El Salvador applies a progressive ISR (Impuesto Sobre la Renta) with rates from 0% to 30% on employment income. Annual income up to $6,600 is fully exempt. Above that: 10% on the next band up to $9,142.86, 20% on the band up to $22,857.14, and 30% on income above $22,857.14. Employee social contributions include AFP pension at 7.25% and ISSS health insurance at 3% (capped at $1,000/month salary, max $360/year) — for a combined maximum employee burden of about 10.25% (lower for higher earners due to the ISSS cap). A landmark 2024 law reform exempted foreign-source income from Salvadoran ISR, making El Salvador notably attractive for remote workers and digital entrepreneurs earning from abroad. El Salvador uses the US Dollar as its primary currency (dollarised since 2001) and became the first country to adopt Bitcoin as legal tender in 2021. San Salvador offers a cost of living of ~$700-1,000/month. The country is aggressively promoting itself as a business-friendly digital economy hub.
This hub links to every El Salvador tax guide and calculator on CountryTaxCalc — covering income tax rates, and tools to calculate your take-home pay.
El Salvador's income tax uses Progressive ISR: exempt up to $6,600/year; 10% on $6,600-$9,142.86; 20% on $9,142.86-$22,857.14; 30% above $22,857.14. Employee AFP pension 7.25% + ISSS health 3% (capped at $1,000/month salary). Uses USD. Bitcoin legal tender. Foreign income exempt since 2024 reform.. Use the calculator to estimate your take-home pay after income tax:
| Income | Rate |
|---|---|
| Annual income up to $6,600 | 0% (exempt) |
| $6,600.01 – $9,142.86/year | $212.12 + 10% on amount over $4,064 |
| $9,142.87 – $22,857.14/year | $720.00 + 20% on amount over $9,142.86 |
| Above $22,857.14/year | $3,462.86 + 30% on amount over $22,857.14 |
| Foreign-source income | 0% (exempt since 2024) |
| Employee AFP pension | 7.25% of gross salary |
| Employee ISSS health insurance | 3% of gross salary |
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