Ecuador — Impuesto a la Renta, IESS, IVA, Impuesto Sociedades 2026
💰 Impuesto a la Renta (Empleados)
Ecuador personal income tax with 10 progressive brackets (0%-37%). Ecuador uses US Dollars (USD) as its currency since 2000. IESS social security contributions (9.45%) are deductible. Calculated on 13+ monthly salaries (13th bonus mandatory).
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📌 Impuesto a la Renta 2026:
10 progressive brackets: 0% / 5% / 10% / 12% / 15% / 20% / 25% / 30% / 35% / 37%. Basic tax-free allowance: ~$12,081 (5× basic salary). IESS contributions (9.45%) fully deductible. Additional deductions: spouse ($1,708), children ($432 each), mortgage interest, medical expenses, education (20% credit), charitable donations. 13th salary (Décima): Mandatory Christmas bonus equal to one month's salary. 14th salary: School bonus at start of academic year. Non-residents: Flat 25% on Ecuadorian-source income. Ecuador is dollarized — all amounts in USD since adopting the US dollar in September 2000, replacing the sucre.
📊 Ecuador Tax Rates Overview 2026
Tax Type
Rate
Details
Renta (Exempt)
0%
Up to ~$12,081/yr
Renta (Lowest)
5%
$12,082 – $15,387
Renta (Lower-mid)
10%
$15,388 – $19,682
Renta (Mid)
12%
$19,683 – $26,031
Renta (Upper-mid)
15%
$26,032 – $34,255
Renta (High)
20%
$34,256 – $45,407
Renta (Higher)
25%
$45,408 – $60,450
Renta (Top-mid)
30%
$60,451 – $80,605
Renta (Top)
35%
$80,606 – $107,199
Renta (Maximum)
37%
Over $107,200
IESS Employee
9.45%
Social security
IESS Employer
12.15%
Social security
IVA (Standard)
15%
Most goods & services
IVA (Zero)
0%
Basic food, medicine, books
Corporate (General)
25%
Standard rate
Corporate (Residents)
22%
Resident-owned companies
Corporate (Tax haven)
28%
Non-resident in tax haven
Profit Sharing
15%
Mandatory to employees
ISD (Outflow tax)
5%
Foreign currency transfers
Municipal Assets
0.15%
On total net assets
📌 Dollarized Economy:
Ecuador adopted the US dollar as its official currency in September 2000, replacing the sucre at a rate of 25,000 sucres per dollar. This was a response to the worst banking crisis in Ecuador's history, which saw inflation peak at 96% and the sucre lose 67% of its value. Ecuador does not have its own central bank monetary policy — the Federal Reserve of the United States effectively sets monetary policy. This means no exchange rate risk for calculations, but also no independent monetary policy tools. All tax thresholds, salaries, and transactions are denominated in USD.
👥 IESS Calculator (Seguridad Social)
Ecuadorian social security via IESS (Instituto Ecuatoriano de Seguridad Social). Employee: 9.45%. Employer: 12.15%. Self-employed: 21.6% (full rate). Covers pension, healthcare, occupational risks.
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📌 IESS 2026:Employee (9.45%): Pension fund 9.45% (includes health coverage). Employer (12.15%): Pension 9.15% + Occupational risk fund 2.05% + Health 0.95%. Self-employed (21.6%): Must pay both employee and employer portions. Voluntary higher contribution: Some workers voluntarily contribute at 17.6% to receive higher pensions and more comprehensive healthcare. Décimo tercer sueldo (13th salary): Mandatory Christmas bonus — one full monthly salary, paid in December. Décimo cuarto sueldo (14th salary): School bonus — one monthly salary paid at start of academic year (August for Sierra, January for Costa). Utilidades: 15% of pre-tax profits distributed to employees (capped at 120 days salary). Vacaciones: 15 working days per year + 1 extra day per additional year of service.
🧾 IVA Calculator (Impuesto al Valor Agregado)
Ecuadorian VAT standard rate: 15%. Reduced/zero rates apply to basic food, medicine, books, and essential services. Plus selective consumption tax (ICE) on luxury goods.
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📌 IVA 2026:15% (Standard): Most goods & services, electronics, clothing, restaurants, alcohol, air travel. 0% (Exempt): Basic unprocessed food (rice, corn, beans, potatoes, milk, eggs), medicine, books/newspapers, diapers & menstrual products, residential rent, utilities, education, personal ground transportation. ICE (Impuesto a Consumos Especiales): Additional excise tax on alcohol (50-100%), tobacco (200-600%), vehicles (5-35%), firearms, luxury goods. ISD (Impuesto a la Salida de Divisas): 5% tax on money transfers abroad and foreign currency transactions. Designed to discourage capital flight.
🏢 Impuesto a la Renta de Sociedades (Corporate Tax)
Corporate income tax: 22% (resident-owned), 25% (general), 28% (tax haven shareholders). Plus mandatory 15% profit sharing to employees.
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🏠 ISD + Municipal Taxes
Impuesto a la Salida de Divisas (ISD): 5% on foreign transfers. Municipal assets tax: 0.15% on net assets. Property tax: 0.025%-0.5%.
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📌 Corporate & Other Tax Notes:ISD (5%): Impuesto a la Salida de Divisas — tax on money transfers abroad, foreign currency payments, and payments outside Ecuadorian banking system. Reintroduced at 5% in April 2024 (was temporarily reduced to 2-3.5%). Municipal assets tax (0.15%): Applied to total net assets of companies and individuals required to keep accounting records. Property tax: 0.025% to 0.5% of property value — among lowest in Latin America. Capital gains: Generally taxed at income rates. Equity/stock sales: 10%. Real estate: 10% (exempt if held 20+ years for personal use). Stock market gains: exempt if held 180+ days. New investment incentive: 3-5% reduced corporate tax rate for qualifying new investments.