Purchase Deeds in Dominican Republic
Foreigners can buy real estate in the country and are subject to the same requirements as Dominicans. Although buying in your own name is simple it is best to surround yourself with competent people to avoid any disappointments.
We will be at your side to guide and advise you throughout all your transactions.
The formalities entailed in purchasing real estate are practically identical, whether you purchase in your own name or through a local company, except of course setting up the company beforehand.
Purchasing in your own name
First of all an attorney prepares a “Promise of Sale” between the parties with a 10% down payment of the total sales price. Usually around 2 or 3 months later, the time your attorney needs to gather the various documents and see to formalities, (namely, verify the validity of the title deed or cadastre, verify that taxes are up to date, verify free and clear title, etc.) you sign the final deed of sale. The title deed is then issued in your name against payment of the balance of the transaction. The "sales contract" is signed and legalized by a notary. If you cannot be there on the day to sign the final purchase deed, you can appoint your lawyer to do so on your behalf.
All deeds are written in Spanish, which is the official language.
Buying property in the name of a company, three options:
- › Private Limited Liability Company (EIRL) with only one individual person and no minimum capital required.
- › Limited Liability Company (SRL) with at least two partners and a required minimum social capital equivalent to $2,400.
- › Public Limited Company (SA) with at least three board members and a required minimum social capital equivalent to $650,000.
The Code Napoleon applies in the country but with some slight changes. Taxes exist but are modest:
- › when the property is transferred to your own name costs vary between 4% and 6% of the tax value of the property, including the fees of the lawyer / notary in charge of the formalities, whereas with a company they vary according to the amount of your company capital.
- › then, there is an annual property tax called IPI which depends on the tax value of the property. Properties valued at under $150,000 are exempt. Above that, you will pay 1% of the tax value exceeding $150,000
Other important points (regardless of the legal form):
- › inheritance tax is very low,
- › no tax or banking link with your country of origin,
- › no capital gains tax in the Samana Peninsula, unlike the rest of the country,
- › no tax statement required in the country for your rental income.