Countries › Dominican Republic › Guide › 6. Taxes › Royalties, software licences, online advertising and data storage paid abroad: the 15% rate since 1 July 2026

Royalties, software licences, online advertising and data storage paid abroad: the 15% rate since 1 July 2026

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

Since 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 right of use carry the same 15% under art. 305-2, and a true purchase of software ownership is outside it. The draft regulation and a pending DGII norm will draw the line between licence and purchase.

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

Royalty withholding, non residents	15 %Ley 11-92 art. 305-1, as of 2026-10-30 · in force
Software licence, online advertising and data storage withholding, non residents	15 %Ley 11-92 art. 305-2, as of 2026-10-30 · in force

The rule

1. Whoever pays or credits royalties or rights to non residents withholds 15% of the gross value as a sole and final payment.
Example: Royalty RD$2,000,000: withholding RD$300,000, previously RD$540,000 at 27%. / Saving of US$3,943.52 on this payment.Ley 11-92, Código Tributario, as amended by Ley 30-26, art. 305-1, 2026-06-18 official text · verified 2026-10-30 · changed: New article, in force 1 July 2026 under DGII notice 10-26. These payments previously fell under the general rate in art. 305.

2. Whoever pays or credits to non residents for software licences, online advertising services and right of use or storage of data withholds 15% of the gross value as a sole and final payment.Ley 11-92, Código Tributario, as amended by Ley 30-26, art. 305-2, 2026-06-18 official text · verified 2026-10-30 · changed: New article, in force 1 July 2026 under DGII notice 10-26.

3. Payments abroad to acquire software are outside the art. 305-2 withholding if there is an effective transfer of ownership by the developer or owner.Ley 11-92, Código Tributario, as amended by Ley 30-26, art. 305-2 paragraph, 2026-06-18 official text · verified 2026-10-30

4. Income from industrial property of any kind and from know how used in the country is Dominican source income.Ley 11-92, Código Tributario, art. 272 literal e, 1992-05-16 official text · verified 2026-10-30

5. No deduction is allowed for royalties if the required withholding was not paid.Ley 11-92, Código Tributario, art. 281 paragraph III literal b, 2012-11-09 official text · verified 2026-10-30

6. The Spain treaty caps royalties at 10% and its definition includes payments connected with information and equipment use. The Canada treaty caps royalties at 18%, and copyright payments on literary, dramatic, musical or artistic works are taxable only in the residence state if the recipient is taxed there.Spain treaty; Canada convention, art. 12; art. XII, 2014-07-25 official text · verified 2026-10-30

7. DRAFT, NOT IN FORCE. The draft regulation treats SaaS, activation keys and copies as licences, presumes licence for recurring or usage based payments, and treats periodic structures as licence unless proven otherwise. It requires a sale contract, a sworn statement from the developer or other evidence for the purchase carve out.Draft regulation of Ley 30-26, art. 20 to art. 22, 2026-10-30 official text · verified 2026-10-30

Payment	Before	Since 1 July 2026	Spain treaty cap
Royalties and rights	27%	15%	10%
Software licences	27%	15%	10% if within the royalty definition
Online advertising, data storage	27%	15%	Depends on characterization
Purchase of software ownership	General rules	Outside art. 305-2	Not relevant

Rate before and after 1 July 2026

Worked example

A Dominican SaaS customer pays a US vendor US$10,000 of subscription, or RD$608,594. It withholds 15%, RD$91,289.10 (about US$1,500.00). If the contract says the vendor gets US$10,000 net, the gross up makes the payment RD$715,992.94 (about US$11,764.71) and the withholding RD$107,398.94 (about US$1,764.71).

Step by step

Classify each foreign payment: royalty, licence, service or purchase.
Check the contract for a tax gross up clause.
Apply the treaty cap only with a tax residence certificate for that year.
Withhold and file on IR-17 by the 10th of the next month.
Watch the DGII norm on software, whose forum closed on 15 September 2026.

Common traps

DGII opened a draft norm on software in notice 11-26. No final norm appears in its list as of the verification date, so the licence and purchase line is still open.
Art. 297 paragraph I refers to articles 305 Bis and 305 Ter while the law numbers them 305-1 and 305-2. The draft regulation reads them as the same articles.
Treaty relief is claimed through the IR-17 annex, with case review by DGII. See the treaties page.
Software development services are technical assistance rather than a licence and may fall at the general rate.

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

← Interest paid abroad from the Dominican Republic: 10% withholding and the deduction limit most people missWithholding on other payments abroad: 27% on gross, presumed income rules and technical assistance →

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