Countries › Dominican Republic › Guide › 6. Taxes › Permanent establishments and branches in the Dominican Republic: when a foreign company is taxed and how

Permanent establishments and branches in the Dominican Republic: when a foreign company is taxed and how

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Last verified: 2026-10-30 · Status: Stable

A 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. The establishment pays the corporate rate on income attributable to it and withholds 10% on remittances to head office. It keeps separate books, and agents are jointly liable.

USD figures use the Banco Central de la República Dominicana reference selling rate of RD$60.8594 per US dollar for 28 October 2026, the latest row in its published rate file on the verification date, rounded to the cent.

Key facts

Consulting creating a permanent establishment	More than 6 months in an annual period ruleLey 11-92 art. 270 paragraph II, as of 2026-10-30 · in force
Branch remittance	10 %Ley 11-92 art. 308 paragraph II, as of 2026-10-30 · in force

The rule

1. A permanent establishment is a fixed place of business such as a management seat, office, branch, agency, factory, workshop, mine or well. It also covers assembly projects and supervision, construction or supervision from a machinery sale when its cost exceeds 10% of the sale price, business consulting exceeding six months in an annual period, and dependent agents or independent agents acting almost wholly for the company.Ley 11-92, Código Tributario, art. 270 paragraph II, 2012-11-09 official text · verified 2026-10-30

2. Non residents with an establishment pay on all income attributable to it under the rules for companies, without becoming residents.Ley 11-92, Código Tributario, art. 270 paragraph I, 2012-11-09 official text · verified 2026-10-30

3. Establishments remit to head office subject to the 10% dividend withholding.
Example: Remittance RD$5,000,000: withholding RD$500,000. / Remittance US$82,156.58: withholding US$8,215.66.Ley 11-92, Código Tributario, art. 308 paragraph II, 2012-11-09 official text · verified 2026-10-30

4. Branches keep separate accounts from head office and related companies. If the books are insufficient, DGII can treat local and foreign entities as an economic unit.Ley 11-92, Código Tributario, art. 279 and art. 280, 1992-05-16 official text · verified 2026-10-30

5. Local agents or representatives of foreign companies are jointly liable for tax and must file and withhold.Ley 11-92, Código Tributario, art. 282, 1992-05-16 official text · verified 2026-10-30

6. Under the Spain treaty, a provider with an establishment is taxed on business profits instead of the 10% services cap.Spain treaty, art. 13 paragraph 2, 2014-07-25 official text · verified 2026-10-30

Point	Branch or establishment	No establishment
Tax	27% on net income	Withholding on each gross payment
Remittance	10%	Not applicable
Books	Separate accounts	None
ITBIS	Taxpayer if making taxable supplies	Depends on the supply

Branch or no establishment

Worked example

A branch with net income of RD$10,000,000 (about US$164,313.15) pays RD$2,700,000 (about US$44,364.55) and remits the rest, paying RD$730,000 (about US$11,994.86) on the remittance. The total burden is 34.3%, equal to a subsidiary paying a dividend.

Step by step

Count consulting time in each annual period.
Check agent authority.
Register the branch and get an RNC.
Keep separate books.
Withhold 10% on each remittance.

Common traps

Six months of consulting in an annual period creates an establishment, so project timing matters.
A distributor acting almost wholly for one company can create an establishment.
Reimbursed head office charges still face transfer pricing and the necessity test.

Sources

Related: Dominican Republic country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide

← Tax treaties of the Dominican Republic: Canada and Spain only, with rate table and how to claim reliefAnnual property tax in the Dominican Republic (IPI): 1% above RD$10,695,494 in 2026 →

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