Nicaragua Tax Rates
Nicaragua operates a territorial tax system administered by the Dirección General de Ingresos (DGI). Only Nicaraguan-source income is taxable. Personal income tax is progressive with a top rate of 30%, the corporate rate is 30%, and the VAT (IVA) rate is 15%. Nicaragua has free trade zones that offer significant tax incentives for export-oriented businesses.
Top Income Tax Rate
30%
Corporate Tax Rate
30%
VAT / Sales Tax
15%
Capital Gains Tax
10%
Detailed Tax Information
Income Tax Brackets
Nicaragua imposes a progressive personal income tax with five brackets from 0% to 30%. Only Nicaraguan-source income is taxable under the territorial system. The exempt amount is NIO 100,000 annually. Employment income is subject to monthly withholding.
| Income Range | Tax Rate |
|---|---|
| C$0 – C$100K | 0% |
| C$100K – C$200K | 15% |
| C$200K – C$350K | 20% |
| C$350K – C$500K | 25% |
| C$500K+ | 30% |
Corporate Tax
Nicaragua imposes a 30% corporate income tax on Nicaraguan-source income. An alternative minimum tax (minimum definitive payment) of 1-3% of gross income applies. Free zone companies are exempt from all national taxes for up to 10 years.
Standard Rate
30%
Capital Gains Tax
Capital gains in Nicaragua are taxed at a flat 10% rate. This applies to occasional gains from the sale of real estate, shares, and other assets.
Rate
10%
VAT / Sales Tax
Nicaragua levies a 15% IVA on most goods and services. Basic food items, medicines, exports, and educational services are exempt or zero-rated. A selective consumption tax (ISC) applies to alcohol, tobacco, and certain luxury goods.
Standard Rate
15%
Cryptocurrency Tax
Nicaragua does not have specific cryptocurrency legislation. The Central Bank has warned against virtual currency use. Under the territorial system, crypto gains would only be taxable if considered Nicaraguan-source.
Tax Treaties
Nicaragua has very limited tax treaty coverage, with Spain being the primary treaty partner. The country participates in some Central American tax cooperation frameworks.
Treaty Network
1
Double taxation agreements
Major treaty partners:
Key Details
Relocate to Nicaragua
See how much you could save by moving here from your current country.
+$17K
Tax in United States
$24K
24.4% effective
Tax in Nicaragua
$7K
7.0% effective
You Save
71.3%
less tax annually
US Citizens: Important Note
US citizens are taxed on worldwide income regardless of residence. You'll still need to file US taxes, though the Foreign Earned Income Exclusion and Foreign Tax Credit may reduce your liability.
