Guide to Property Taxes in Dominican Republic

Nonresidents are generally subject to Dominican Republic income tax on income from Dominican sources. Married individuals are generally assessed separately.

Income Tax

For 2026, resident or domiciled individuals are subject to the following progressive individual income tax schedule:

Rental Income Tax

Rental income from real estate situated in the Dominican Republic constitutes Dominican-source income.

Where rent is paid to a nonresident who is not fiscally domiciled in the Dominican Republic, the applicable nonresident withholding rules must be considered. Dominican-source payments made abroad to nonresidents are generally subject to 27% income tax withholding, subject to the particular nature of the payment and applicable rules.

By comparison, where a Dominican company or other withholding agent pays rent to an individual under the ordinary domestic rental withholding regime, a 15% withholding applies.

CONFOTUR Tax Incentives

The Dominican Republic offers substantial tax incentives for qualifying tourism developments under Law No. 158-01 (CONFOTUR). For qualifying properties and activities covered by the project's CONFOTUR approval, these incentives can significantly reduce the tax burden on a foreign property investor.

The principal benefits can include:

• 0% Income Tax (ISR) on income derived from the qualifying incentivized activity, including qualifying rental activity.
• 0% Real Estate Transfer Tax on the qualifying first acquisition.
• 0% Property Tax (IPI) during the applicable exemption period.
• Other exemptions applicable to the approved tourism project, including specified taxes relating to construction, equipment and establishment of the development.

The fiscal exemption period is generally 15 years, calculated from the date on which construction and equipping of the approved project are completed.

Capital Gains Tax

A nonresident foreign individual disposing of real estate in the Dominican Republic may be subject to Dominican capital gains tax.

For a foreign individual, the applicable capital gains tax rate is generally 27% of the taxable capital gain under the current regime.

The taxable gain is not simply the property's selling price. It is generally determined by comparing the disposal value with the property's qualifying acquisition cost or adjusted tax basis under the applicable capital-gains rules.

Special compliance and withholding procedures apply where the seller is a foreign nonresident. The relevant Dominican party or purchaser may be required to act as withholding agent for the tax generated by the transaction.

Corporate Tax

Companies operating in the Dominican Republic are generally subject to Corporate Income Tax (ISR) at 27% of taxable income. Rental income and taxable capital gains earned by a company are generally included in its taxable income, while qualifying expenses incurred in generating that income may be deducted when calculating taxable profit.

For fiscal years 2026, 2027 and 2028, companies with annual gross income of at least DOP 1 billion are subject to a temporarily increased corporate income tax rate of 30%.

Buying and Selling Costs/Taxes

Property Holding Tax

The Dominican Republic imposes an annual Impuesto al Patrimonio Inmobiliario (IPI) on real estate owned by individuals.

For 2026, the tax is levied at 1% on the portion of the individual's total taxable real estate holdings exceeding DOP 10,695,494. The exemption threshold is adjusted annually for inflation.

The tax is based on the value of the property determined by the Dominican tax authority (DGII) for tax purposes. Where an individual owns several taxable properties, their values are generally aggregated when determining whether the DOP 10,695,494 threshold has been exceeded.