Tax System in the Dominican Republic: Income, Corporate, VAT & More
Dominican Republic Tax Overview (2024)
Residents taxed on worldwide income; non-residents on DR-source income. Currency: Dominican Peso (DOP).
💰 Personal Income Tax (ISR) – Progressive
| Annual Taxable Income (DOP) | Rate |
|---|
| 0 – 416,220 | 15% |
| 416,221 – 624,329 | 20% |
| 624,330 – 832,438 | 25% |
| Over 832,438 | 25% (on excess) |
Monthly exemption: ~DOP 34,685. Deductions: social security, mortgage interest (up to DOP 100k), education, donations.
🏢 Corporate Tax (IR-2)
- Standard Rate: 27% on net taxable income.
- Free Zones: 0% for 15–20 yrs (Law 8-90).
- Advance Payments: 1.5% monthly on gross income (creditable).
🛒 VAT (ITBIS) – 18% Standard
| Rate | Applies To |
|---|
| 18% | Most goods/services |
| 16% | Some services (telecom, insurance) |
| 0% | Exports, basic foods, medicines, education, health, finance |
| Exempt | Land, used residential rent, public transport |
⛽ Selective Consumption Tax (ISC)
- Alcohol, tobacco, firearms, vehicles, fuel, luxury goods – rates vary (10–100%+).
🏠 Property Taxes
- IPI (Annual): 1% on cadastral value > DOP 7.5M (primary residence exempt up to that).
- Transfer Tax (3%): On deed value at sale.
📋 Compliance
- Tax ID: RNC (Registro Nacional de Contribuyentes).
- Filing: Monthly (ITBIS), Annual (ISR/IR-2) via DGII portal.
- Withholding: Salaries (employer), professional fees (10%), dividends (10%), interest (10%).
Tip: Hire a local contador (CPA). Rules change; penalties steep.
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