El Salvador imposes penalties for late filing of returns, late payment, and incorrect returns or fraud.

The penalties are based upon the tax amount due as follows:

• 5% if delinquent less than 1 month;
• 10% if delinquent between 1 and 2 months;
• 15% if delinquent between 2 and 3 months; and
• 50% if over 3 months.

The annual interest rate on late tax payments during the period from 1 February 2023 up to 31 July 2023 is 6.35% which can be increased to 10.35% in case the delay in payment of tax is beyond 60 days following the expiration of the due date for the tax obligation.