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6. Taxes: Dominican Republic

Taxes in the Dominican Republic: corporate income tax at 27% with a temporary 30% rate for the largest companies, the asset tax, ITBIS at 18%, selective taxes, withholding on dividends, interest, royalties and services, transfer pricing, thin capitalization, losses, treaties with Canada and Spain, payroll and property taxes, incentives, disputes and the changes made by Ley 30-26 of June 2026, each tied to the official text. Where Argentina is involved, the Argentine side is covered in The Argentine Thread guide.

Investor view. Lower withholding on royalties and software, the end of taxes on incorporation and property operations, and predictable appeal rules make the Dominican system easier to invest in, and the 30% rate on the largest companies is set to end after 2028.

• Tax system of the Dominican Republic: who collects what, the main rates in 2026 and what Ley 30-26 changedThe Código Tributario (Ley 11-92) sets income tax, ITBIS (the value added tax), selective consumption taxes and the asset tax, collected by DGII, while Aduanas collects at the border. Companies pay 27
• Corporate income tax in the Dominican Republic: 27%, the temporary 30% rate, returns and foreign incomeCompanies and most other entities pay 27% on net taxable income under art. 297, and those with income from RD$1,000 million pay 30% for fiscal years 2026 to 2028. Residents are taxed on Dominican inco
• Asset tax in the Dominican Republic: 1% of taxable assets, credited against income taxThe asset tax is an annual 1% on the balance sheet assets of companies and sole proprietors, working as a minimum tax because income tax paid is credited against it. Banks, power companies and some fi
• Dividend withholding in the Dominican Republic: 10% final, the dividend account and a US$100 exampleCompanies withhold a final 10% on dividends to resident or non resident shareholders, and the tax is not creditable by a Dominican individual. A Dominican parent excludes dividends received and can pa
• Interest paid abroad from the Dominican Republic: 10% withholding and the deduction limit most people missInterest paid to non residents carries a final 10% withholding, and the same 10% applies to interest paid to resident individuals. The payer's deduction is then limited to 10/27 of the interest unless
• Royalties, software licences, online advertising and data storage paid abroad: the 15% rate since 1 July 2026Since 1 July 2026, royalties and rights paid abroad carry a final 15% on the gross amount, down from the general 27%, under new art. 305-1. Software licences, online advertising and data storage or ri
• Withholding on other payments abroad: 27% on gross, presumed income rules and technical assistancePayments of Dominican source income to non residents that have no special rule carry a final withholding at the art. 297 rate, 27%, on the gross amount. Ley 30-26 now treats technical assistance used
• Domestic withholding in the Dominican Republic: new 15% rates on rent and services since 1 July 2026Companies and sole proprietors withhold on rent, fees and other payments to individuals, and Ley 30-26 raised most of those rates from 10% to 15% from 1 July 2026. Rent paid to individuals is now a fi
• Income tax advance payments in the Dominican Republic: monthly today, new tiers from 2027Companies today pay twelve monthly advances, set at 1.5% of prior year gross income if their effective rate was 1.5% or less, or one twelfth of last year's tax otherwise. From fiscal year 2027 that ru
• ITBIS, the Dominican value added tax: 18%, 16% on listed goods, zero rated exports and monthly filingITBIS is charged at 18% on the transfer of industrialized goods, imports and services, with a 16% rate on a short list of foods and zero on exports. Most financial, health, education, residential rent
• Selective consumption taxes in the Dominican Republic: alcohol, tobacco, vapes, telecoms, insurance and fuelsSelective taxes fall on alcohol, tobacco, listed luxury goods, telecoms at 10%, insurance at 16% and fuels. Ley 30-26 added a 55% tax on vapes, fixed retail price as the alcohol and tobacco base, and
• Tax on checks and electronic transfers in the Dominican Republic: 0.2% since 3 July 2026A 0.2% tax falls on the value of checks paid by banks and on electronic transfer payments, up from 0.15%. Transfers between accounts of the same person are now outside the tax, as are card purchases,
• Transfer pricing in the Dominican Republic: arm's length rule, DIOR, local and master files and penaltiesArt. 281 applies the arm's length standard to dealings with foreign and resident related parties and with low tax jurisdictions, related or not. Taxpayers file an annual DIOR, and those above an infla
• Thin capitalization in the Dominican Republic: the 3 to 1 interest limit and three year carryforwardArt. 287 caps deductible interest at total interest multiplied by three times average equity over average interest bearing debt. Debts to residents who include the interest in income at the general ra
• Tax losses in the Dominican Republic: five years, 20% a year and profit caps in years four and fiveCompanies carry losses forward for five years, deducting 20% of the loss per year, with no chance to recover a slice not used in its year. In the fourth year the slice is limited to 80% of taxable inc
• Deductions and depreciation in the Dominican Republic: 5%, 25% and 15% categories and the coming accelerated regimeBusiness expenses are deductible if necessary to earn, keep and preserve income and if backed by valid fiscal receipts. Assets depreciate on a declining pool at 5%, 25% or 15%, and Ley 30-26 lets comp
• Capital gains in the Dominican Republic: 10% on real estate for individuals, 27% for companies and offshore share salesGains are the sale price less inflation adjusted cost. Since June 2026 individuals pay a final 10% on real estate gains, with reliefs for home reinvestment and sellers over 65, while companies include
• Tax treaties of the Dominican Republic: Canada and Spain only, with rate table and how to claim reliefDGII names two income tax treaties in force, with Canada and Spain, plus an information exchange agreement with the United States and the multilateral mutual assistance convention. There is no treaty
• Permanent establishments and branches in the Dominican Republic: when a foreign company is taxed and howA foreign company has a permanent establishment with a fixed place of business, and also through construction, assembly, consulting above six months in a year and dependent or some independent agents.
• Annual property tax in the Dominican Republic (IPI): 1% above RD$10,695,494 in 2026The Impuesto al Patrimonio Inmobiliario is a yearly 1% on real estate held by individuals above an inflation adjusted exemption, RD$10,695,494 for 2026, and on the full value held by trusts. The exemp
• Real estate transfer and registration taxes in the Dominican Republic: 3% transfer tax and the end of the 2% taxTransfers of real estate pay a unified 3% within six months of completing the deed, on the property value. A separate 2% on other real estate operations, such as mortgage registration, falls to 1% in
• Payroll taxes in the Dominican Republic: TSS rates, 2026 caps, INFOTEP and fringe benefit taxEmployers pay 7.09% for health, 7.10% for pensions, a risk premium of about 1.1% to 1.3% and 1% to INFOTEP, while workers pay 3.04% and 2.87%, up to capped salaries. The employer also withholds salary
• Personal income tax in the Dominican Republic: 2026 scale, the 2027 scale and foreign incomeResidents pay up to 25% in 2026 with RD$416,220 exempt, and from fiscal year 2027 the exempt band rises to RD$480,000 with a new top rate of 27% above RD$4.8 million. Residents are taxed on Dominican
• Local and smaller business taxes in the Dominican Republic: waste contribution, vehicles, municipal charges and exit feeThe national system does most of the work, and municipalities raise taxes, fees and arbitrios by ordinance under Ley 176-07. Since the 2025 close companies also pay a yearly solid waste contribution o
• Customs duties in the Dominican Republic: 0% to 20% tariff, ITBIS at the border and courier rulesImport duties run at 0%, 3%, 8%, 14% and 20% by tariff line, with higher rates for sensitive farm goods in the WTO rectification. ITBIS at 18% and any selective tax apply on top, on a base that includ
• Tax incentives in the Dominican Republic: regimes, terms and the new rule of one regime per activityMajor regimes cover free zones, tourism under Ley 158-01, the border zone under Ley 12-21, renewable energy, industry under Ley 392-07, international financial zones and pensioners. Since Ley 30-26, a
• Free zone taxation in the Dominican Republic: exempt exports, 3.5% on local sales and 5% for commercial zonesFree zone companies are 100% exempt from income tax on their regime, but pay a 3.5% tax on gross local sales. Commercial free zones under the older law pay 5% on gross sales. Moving goods into a zone
• Tax audits and disputes in the Dominican Republic: three year limit, 20 day appeal, tribunal and prompt paymentDGII has three years to assess, extended by suspensions, and since Ley 30-26 unpaid declared debts also suspend the period. Taxpayers have 20 days for reconsideration and then 30 days to go to the adm
• Tax penalties in the Dominican Republic: 3% monthly surcharge, 1.10% interest and the amnesty to 31 December 2026Since 1 July 2026 the late payment surcharge is 3% a month, capped at 100%, replacing 10% then 4%, and monthly interest stays at 1.10% until a new formula is reviewed in January 2027. Evasion can cost
• Digital services tax treatment in the Dominican Republic: 15% withholding, no ITBIS collection on foreign platformsThere is no digital services tax. Payments abroad for software licences, online advertising and data storage carry a 15% final withholding since July 2026 if a Dominican business pays. The 2025 decree
• Simplified tax regime (RST) in the Dominican Republic: new limits pending regulationLey 30-26 rewrote the RST as a voluntary regime for income tax and ITBIS, based on income up to RD$30 million for final consumer sales, RD$15 million for professionals and farmers, or purchases up to
• Inheritance and gift tax in the Dominican Republic: 3% on estates, 27% on gifts and new exemptionsEstates pay 3% after deductions, and Ley 30-26 exempts those below RD$1 million, or RD$2 million for direct relatives. Gifts pay the corporate rate, 27%, unless below the personal exempt amount or to
• Electronic invoicing in the Dominican Republic: e-CF only from 1 November 2026 for large and medium taxpayersLey 32-23 moves taxpayers to electronic fiscal receipts (e-CF). Large local and medium taxpayers must issue only e-CF from 1 November 2026, and type B sequences lapse on 31 October. Small, micro and u
• Dominican tax calendar for a company: monthly, yearly and one off dates in 2026 and 2027Monthly filings fall on the 10th for withholding and the 20th for ITBIS. A December close means the IR-2 and first asset tax payment around 30 April, with the second asset tax payment around 30 Octobe

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