Payroll Services in Guatemala
Fully managed Guatemalan payroll – IGSS, IRTRA and INTECAP paid every month, income tax withheld with the 2026 extraordinary deduction, and the aguinaldo and Bono 14 calculated to the day, with a named specialist a phone call away.
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What Guatemalan payroll actually involves
Guatemalan payroll pays fourteen salaries a year plus a monthly incentive bonus, sends 12.67% of salary to three institutions through one IGSS payroll, and withholds income tax on an annual projection. A reform in May 2026 changed the income tax deductions halfway through the year.
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Calculate Your Employee Costs in Guatemala
Enter a gross annual salary, meaning twelve monthly ordinary salaries, to see the employer cost of a Guatemalan employee: 10.67% IGSS, 1% IRTRA and 1% INTECAP, the aguinaldo and Bono 14, and the Q250 monthly incentive bonus. Severance for dismissal without cause is not included.
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*Indicative figures only and not definitive legal advice. Local regulations change frequently. Consult an expertGuatemala
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Employer Costs in Guatemala Explained
A Guatemalan employee costs about 30% to 36% on top of twelve monthly salaries. The aguinaldo and Bono 14 add 16.7%, contributions to the IGSS, IRTRA and INTECAP add 12.67%, and the Q250 incentive bonus adds a fixed Q3,000 a year, which weighs most on lower salaries. There is no contribution ceiling, so the share barely falls as salaries rise. Severance of a month’s salary per year of service is a further liability on dismissal without cause. Here’s the breakdown.
The Guatemalan Social Security Institute (IGSS) charges 10.67% to the employer and 4.83% to the employee: 4% and 2% for sickness and maternity, 3% and 1% for accidents, and 3.67% and 1.83% for disability, old age and survivors’ pensions. Employers also pay 1% to IRTRA, the workers’ recreation institute, and 1% to INTECAP, the technical training institute, for 12.67% in total. There is no ceiling. The aguinaldo, Bono 14, incentive bonus and severance are outside the contribution base.
Every employer with three or more workers must register with the IGSS, and each payroll is declared on the IGSS electronic payroll and paid monthly. Employees covered by the IGSS receive two thirds of their salary from it while unable to work because of illness or accident, and their full salary during maternity leave.
For an employee on Q8,000 a month, the employer pays Q1,013.60 a month to the IGSS, IRTRA and INTECAP and the Q250 incentive bonus, and sets aside Q1,333.33 a month for the aguinaldo and Bono 14: Q10,596.93 a month in total, 32.5% on top of the salary. At the non-agricultural minimum wage in Guatemala department, Q4,002.28, the fixed bonus lifts the share to 35.6%.
Severance is the other liability to budget for. On dismissal without cause after the probation period, the employee receives a month’s salary per year of service, calculated on the average salary of the last six months plus a proportional share of the aguinaldo and Bono 14, with no cap.
Employment income is taxed at 5% on annual taxable income up to Q300,000; above that, the tax is Q15,000 plus 7% of the excess. Employees deduct Q48,000 a year without receipts, up to Q12,000 of VAT paid on personal purchases, their IGSS contributions, life insurance premiums and donations. The aguinaldo and Bono 14 are exempt up to a month’s ordinary salary each, and severance is exempt.
Decree 13-2026, published in May 2026, added an extraordinary deduction of Q3,024 for the 2026 tax year. Employers recalculated each employee’s annual projection and spread the change over the remaining monthly withholdings, which takes employees on the minimum wage out of income tax. From January 2027 the Q48,000 deduction becomes twelve times the highest monthly non-agricultural minimum wage, incentive bonus included, updated every year. Employers withhold a twelfth of the projected annual tax each month and pay it to the SAT within the first ten business days of the following month.
The 2026 minimum wages were set by Government Agreement 256-2025, published on 22 December 2025. In Guatemala department, the first economic zone, they are Q4,002.28 a month for non-agricultural work, Q3,791.20 for agriculture and Q3,409.73 for export and maquila. In the rest of the country they are Q3,816.90, Q3,625.89 and Q3,221.10. The increases were 7.5%, 5.5% and 4%. Every employee also receives the Q250 monthly incentive bonus.
The aguinaldo equals a month of ordinary salary for a year of service, paid 50% in the first half of December and 50% in the second half of January, or in full in December. The Bono 14 equals the average monthly ordinary salary of the year ending in June and is paid in the first half of July. Both are pro-rated for shorter service and paid on termination.
The day shift is up to 8 hours a day and 48 a week; outside agriculture and employers with fewer than ten workers, 45 hours of effective work a week are paid as 48. Overtime carries a 50% premium, and ordinary and overtime hours together cannot exceed 12 a day. Employees have at least 15 working days of paid vacation after each year of service, the public holidays set by the Labour Code, and paid leave of two days on the birth of a child, five on marriage and three on the death of a close relative. Maternity leave is 84 days, 30 before and 54 after birth, on full salary.
The first two months of an indefinite contract are probation. After that, an employee who resigns gives one week’s to one month’s notice, depending on service. An employer that dismisses without proven cause pays severance of a month’s salary per year of service and, if a court finds against it, lost wages of up to twelve months. At least 90% of an employer’s workers must be Guatemalan and receive at least 85% of total salaries, and every employer files an annual report on its workforce and pay with the Ministry of Labour in the first two months of the year.
Guatemalan employer contributions and payroll costs, 2026
| Contribution | Employer | Employee | Applies to |
|---|---|---|---|
| IGSS sickness and maternity | 4% | 2% | Ordinary salary, no ceiling |
| IGSS accidents | 3% | 1% | Same base |
| IGSS disability, old age and survivors | 3.67% | 1.83% | Same base |
| IRTRA recreation levy | 1% | — | Same base |
| INTECAP training levy | 1% | — | Same base |
| Incentive bonus | Q250 a month | — | Every employee, outside the contribution base |
| Aguinaldo and Bono 14 | One month each | — | December and January; July |
| Income tax (ISR) | — | 5% / 7% | 7% on taxable income above Q300,000 |
Income tax withheld at selected salaries, 2026
| Monthly salary | Annual taxable income | Tax a year | Tax a month | Effective rate |
|---|---|---|---|---|
| Q4,002.28 | Q0 | Q0 | Q0 | 0.00% |
| Q8,000 | Q40,339.20 | Q2,016.96 | Q168.08 | 2.10% |
| Q15,000 | Q120,282 | Q6,014.10 | Q501.18 | 3.34% |
| Q30,000 | Q291,588 | Q14,579.40 | Q1,214.95 | 4.05% |
| Q60,000 | Q634,200 | Q38,394 | Q3,199.50 | 5.33% |
Employer cost by monthly salary, 2026
| Monthly salary | Contributions a year | Aguinaldo and Bono 14 | Incentive bonus | Total a year | Share of twelve salaries |
|---|---|---|---|---|---|
| Q4,002.28 | Q6,085.07 | Q8,004.56 | Q3,000 | Q17,089.63 | 35.58% |
| Q8,000 | Q12,163.20 | Q16,000 | Q3,000 | Q31,163.20 | 32.46% |
| Q15,000 | Q22,806 | Q30,000 | Q3,000 | Q55,806 | 31.00% |
| Q30,000 | Q45,612 | Q60,000 | Q3,000 | Q108,612 | 30.17% |
| Q60,000 | Q91,224 | Q120,000 | Q3,000 | Q214,224 | 29.75% |
Taxable income is twelve monthly salaries less the Q48,000 and Q3,024 deductions and IGSS contributions, without the VAT credit or the incentive bonus; the aguinaldo and Bono 14 are within their exemption. Employer costs are on top of twelve salaries: 12.67% contributions, the aguinaldo and Bono 14, and the incentive bonus. Q4,002.28 is the 2026 non-agricultural minimum wage in Guatemala department. These are TopSource calculations from the verified 2026 rates.
Rates, deductions and statutory amounts shown are for 2026 and were verified on 29 September 2026 against IGSS and Ministry of Labour sources and the published legislation. Minimum wages are set every December, and the income tax deduction changes again in January 2027. This page is general information, not tax or legal advice.
How our Guatemalan payroll service works
Why Outsource Your Guatemalan Payroll to TopSource
TopSource for payroll, Employer of Record or any other of our services represents a simpler, more reliable and transparent option.
We don’t hide fees or sneak price increases. We run Guatemalan payroll in-house and file under your own IGSS and SAT registrations rather than a bureau’s, so the same team that files your IGSS payroll answers your calls. You get a named account manager, one consolidated monthly invoice covering salaries, contributions, taxes and fees, and one live Portico view of Guatemala beside every other country we run for you. Portico syncs with your time-tracking, leave and HR systems via API – set up by our onboarding team, not left to yours. GDPR, SOC 2 and ISO 27001 certified.
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Guatemalan payroll FAQs
Employers pay 12.67% of ordinary salary: 10.67% to the IGSS for sickness and maternity, accidents and pensions, 1% to IRTRA and 1% to INTECAP. Employees pay 4.83% to the IGSS. There is no ceiling, and the aguinaldo, Bono 14 and Q250 incentive bonus are outside the base.
Under Government Agreement 256-2025 it depends on the activity and the economic zone. In Guatemala department it is Q4,002.28 a month for non-agricultural work, Q3,791.20 for agriculture and Q3,409.73 for export and maquila; in the rest of the country Q3,816.90, Q3,625.89 and Q3,221.10. The Q250 incentive bonus is paid on top.
The aguinaldo equals a month of ordinary salary for a full year of service, pro-rated for shorter service. Half is paid in the first half of December and half in the second half of January, unless the employer pays it all in December. It is exempt from income tax up to a month’s salary and paid proportionally on termination.
Bono 14 is an annual bonus equal to a month of ordinary salary, based on the average of the year ending in June and paid in the first half of July under Decree 42-92. It is separate from the aguinaldo, pro-rated for shorter service and on termination, and exempt from income tax up to a month’s salary.
Every private-sector employee receives an incentive bonus of at least Q250 a month on top of salary. It is outside the base for IGSS, IRTRA and INTECAP contributions and does not count towards the aguinaldo, Bono 14, vacation pay or severance.
Annual taxable income is taxed at 5% up to Q300,000, and at Q15,000 plus 7% of the excess above that. Employees deduct Q48,000 without receipts, up to Q12,000 of VAT paid on personal purchases and their IGSS contributions, plus an extra Q3,024 for 2026 under Decree 13-2026. Employers withhold a twelfth of the projected annual tax each month.
IGSS, IRTRA and INTECAP contributions are declared on the IGSS electronic payroll and paid monthly. Income tax withheld from salaries is paid to the SAT within the first ten business days of the following month. The aguinaldo is due in December and January, Bono 14 in the first half of July, and the annual employer report by the end of February.
An employee dismissed without cause after probation receives a month’s salary per year of service, pro-rated for part years, based on the average salary of the last six months plus a proportional share of the aguinaldo and Bono 14. There is no cap. If the employer cannot prove a dismissal for cause, it also owes lost wages of up to twelve months.
Employees are entitled to at least 15 working days of paid vacation after each year of continuous service with the same employer. They also have the paid public holidays set by the Labour Code, and paid leave of two days on the birth of a child, five on marriage and three on the death of a close relative.
Registering as an employer with the IGSS and as a withholding agent with the SAT requires a Guatemalan legal presence, which in practice means a local company or branch. Without one, the usual route is an Employer of Record. TopSource can run payroll for your Guatemalan entity or employ your team through our Employer of Record service.
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