What are the Company Accounting and Tax Requirements in Guatemala?

Whether looking for new investment opportunities in a country different from your own or planning to move your business to a new market, one of the first factors to consider is the foreign accounting and tax system. For those interested in expanding their business to Guatemala, companies or interested parties must understand all the accounting and tax requirements needed to operate.  

To support your company incorporation and ongoing operations in Guatemala, be aware of and comply with the following accounting and tax requirements.

Accounting regulations in Guatemala

Guatemala flag
Be sure to have a full understanding of accounting and tax requirements in Guatemala. You may consider outsourcing this responsibility to ensure compliance.

In January 2009, Guatemala adopted the International Financial Reporting Standards (IFRS) accounting regulations. However, it took the country a few years for its local professionals to receive the necessary training to apply them. Currently, the use of these standards is mandatory and generally known.

International Financial Reporting Standards have a wide range of general and specific regulations for the labor industry, different lines of business, and possible operating risks, among other aspects. It is important to promptly identify the rules applicable to the business in which you want to invest, so they may be taken into account at the moment you must present your financial statements.

This review must be carried out directly by the accounting/financial team in charge, together with the investor or, in the case of companies that are expanding, its main executives.

Requirements for tax in Guatemala

When making the decision to enter or expand into Guatemala, it is important to be aware of its unique tax system.

The Guatemala Tax Administration (SAT РSuperintendencia de Administración Tributaria) is the regulatory body in charge of collecting taxes generated/paid by individuals and companies nationwide.

Companies in Guatemala need to declare direct and indirect taxes to the SAT. The main ones are the value added tax and the income tax, which must usually be declared every month.

Income tax

This is a tax on the income or profits obtained by individuals and companies that are either national or foreign entities/assets, and whether they are Guatemalan residents or not. It is regulated by Decree 10-2012 and is applicable every time taxable income is produced.

Value added tax (VAT)

This is the tax that generates the most money for the State. It is paid by every person who buys a good or acquires a service. Decree 27-92 regulates this tax. The VAT rate is 12% of the value of each product or service and is always included in the prices of everything bought in Guatemala. Taxpayers registered in the General Regime are required to report monthly VAT paid on their purchases and VAT collected on their sales.

For a list of all the main taxes in Guatemala that vary according to the different needs and lines of business, you can visit the official page of the Guatemala Tax Administration.

Build your business in Guatemala with Biz Latin Hub

Before moving your business to Guatemala, be sure to determine the specific accounting, finance and tax requirements to ensure proper compliance. The professionals you work with during this process must be duly trained to perform the work necessary in a foreign environment.

For this reason, most foreign investors find themselves in need of hiring a local provider of professional accounting and tax services for their company. 

In Guatemala, our Biz Latin Hub team has personnel trained in all areas related to the implementation of new businesses in different industries. We are ready to assist your company formation, hiring, commercial representation, accounting and other legal needs to ensure you can begin operations as quickly as possible and in full compliance with local regulations. 

Reach out to our team today for personalized assistance.

Learn more about our team and expert authors.

Infographic: Biz Latin Hub services, including tax and accounting in Guatemala

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