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El Salvador is a Central American nation using the US Dollar, known for Bitcoin adoption as legal tender, and offering digital nomad visas with tax incentives for foreign investors.
Region
CENTRAL AMERICA
Corporate Tax
30%
Setup Time
2 weeks
Currency
USD
El Salvador made global headlines as the first nation to adopt Bitcoin as legal tender, signaling an ambitious bet on cryptocurrency as a path to financial innovation. This small Central American nation combines that forward-thinking approach with the stability of US Dollar adoption and a growing ecosystem for digital nomads and tech entrepreneurs.
Life in El Salvador offers Pacific beaches, volcanic landscapes, and a tropical climate at costs far below North American equivalents. The country is geographically compact, making weekend exploration entirely feasible. Surf culture thrives along the coast, particularly around El Tunco and El Zonte.
The population of approximately 6.5 million is predominantly Spanish-speaking, with English increasingly common in business and tourist areas. Healthcare operates through both public and private systems, with private facilities offering quality care at prices below US equivalents.
Safety has been El Salvador's most significant challenge historically. Recent security measures have dramatically reduced violent crime rates, though visitors should stay informed about local conditions.
El Salvador's business environment blends Central American practicality with ambitious innovation. The corporate tax rate of 30% is offset by significant incentives through free trade zones and special economic areas.
The adoption of Bitcoin as legal tender positions El Salvador as a laboratory for cryptocurrency adoption. The dollarized economy provides stability uncommon in Central America, eliminating currency risk for USD-based operations.
The digital nomad visa program offers pathways for remote workers to establish legal residence.
Company formation requires minimum capital of USD 2,000. The most common vehicle is the Sociedad Anónima de Capital Variable (S.A. de C.V.). Registration typically completes within two weeks.
Foreign ownership is permitted at 100% in most sectors. Banking functions adequately for domestic operations, with Bitcoin integration adding options for certain transactions.
El Salvador's security situation, while improved, requires ongoing attention. The small domestic market of 6.5 million limits scale, though CAFTA-DR membership provides preferential access to US markets.
For entrepreneurs attracted to cryptocurrency opportunities, affordable tropical living, and dollar-denominated operations, El Salvador offers a distinctive proposition.
Local: S. de R.L.
Local: S.A. de C.V.
Local: Sucursal
| Corporate Tax Rate | 30% |
| Personal Income Tax Rate | 30% |
| VAT / Sales Tax | 13% |
| Capital Gains Tax | 10% |
| Withholding Tax | 25% |
| Reduced Corporate Tax Available | Yes |
| Non-Resident Withholding Exempt | Yes |
| Tax Treaty Network | No |
| Banking Access | MEDIUM |
| Financial Privacy | MEDIUM |
| Currency Controls | NONE |
| Local Bank Account Required | No |
| Non-Resident Bank Account Allowed | Yes |
| Physical Presence for Banking | No |
| Banks Restrictive (High Risk) | No |
| AML Officer Required | No |
| MLRO Required | No |
| Compliance Officer Required | No |
| Data Protection Officer Required | No |
| Bookkeeping Frequency | Annual |
| Local Bookkeeping Required | Yes |
| Mandatory Audit | Yes |
| License Required | Yes |
| Local Director Required | No |
| Local AML Director Required | No |
| Local Legal Address Required | Yes |
| Local Physical Office Required | No |
| Capital Maintained in Account | No |
| Compliance Program Required | Yes |
| Travel Rule Compliance | FATF guidelines via CNAD |
| Business Plan Required | Comprehensive business plan, technical documentation, AML/KYC procedures |
| Personnel Required | Compliance officer, cybersecurity personnel, qualified management |
| Insurance Required | No |
| Remote Incorporation Possible | Yes |
| 100% Foreign Ownership | Yes |
| Min. Shareholders | 1 |
| Min. Directors | 1 |
| Shareholder/Director Same Person | Yes |
| Registry Public | Yes |
| Registry Access | CNAD registry |
| Renewal Period | Annual |
| Accounting Filing Required | Yes |
| Accounting Filing Frequency | Annual |
| Financial Statement Required | Yes |
| Financial Statement Frequency | Annual |
| Accounting Audit Mandatory | No |
| Compliance Audit Mandatory | No |
| Technical Audit Mandatory | No |
| Corporate Income Tax Applicable | No |
| Dividend Tax Applicable | No |
| Capital Gains Tax Applicable | No |
| Territorial Tax Regime | No |
| VAT Applicable | Yes |
| Regulators | National Commission of Digital Assets (CNAD), Central Reserve Bank (for Bitcoin) |
| Licensing Fee Details | Minimum capital $2000; license processing 5-6 months |
| Permitted Business Models | Exchange, Custody, Token Issuance, DeFi, NFT, RWA, Stablecoin |
| Permitted Activities | Bitcoin services (BSP license), digital asset services (DASP license), exchange, custody, token issuance (utility/security/stablecoins) |
| Restricted Activities | Activities without CNAD authorization; digital sovereign money issuance reserved for central authorities |
| Cross-Border Service Allowed | Yes |
| Physical Inspection Required | No |
| Derivatives Allowed | No |
| RWA Tokenization Allowed | Yes |
| App Store Listing Allowed | Yes |
| Crypto Custody Allowed | Yes |
| License Required | Yes |
| Local Director Required | Yes |
| Local AML Director Required | No |
| Local Legal Address Required | Yes |
| Local Physical Office Required | Yes |
| Capital Maintained in Account | Yes |
| Compliance Program Required | Yes |
| Travel Rule Compliance | N/A |
| Business Plan Required | Business plan required |
| Personnel Required | Management team |
| Insurance Required | No |
| Remote Incorporation Possible | No |
| 100% Foreign Ownership | Yes |
| Min. Shareholders | 2 |
| Min. Directors | 1 |
| Shareholder/Director Same Person | Yes |
| Registry Public | Yes |
| Renewal Period | Annual |
| Accounting Filing Required | Yes |
| Accounting Filing Frequency | Annual |
| Financial Statement Required | Yes |
| Financial Statement Frequency | Annual |
| Accounting Audit Mandatory | Yes |
| Compliance Audit Mandatory | Yes |
| Technical Audit Mandatory | Yes |
| Corporate Income Tax Applicable | Yes |
| Dividend Tax Applicable | Yes |
| Capital Gains Tax Applicable | Yes |
| Territorial Tax Regime | No |
| VAT Applicable | Yes |
| Regulators | Gaming Commission or equivalent |
| Licensing Fee Details | Standard gambling licensing |
| Permitted Business Models | Casino, Sports Betting |
| Permitted Activities | Land-based and online gambling |
| Restricted Activities | Varies by jurisdiction |
| Cross-Border Service Allowed | No |
| Physical Inspection Required | Yes |
| Player Fund Segregation | Yes |
| B2B/B2C Separate Requirements | No |
| License Required | Yes |
| Local Director Required | Yes |
| Local AML Director Required | Yes |
| Local Legal Address Required | Yes |
| Local Physical Office Required | Yes |
| Capital Maintained in Account | Yes |
| Compliance Program Required | Yes |
| Travel Rule Compliance | FATF guidelines |
| Business Plan Required | Comprehensive business plan |
| Personnel Required | Qualified management, compliance officer |
| Insurance Required | Yes |
| Insurance Details | Professional indemnity required |
| Remote Incorporation Possible | No |
| 100% Foreign Ownership | Yes |
| Min. Shareholders | 2 |
| Min. Directors | 1 |
| Shareholder/Director Same Person | Yes |
| Registry Public | Yes |
| Registry Access | Central Bank registry |
| Renewal Period | Annual |
| Accounting Filing Required | Yes |
| Accounting Filing Frequency | Annual |
| Financial Statement Required | Yes |
| Financial Statement Frequency | Annual |
| Accounting Audit Mandatory | Yes |
| Compliance Audit Mandatory | Yes |
| Technical Audit Mandatory | No |
| Corporate Income Tax Applicable | Yes |
| Dividend Tax Applicable | Yes |
| Capital Gains Tax Applicable | Yes |
| Territorial Tax Regime | No |
| VAT Applicable | Yes |
| Regulators | Central Bank |
| Licensing Fee Details | Varies by license type |
| Permitted Business Models | Banking, EMI, Payment Services |
| Permitted Activities | Banking, payment services, lending |
| Restricted Activities | Deposit taking requires full banking license |
| Cross-Border Service Allowed | Yes |
| Physical Inspection Required | Yes |