ITBIS tax on employees?

[botemon]

Here is the scenario and if you are running a business here in the DR, I would love to hear from you! On a side note I am waiting to hear from a DR tax accountant about this question….but as all things go…..who knows how long I will be waiting! (SARC). Question: If I have a “registered business” in the DR, and hire Dominicans (engineering types), income taxes along with all the other requirements like pensions, health, x-mas bonus, severance, etc. are to be paid by the “employer”. The law reads, as I understand it, that ITBIS tax (18%) is paid on “goods AND services”. Does this apply to employees? The income tax rate for the folks hired will be 25% because the Income exceeds the maximum income tax rate. Does anyone know if an additional ITBIS tax is added to this either by the employee of the employer? Make sense? Thanks for your thoughts!

 

[Manuel01]

IT DOES NOT ! No itbis on salarys.

 

[Northern Coast Diver]

Here is the scenario and if you are running a business here in the DR, I would love to hear from you! On a side note I am waiting to hear from a DR tax accountant about this question….but as all things go…..who knows how long I will be waiting! (SARC). Question: If I have a “registered business” in the DR, and hire Dominicans (engineering types), income taxes along with all the other requirements like pensions, health, x-mas bonus, severance, etc. are to be paid by the “employer”. The law reads, as I understand it, that ITBIS tax (18%) is paid on “goods AND services”. Does this apply to employees? The income tax rate for the folks hired will be 25% because the Income exceeds the maximum income tax rate. Does anyone know if an additional ITBIS tax is added to this either by the employee of the employer? Make sense? Thanks for your thoughts!

ITBIS is only paid on goods and services your business sells not on salaries. Income tax(Known here as"impuesto sobre la renta"}, is only collected on the part of the salary which is over the maximum tax free limit. Employers deduct 2.83% and 3.04% from each paycheck for Health insurance and Pension in addition to Impuesto Sobre la Renta.

 

[Manuel01]

ITBIS is only paid on goods and services your business sells not on salaries. Income tax(Known here as"impuesto sobre la renta"}, is only collected on the part of the salary which is over the maximum tax free limit. Employers deduct 2.83% and 3.04% from each paycheck for Health insurance and Pension in addition to Impuesto Sobre la Renta.

It looks like "Nortern Coast Diver" knows more than your Accountant. And i am not even joking. The list of businesses that went broke because of an incompetent accountant is miles long.

 

[M4kintosh]

Here is the scenario and if you are running a business here in the DR, I would love to hear from you! On a side note I am waiting to hear from a DR tax accountant about this question….but as all things go…..who knows how long I will be waiting! (SARC). Question: If I have a “registered business” in the DR, and hire Dominicans (engineering types), income taxes along with all the other requirements like pensions, health, x-mas bonus, severance, etc. are to be paid by the “employer”. The law reads, as I understand it, that ITBIS tax (18%) is paid on “goods AND services”. Does this apply to employees? The income tax rate for the folks hired will be 25% because the Income exceeds the maximum income tax rate. Does anyone know if an additional ITBIS tax is added to this either by the employee of the employer? Make sense? Thanks for your thoughts!

ITBIS is only on goods and services, nationwide, no exception.
ISR is for salaries that only applies to those who earn above 35,000 pesos a month, nationwide, no exception.

Use DGII online calculator on what you should retain to your employees. Oh, and get advice from an accountant

Calculadora de retenciones

 

[botemon]

Thank you! I think I have the answer ....before talking with the "accountant"!!!

 

[JD Jones]

I know of companies here that pay their management less than 35K, and pay extra to a dollar account in a stateside bank for them.