Capital Gains Tax in El Salvador

The rules

• Net capital gains are taxed at 10%.
• Gains on assets sold within 12 months of acquisition are taxed as ordinary income. For securities the 12-month rule does not apply.
• Capital losses can only be set against capital gains. Unused losses carry forward for five years.

Source: Income Tax Law, consolidated to Official Gazette No. 79 of 30 April 2025 (General Directorate of Customs, PDF, in Spanish); PwC Worldwide Tax Summaries: El Salvador, other taxes^1,2

Real estate

A separate 3% transfer tax applies when real estate changes hands, on the part of the value above USD 28,571.43. A seller’s gain is taxed under the capital gains rules above.²

Exemptions

• Gains from digital assets issued under the Digital Assets Issuance Law are exempt from all taxes, as long as the conditions of that law are met.
• Beneficiaries of the Law for the Promotion of Technological and Manufacturing Innovation can be exempt from capital gains tax on their benefited activities for 15 years.
• Gains on foreign assets fall outside income tax since the March 2024 reform on foreign-source income.

Source: PwC Worldwide Tax Summaries: El Salvador, tax credits and incentives; Legislative Assembly: Decree No. 969 of 12 March 2024 (PDF, in Spanish)^3,4