Employer of record in Paraguay: costs and rules
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Paraguay adds 16.5% to an employee's total salary in the employer's IPS social insurance contribution, and the worker pays another 9%, according to the Ministry of Labor, Employment and Social Security (MTESS); the monthly EOR fee on top runs from $199 (Payoneer Workforce Management, formerly Skuad) to $699 (Oyster) (list prices, October 2026). The error to avoid is trusting a 0% table: Remote's Paraguay page shows IPS at 0% for both employer and employee and lists notice as one day.
An employer of record in Paraguay is a Paraguayan company that employs your hire, declares their salary to the Instituto de Previsión Social (IPS) each month, pays the employer contribution and runs payroll, while you assign the work.
- Minimum annual leave
- 12 working days (1 to 5…
- Currency
- PYG
On this page
Paraguay's employment rules in brief
IPS covers health, pensions and work risk in one contribution. The employer declares each worker's monthly salary and pays 16.5% of the total; 9% is deducted from the worker's pay. The MTESS guide's own example uses the 2025 minimum wage of PYG 2,899,048: the employer pays PYG 478,343 and the worker PYG 260,914.
- Minimum wage: PYG 3,044,000 a month from July 1, 2026, per Remote's country page, 5% above the 2025 figure set by Decreto 4122 of June 27, 2025. At that floor the employer's IPS is PYG 502,260 a month.
- Vacation (per Remote): 12 working days for 1 to 5 years of service, 18 for 5 to 10 and 30 after 10.
- Probation (per Remote): 30 days for unskilled and 60 days for skilled workers.
- Severance: on unjustified dismissal, 15 days' pay per year of service plus pay in lieu of notice if notice was not given, per Remote citing Labor Code art. 91.
- Payroll runs monthly.
We have not yet confirmed from official text Paraguay's year-end bonus (aguinaldo), the Labor Code notice scale, the work week or the public holiday count. Ask your EOR to put each one in the contract, and check with the MTESS.
Employment costs and rules in Paraguay
| Item | Paraguay |
|---|---|
| Employer social contributions | 16.5% IPS (confirmed: MTESS social security guide for private-sector employees, Oct 2025 edition) |
| What the employer pays | IPS social insurance (health, pension, work risk) employer 16.5% of total salary (MTESS guide, Oct 2025) |
| Caps and ceilings | No ceiling; floor is the minimum wage (unconfirmed today) |
| Employee contributions | 9% IPS (MTESS guide, Oct 2025) |
| Minimum wage | PYG 3,044,000 per month from July 1 2026 (secondary: remote.com; mtess.gov.py could not be read) |
| Mandatory bonuses | Aguinaldo: 1/12 of total annual pay, paid by Dec 31 (Labor Code art. 243, unconfirmed today) |
| Annual leave | 12 working days (1 to 5 years), 18 (5 to 10 years), 30 (over 10 years) (secondary: remote.com) |
| Probation | 30 days for unskilled workers, 60 days for skilled workers (secondary: remote.com) |
| Notice period | 30 days (up to 1 year), 45 days (1 to 5 years), 60 days (5 to 10 years), 90 days (over 10 years) (Labor Code art. 87, unconfirmed today) |
| Severance | Unjustified dismissal: 15 days' pay per year of service (secondary: remote.com, citing Labor Code art. 91), plus pay in lieu of notice if not given |
| Payroll frequency | Monthly |
| Sample salary used | PYG 292,000,000 per year (PYG 24,333,333 per month); exchange rate not confirmed today, chosen at roughly 7,300 PYG per USD |
Checked October 17, 2026. Source type: official (MTESS guide, Oct 2025) for IPS rates; secondary (remote.com) for minimum wage, leave, probation and severance. Sources are listed at the end of this page.
What an EOR charges to employ someone in Paraguay
| Provider | EOR fee per employee per month | Deposit | Entity model (provider claim) |
|---|---|---|---|
| Payoneer Workforce Management | from $199 | None listed | Claims owned entities across APAC, MEA, Europe and the Americas |
| Pebl | $399 | Not listed | About 90% of employees on Pebl-owned entities |
| Playroll | from $399 | One month's salary per employee, refundable | No clear owned-entity claim |
| Rivermate | $319 to $639 | Not stated | Claims 38 owned entities |
| Multiplier | $459 (annual) or $499 (monthly) | Sized from costs, fees and notice period (method published, no fixed amount) | Claims owned entities in 160+ countries |
| Rippling EOR | Quote only (third-party reference: $499) | Not listed | Claims Rippling entities; no partner mention |
| Deel | $599 | Not stated by Deel | Claims owned entities in 130+ countries |
| Remote | from $599 | Waived for startups; otherwise not stated | Claims 100% owned entities in 90+ countries |
| Atlas | from $599 | Not published | Claims owned entities in 160+ countries |
| Papaya Global | from $650 | Refundable deposit, amount not stated | Uses in-country partners |
| Oyster | $699 | At least one month of total service cost, refundable (per its terms) | Owned entities and partners |
| Globalization Partners (G-P) | Quote only | Not stated | Information page claims 100+ wholly owned entities |
Source: each provider’s pricing page, checked October 16, 2026. Fees are the provider’s charge on top of salary and the employer contributions above. Some providers adjust prices by country.
One Paraguayan employee, costed
No official guaraní exchange rate was confirmed for this page, so the example runs in dollars. Because IPS is a flat share of total pay with no ceiling we could find, the percentages hold at any salary.
| Line | Share of salary | Per year (USD equivalent) |
|---|---|---|
| Gross salary, paid in guaraníes | $40,000.00 | |
| IPS employer contribution | 16.5% | $6,600.00 |
| Year-end bonus (aguinaldo) | Not yet confirmed | Not yet confirmed |
| Employer cost before the EOR fee (confirmed) | $46,600.00 | |
| EOR fee at $599 a month | $7,188.00 | |
| Confirmed all-in cost | $53,788.00 |
Source: MTESS, Guía de Seguridad Social para trabajadores asalariados del sector privado (Oct 2025 edition), read Oct 17, 2026. Fee: $599 a month as listed by Deel and Remote on Oct 16, 2026. Amounts are in USD because we have not confirmed a guaraní exchange rate. Checked Oct 2026.
Arithmetic: 16.5% x 40,000 = 6,600. Add the fee of $599 x 12 = $7,188 and the confirmed total is $53,788 a year. At $199 a month the fee is $2,388, at $399 $4,788 and at $699 $8,388. The aguinaldo is not in this figure yet; if your EOR includes one, its quote should show it as its own line. Run other numbers in the international cost calculator.
Ending a Paraguayan contract
Severance on an unjustified dismissal is 15 days' pay for each year worked, according to Remote's summary of Labor Code art. 91 (a secondary source). After 4 years that is 60 days' pay, plus pay in lieu of any notice not given. Remote's "one day" notice entry should not be used to plan an exit. Ask the EOR what notice it will give and how its deposit covers severance.
Own entity or EOR in Paraguay
Running a Paraguayan company means IPS registration, monthly salary declarations and local payroll. For a first hire the $7,188 annual EOR fee usually beats that overhead. Use our EOR or entity comparison when headcount grows.
Paying contractors in Paraguay
Contractors skip the 16.5% IPS charge, which makes the model tempting. If the work has fixed hours, one client and your managers in charge, it may be treated as employment and the IPS contributions become due. See contractor management platforms or a contractor of record.
Choosing your Paraguay EOR
Whichever provider you pick, ask to see IPS at 16.5% as a line in the quote. Remote's own country data shows 0%, so check what its calculator produces before signing. On our scores Multiplier is first (79/100) and Oyster second (64/100); here is how we score.
The EOR ranking has the full list. Our Remote, Deel and Oyster reviews cover contracts and deposits, and the cost index compares Paraguay with Uruguay and Argentina.
Frequently asked questions
What does an employer of record in Paraguay cost?
What are the IPS contribution rates in Paraguay?
What is the minimum wage in Paraguay in 2026?
What severance applies in Paraguay?
Why does Remote show 0% IPS for Paraguay?
Sources (9)
- MTESS (Ministerio de Trabajo, Empleo y Seguridad Social): Guía de Seguridad Social para trabajadores asalariados del sector privado (checked Oct 17, 2026)
- Remote: Paraguay country explorer (checked Oct 16, 2026)
- Pebl: Pebl EOR pricing (checked Oct 16, 2026)
- Playroll: Playroll pricing (checked Oct 16, 2026)
- Multiplier: Multiplier pricing (checked Oct 16, 2026)
- Deel: Deel pricing (checked Oct 16, 2026)
- Remote: Remote pricing (checked Oct 16, 2026)
- Oyster: Oyster pricing (checked Oct 16, 2026)
- Payoneer Workforce Management (formerly Skuad): Skuad pricing (checked Oct 16, 2026)
This page is general information, not tax, legal or accounting advice. Rules and rates change, so check the official source linked above before you file or sign a contract. Read our disclaimer.