ISR Withholding from Suppliers Guatemala 2026: 7% Rate, When to Apply and How to File

ISR withholding from suppliers is an obligation for General Regime companies at SAT: deducting 5% or 7% of ISR when paying suppliers and remitting it to the treasury monthly. It’s an advance collection mechanism that prevents evasion in B2B operations.

Quick summary ISR withholding: Applies to General Regime companies paying services to suppliers. Rate 7% (general) or 5%/7% (supplier’s simplified regime). Withholding certificate in FEL. Monthly return SAT-1311 before the 10th. Penalty for omission: 100% of tax plus interest.

What Is ISR Withholding from Suppliers?

ISR withholding from suppliers is the mechanism by which a company paying services to another person or entity deducts a portion of the supplier’s ISR at the time of payment and remits it directly to SAT on behalf of the supplier. This system:

• Advances the collection of the supplier’s ISR (the supplier credits it on their annual return)
• Reduces evasion in B2B operations where without withholding some operations would go untaxed
• Makes the payer jointly liable for the tax — if you don’t withhold, you must pay the omitted ISR yourself
• Applies only to payments for services and rents — not to purchases of goods invoiced with regular VAT

The supplier receives an electronic withholding certificate that they use to credit against their annual ISR. If accumulated withholdings during the year exceed their owed ISR, they have a recoverable credit balance.

Learn more about the General ISR regime →

Who Must Withhold?

Important: If you pay a Small Contributor supplier, their Factura Especial already includes 5% — but you must still withhold 7% additional on the operation’s base value per Art. 39 Decree 10-2012, unless the supplier demonstrates exemption via RTU.

Withholding Rates

This guide focuses on 7% withholding to national General Regime suppliers — the most common case in B2B operations.

How to Apply Withholding Step by Step

Step 1: Verify the Supplier’s Regime

Before the first payment:

1. Ask the supplier for a photocopy of RTU or current SAT certificate
2. Verify the registered regime:
   • General ISR Regime (5%-7% on gross income or 25% on profits) → consult exact rate per their specific regime
   • Optional Simplified Regime (5%-7%) → yes, withhold
   • Small Contributor → yes, withhold 7%
   • Exempt (NGO, international organization, etc.) → request exemption certificate, no withholding
3. If RTU not shown, withhold 7% by default (don’t assume exemption)

Step 2: Calculate and Apply at Payment

1. Receive the supplier’s invoice (regular Factura Electronica or Factura Especial)
2. Calculate the base amount (without VAT if invoice discriminates)
3. Calculate withholding = base amount × 7%
4. Subtract withholding from payment to supplier
5. Pay the supplier the net (invoice amount minus withholding)
6. Issue electronic withholding certificate (FEL) and deliver copy to supplier

Calculation example:

Step 3: Accumulate the Month’s Withholdings

During the month:

1. Keep records of each withholding: date, supplier NIT, amount paid, withheld
2. Keep FEL certificates issued
3. Reconcile with your accounting monthly

Step 4: Declare and Pay SAT

Before the 10th of the following month:

1. Enter SAT Agencia Virtual
2. Select Form SAT-1311 “ISR Withholding Sworn Declaration”
3. Detail each withholding: NIT, name, base, withheld (system allows bulk CSV upload)
4. Confirm total to pay
5. Pay online via Declaraguate (BI, Banrural, BAM, BG)
6. Save payment receipt and declaration number

Cost and Time

Penalties for Not Withholding

As a withholding agent, you’re jointly liable for unwithheld ISR. Penalties are heavy:

1. Payment of unwithheld ISR (7% of supplier payment) with default interest
2. 100% fine of omitted tax (Tax Code)
3. Rejection of expense deductibility on your annual ISR (you lose the tax shield)
4. Possible fraud classification if omission is systematic
5. Fiscal solvency block

If you discover you didn’t withhold on past operations, regularize voluntarily with amended return before audit — SAT accepts payment with fewer penalties than when they detect it.

FEL Withholding Certificate

Since 2023, the withholding certificate is issued electronically via FEL as an Electronic Tax Document (DTE) type “ISR Withholding Certificate”:

• The FEL system automatically links it with the supplier’s invoice
• The supplier receives it by email at the moment of issuance
• It’s registered at SAT for audit and automatic cross-check
• No additional cost to the issuer
• Replaces the old paper certificates

To issue it:

1. Enter your FEL system (SAT-FEL or private certifier)
2. Create DTE type “ISR Withholding Certificate”
3. Link to supplier’s invoice (NIT, amount, date)
4. Indicate rate and amount withheld
5. Sign electronically and send

Special Cases

Partial Payments

If you pay the invoice in parts (advance + final payment), you withhold 7% from each partial payment. The FEL certificate is issued per payment, not for the complete invoice.

Diaspora Suppliers

If you pay a Guatemalan consultant residing in the US with active NIT, withholding applies normally. If the consultant is non-resident for tax purposes (formal residence outside GT over 183 days/year), the non-resident regime applies (differentiated rate Book II Decree 10-2012, generally 5%-25%).

Mixed Payments (Goods + Services)

If the invoice combines goods (no withholding) and services (withholding), you must break it down:

• Goods with 12% VAT: no withholding (VAT collects what’s needed)
• Services with 12% VAT: 7% withholding on services base

Ask the supplier for separate invoices by item when possible — it simplifies calculation.

Exempt Supplier

If the supplier demonstrates exemption (NGO with SAT certificate, international organization, embassy), you don’t withhold. Always request the current exemption certificate (renewed annually) and file it with the invoice.

Frequently Asked Questions

“My supplier is a Small Contributor. Should I withhold?”

Technically yes, 7%. In practice many companies don’t withhold from Small Contributors because their Factura Especial already includes 5% and double-payment administration creates friction. However, the correct legal position is to withhold — SAT can observe the expense if you didn’t apply withholding correctly.

“What if the supplier refuses to accept withholding?”

The supplier cannot refuse — it’s law. If the contract doesn’t mention withholding, you must still apply it because it’s a Tax Code obligation. The right approach is to inform before the first operation: “Due to our company regime we’re required to withhold 7% from your payment. We provide a certificate so you can credit it on your annual ISR.”

“I have NIT but operate as a final consumer. Should I withhold when contracting a professional?”

No. ISR withholding obligation to suppliers applies only to companies (individuals or legal entities) registered in General ISR Regime paying services. An individual paying for personal services doesn’t act as a withholding agent.

“I forgot to withhold last month. Can I correct it?”

Yes. File an amended SAT-1311 form for the corresponding month with the omitted withholdings, pay the unwithheld ISR (with interest but before audit, reduced fines apply), and issue the corresponding FEL certificates with current date.

“The supplier claims the withholding was too high. How do I verify?”

Check three things: (1) correct calculation base (must exclude VAT), (2) correct rate (5% for simplified regime first Q30K, 7% on excess or general regime), (3) you didn’t apply double withholding on the same operation. If you find an error, issue FEL Credit Note for the certificate and issue a new correct one.

Practical Tips

1. Configure your accounting system to automatically calculate and issue withholding when registering payment. Reduces errors and filing time.
2. Request RTU from every new supplier before the first payment — avoids errors and disputes.
3. Reconcile FEL certificates with SAT-1311 declaration each month — the total must match.
4. Keep certificates 4 years — SAT can audit.
5. If you have few recurring suppliers, group payments to issue fewer certificates and simplify filing.
6. Consider hiring external accountant if your monthly volume exceeds 50 withholdings — tax error risk scales rapidly.
7. Call 1550 or use Agencia Virtual chat for questions during filing.

Official Links

• SAT — Agencia Virtual
• SAT — Form SAT-1311 ISR Withholding
• SAT Information Line: 1550

Related SAT Procedures

• Annual ISR Tax Return — where the supplier credits withholdings
• Electronic Invoicing FEL — source of the invoice that triggers withholding
• Changing Tax Regime — affects applicable withholding rate
• CUI-NIT Lookup — verify supplier’s regime
• Salary Calculator — for ISR on employment income (different)