Incorporating In The Dr

I set up two. One was 1000- bux US the Other was 1200 bux US for the same thing. Don't know why other than one attorney wants more for the same work than another.

Scott

If I had that info I would have included it. I use the corps to purchase property with and don't turn a profit so I don't have a clue as to tax ramification or non profit status.

Non Profit has been discussed previously so do a search and see what you can come up with. I don't recollect what the answers were but I do have a feeling that some sort of NP status is available.

Compared to the US it IS a lot of money for the incorporation. I am not familiar with other places.

Scott

Fees and expenses for incorporations depend on the capitalization involved (a 100,000 pesos corporation costs less than a 10,000,000 pesos corporation) and on whether the incorporation includes a "contribution in kind" (conveying an asset to the corporation, for example, real estate, without paying transfer taxes). $1000 to $1200 is the standard cost for a low-capitalization company without a "contribution a kind".

The process involved is more complicated than in the US. For example, our archaic company law still requires 7 shareholders. Law firms usually provide nominees to fulfill this requirement.

The corporate tax rate is a flat 25% on net income.

Nonprofit corporations do exist. The incorporation requirements and procedure are totally different from for-profit corporations.

Fabio, if the tax rate is at 25% of net income in the DR, who determines the net income - me or the DR Gobierno, and does this number follow GAAP allowing for depreciation, etc, or does "Net Income " to a DGII functionario mean whatever ends up in the till?

Also, does the "prepayment rate" of 1.5% of revenue ( I think that this applies to any business that has revenue over RD$600,000 per year right?) apply against this liability for corporate income taxes, and if so, when does this need to be paid - is it monthly, quarterly , annually, or what?

Thank you for your guidance and answers.

Article 287 of the Tax Code (Law #11-92) lists deductible expenses and depreciation schedules.

The 1.5% is applicable to companies with more than RD$6,000,000 in gross revenues, is payable monthly (1.5/12) and is credited against the total corporate income tax due.

But what is the time schedule?

In many countries you can incorporate a company in 2-3 days. I was told it lasts months in the DR?

Barnab?

BTW, an other question: What are the taxes due if you rent commercial premises? Is it true there is a 20% tax apart from VAT?

Thank you

philly, you need to get into correspondence, or come down for a visit with a few people that trade out of free zones. Your questions are too many, and too involved to get into on this board.

Quickly -
1. you do not need DR citizenship or residency.
2. yes it is possible to set up a corporation in a free zone (read the fine print -- what do you want to accomplish?)
3. what if it is technology based? - No problem.
4. not very agressive unless they catch you. bribes are not really a problem once you learn where to pay for 'good services' and where not.
5. incentives - this is a big topic. Tax free trading for many years and other incentives.

Free Zones fall into a different category from that which Fabio discusses in this thread. If your interest is serious, you could write me an e-mail and I'll tell you what I know. There are a few of us here that do technology business and there is a free zone in Santo Domingo that is a 'technology' zone.