Quick summary: ISR is Guatemala’s income tax (Decreto 10-2012); IVA is its 12% value added tax (Decreto 27-92), always included in the price (Art. 10). Employees pay ISR at 5% up to Q300,000 of taxable income and Q15,000 + 7% above (Art. 73), after deductions of up to Q48,000 + Q12,000 (Art. 72). Businesses choose between 25% of taxable income (Art. 36) and 5% / 7% of monthly income (Art. 44). Small sellers under Q500,285 in 2026 can use the pequeño contribuyente regime: 5% of gross income, and no ISR (IVA law Arts. 47 and 49).
Checked on 24 September 2026 against the texts SAT publishes of Decreto 10-2012 and Decreto 27-92, and SAT’s FAQ on Decreto 31-2024. SAT’s consolidated IVA text still shows the old Q150,000 pequeño contribuyente ceiling; the Q500,285 figure is SAT’s own FAQ answer for 2026.
Side by side
| ISR (income tax) | IVA (value added tax) | |
|---|---|---|
| Law | Decreto 10-2012, Book I | Decreto 27-92 |
| What triggers it | Income | Sales of goods, services, imports, leases and other acts in Art. 3 |
| Main rate | Employees: 5% / Q15,000 + 7% (Art. 73); businesses: 25% (Art. 36) or 5% / 7% (Art. 44) | 12%, included in the price (Art. 10) |
| Small-seller option | Replaced by the pequeño contribuyente 5% (IVA law Art. 49) | Pequeño contribuyente: 5% of gross monthly income (Art. 47) |
| Who pays it to SAT | The employer withholds from wages (Art. 75); businesses file and pay | The seller, in a monthly return filed in the month after each period (Art. 40) |
| Personal deduction | Up to Q60,000 for employees (Art. 72 a) | None; employees can deduct up to Q12,000 of IVA paid from their ISR income (Art. 72 a) |
ISR for employees
Taxable income is annual income minus the Article 72 deductions:
- Up to Q60,000: Q48,000 of personal expenses with no receipts, plus up to Q12,000 of IVA paid on personal purchases, proved with a list of invoices (planilla de IVA) filed with SAT in the first ten business days of January.
- Donations that can be proved, with a cap of 5% of gross income for donations to non-profits, churches and similar bodies.
- IGSS contributions and other state social-security contributions.
- Life insurance premiums that cover only the worker’s death and pay no return or surrender value.
Then Article 73 applies: 5% up to Q300,000 of taxable income; Q15,000 + 7% of the excess above Q300,000. The employer withholds it (Art. 75). An employee files an annual return only if the employer did not withhold or withheld too little (Art. 81).
Example: Q10,000 a month = Q120,000 a year. Taking off only the Q48,000 leaves Q72,000; 5% of that is Q3,600 a year (Q300 a month). IGSS contributions and the IVA list lower it further. For the 2026 figures with every deduction, use the ISR calculator.
ISR for businesses and freelancers
| Regime | Rate | How it is paid |
|---|---|---|
| Régimen Sobre las Utilidades de Actividades Lucrativas | 25% of taxable income (Art. 36) | Quarterly payments (Art. 38) and an annual return in the first three months of the year (Art. 39) |
| Régimen Opcional Simplificado Sobre Ingresos | 5% of monthly taxable income up to Q30,000; Q1,500 + 7% of the excess (Art. 44) | Mainly through withholding by the customers who pay you (Art. 46) |
| Pequeño contribuyente (IVA law) | 5% of gross monthly income (Art. 47) | Withheld by IVA withholding agents as a final payment, or paid with a simplified monthly return (Art. 48); no ISR (Art. 49) |
To move between regimes, see changing your tax regime.
IVA in practice
- Price includes it. Article 10 requires the 12% to be included in the sale price. A Q112 price is Q100 plus Q12 of IVA.
- Monthly return. Sellers declare all the month’s operations, exempt ones included, within the following calendar month, and pay with the return (Art. 40). Filing steps: monthly IVA return.
- Imports. The base is the CIF price plus customs duties and other import charges (Art. 13).
- Exemptions. Article 7 lists the general exemptions; they include exports and certain sales in municipal markets, among others.
The pequeño contribuyente regime
- Ceiling: 125 non-agricultural monthly minimum wages, without the bonificación incentivo: Q500,285 for 2026, per SAT’s FAQ on Decreto 31-2024 (in force since 9 April 2025). Before that reform the ceiling was Q150,000.
- Rate: 5% of gross income each calendar month (Art. 47).
- Paperwork: only the purchases and sales book authorized by SAT; an invoice for every sale over Q50, with smaller sales consolidated into one invoice at the end of the day (Art. 49).
- ISR: relieved of paying and filing annual, quarterly or monthly ISR (Art. 49).
- For the buyer: a pequeño contribuyente invoice gives no IVA tax credit (Art. 49).
- Going over the ceiling: based on the previous calendar year, you must ask to join the general regime, or SAT can move you (Art. 50).
More detail: pequeño contribuyente in Guatemala.
Related
- ISR calculator for employees
- Annual ISR return
- Monthly IVA return
- Pequeño contribuyente regime
- Getting a NIT
- Booking a SAT appointment
- US taxes when working remotely from Guatemala
General information on Guatemala’s tax laws, not tax advice. For your own case, talk to a Guatemalan contador público.