

Have you ever had problems with opening a non resident bank account by being a resident of Paraguay? I mean opening a bank account in a safe jurisdiction like Singapore, Switzerland, Germany and so on.

I have opened bank accounts in the United States (personal and corporate) and Singapore (corporate), as well as in a variety of other less hot jurisdictions, all while using the Paraguayan address for the beneficial owner. Also used it for stock brokerage and crypto exchange accounts and had no issues whatsoever in the last 3 years.

I didn't try bank accounts in the EU because I don't want to have an account there, but I don't see why it wouldn't work.

 

[Outlander]

I have opened bank accounts in the United States (personal and corporate) and Singapore (corporate), as well as in a variety of other less hot jurisdictions, all while using the Paraguayan address for the beneficial owner. Also used it for stock brokerage and crypto exchange accounts and had no issues whatsoever in the last 3 years.

I didn't try bank accounts in the EU because I don't want to have an account there, but I don't see why it wouldn't work.

Actually I now remember I did open an account at Bankera for SEPA access. While not technically a bank, it's in the EU.

 

[Marzio]

I asked because on that page you'll see which tax residencies OECD thinks of being high risk for circumventing CRS reporting.

Paraguay residency isn't on the list but offers the same product of Panama and Panama is considered by OECD a high risk country, the effect of that is that some banks are refusing to open bank accounts to panama residents (i've only read that, no personal experience).

Hopefully PY will continue to fly under the radar.

One last thing, are you using a US LLC as a business vehicle?

Thanks!

 

[Outlander]

I asked because on that page you'll see which tax residencies OECD thinks of being high risk for circumventing CRS reporting.

Paraguay residency isn't on the list but offers the same product of Panama and Panama is considered by OECD a high risk country, the effect of that is that some banks are refusing to open bank accounts to panama residents (i've only read that, no personal experience).

Hopefully PY will continue to fly under the radar.

One last thing, are you using a US LLC as a business vehicle?

Thanks!

Yes I saw that list. I love Paraguay because they're so low profile that even the OECD forgets about it.

I'm not using a US LLC. I use a IBC company in the Caribbean.

 

[JustAnotherNomad]

I think it does mean a lot if you live like a nomad or a semi-nomad. Getting the ID doesn't mean you become an official tax residence by magic - only living in Paraguay continuously does. Since I don't live in Paraguay (nor anywhere else for far too long), and my strongest links are to Paraguay (residence + property), a self-certification that my residence for tax purposes is Paraguay is good enough for me. I've run this setup with multiple lawyers and they agreed, but do your own research.

Actually I believe that without a tax treaty, you potentially have to pay taxes on any money earned from any country, since most countries tax all income generated on their land.
Say you are a traveling consultant, you spend a week with a client in each country, constantly hopping around between countries. With a tax treaty, the rule is usually that you pay taxes in your home country, unless you become a tax resident in that country, or unless your company has a permanent establishment there.
But if there is no tax treaty, in theory you would have to pay taxes immediately, even though you are not tax resident.
But I agree that is probably an academic hypothesis and not something you’d need to worry about in real life. Except with countries like the US and especially when you are traveling on a business visa. In such a case I would probably want to consult with an accountant just to be on the safe side.

 

[jlf]

Yes I saw that list. I love Paraguay because they're so low profile that even the OECD forgets about it.

I'm not using a US LLC. I use a IBC company in the Caribbean.

Would you mind explaining the process of opening a US corporate bank account for your IBC company? Did you register it in the state you opened the account or just issued an EIN? Tks!

 

[Outlander]

Would you mind explaining the process of opening a US corporate bank account for your IBC company? Did you register it in the state you opened the account or just issued an EIN? Tks!

Without goint too deep into which bank, the process took months (final approval by the board hit a long queue) but was rather simple. My Registered Agent introduced me to the bank manager, I explained my business model and source of funds, then I filled a thousand forms, signed a thousand papers, and mailed everything back to the manager.

The EIN was taken care of by my manager after the account was already open. No state registration was required.

I got both a personal and a corporate account, in USD and EUR, and (good) credit cards. Yes, I used the address in Paraguay but the cards were mailed to a very different location.

I know at least two banks in the US which will open accounts on a case by case basis to IBCs, but don't expect to make a $5k deposit and forget about it. You're a high risk customer and they want to profit from you.

Though these are medium banks and service sometimes isn't top notch, it serves me extremely well.

 

[Marzio]

I got both a personal and a corporate account, in USD and EUR

This is interesting, i thought US banks weren't allowed to offer bank accounts in currencies different than USD?

 

[Outlander]

This is interesting, i thought US banks weren't allowed to offer bank accounts in currencies different than USD?

I'm no expert in bank regulations but based on the fact that I do have a multicurrency account in the continental US, I'm pretty sure this is not the case.

Hint: think of local branches of international banks.

 

[jlf]

T

Without goint too deep into which bank, the process took months (final approval by the board hit a long queue) but was rather simple. My Registered Agent introduced me to the bank manager, I explained my business model and source of funds, then I filled a thousand forms, signed a thousand papers, and mailed everything back to the manager.

The EIN was taken care of by my manager after the account was already open. No state registration was required.

I got both a personal and a corporate account, in USD and EUR, and (good) credit cards. Yes, I used the address in Paraguay but the cards were mailed to a very different location.

I know at least two banks in the US which will open accounts on a case by case basis to IBCs, but don't expect to make a $5k deposit and forget about it. You're a high risk customer and they want to profit from you.

Though these are medium banks and service sometimes isn't top notch, it serves me extremely well.

Thanks for the quick reply. Very informative indeed. I am in the process of opening the US account for my BVI Ltd company. Acceptance has been surprisingly positive initially, but I do have personal accounts in one of the banks and want to bring along a good chunk of my brokerage account portfolio as well. Given everything is legal and I don't need the privacy factor, seems that they are willing to analyze things if you have a sponsor/introducer and a reputable history.

 

[Marzio]

The ID was mailed about 4 months later to my hideout in Asia

I've read that you need to visit Paraguay at least once every 3 years to be considered tax resident, is that correct?

 

[Outlander]

I've read that you need to visit Paraguay at least once every 3 years to be considered tax resident, is that correct?

You must not be entirely absent from the country for a whole 3 years in order to keep your resident status. In practice this law isn't enforced.

Tax residency is a whole different beast, check out prior discussions. Regardless of an official tax resident status which will require spending 6 months per year in Paraguay, the address and ID itself are of great value, especially if you need a "centre of vital interests" to avoid being taxed in your country of citizenship.