El Salvador Loosens Temporary Residency Rules, Keeps 0% Tax on Foreign Income and Bitcoin Gains

El Salvador is continuing to fine-tune its immigration framework to draw wealthy foreign individuals and capital, including families, according to Mars Finance. Under Decree No. 531, taking effect March 31, 2026, the country will cut the minimum physical-presence requirement for temporary residents to 90 days per year, down from 9 months. The days may be accumulated or consecutive. The change is aimed at entrepreneurs, investors, and remote workers who need frequent cross-border mobility. On taxation, El Salvador promotes one of Latin America's more favorable setups for people earning abroad. It operates a territorial tax system, taxing only income generated within El Salvador. A 2024 income tax overhaul further clarified that both residents and non-residents are exempt from income tax on all foreign-sourced income. As a result, freelancers and remote workers—including content creators, developers, and entrepreneurs paid from overseas—can face a 0% Salvadoran income tax rate on foreign earnings, with no income cap. Salvadoran law also does not tax Bitcoin capital gains, and the country levies no wealth tax, inheritance tax, or gift tax. The practical constraint is enforcement by an individual's home country. Many jurisdictions do not readily give up taxing rights over their tax residents and often apply strict reviews and enforcement around tax-residency status.