yet the title says: Solo 28,618 personas pagan el impuesto al patrimonio (only xxx people pay the tax). at the time the article was published only the first part of the tax would have been paid, due in march.
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Property Tax is coming to our neighborhood
yet the title says: Solo 28,618 personas pagan el impuesto al patrimonio (only xxx people pay the tax). at the time the article was published only the first part of the tax would have been paid, due in march.
Several years ago I posted on DR1 about the Real Estate consultants hired by the government to provide guidance as to valuing, categorizing and developing a plan to tax the then building boom taking place in the DR.
Those consultants (information through a contact) advised the government to begin in certain sectors of the cities of Santo Domingo and Santiago.....AND to look at the many developments concentrated in/near the beach/ocean.
While it has taken years to come into being, a concerted effort is now going forward to find, assess and tax real estate above the government exempted levels.
As word finally gets out that the taxes are now being enforced, a chilling effect is likely to take place on people looking to buy/build homes with a value greater than the government exemption and it will likely soften prices for those homes for sale above the exempted amount.
Respectfully,
Playacaribe2
Those consultants (information through a contact) advised the government to begin in certain sectors of the cities of Santo Domingo and Santiago.....AND to look at the many developments concentrated in/near the beach/ocean.
While it has taken years to come into being, a concerted effort is now going forward to find, assess and tax real estate above the government exempted levels.
As word finally gets out that the taxes are now being enforced, a chilling effect is likely to take place on people looking to buy/build homes with a value greater than the government exemption and it will likely soften prices for those homes for sale above the exempted amount.
Respectfully,
Playacaribe2
So based on the new evaluation minimum, approximately $200,000 CDN, I won't pay annual assessment tax if I purchase property up to $200,000. I'll just pay a 4% tax and legal transfer, deslinde fees when I purchase the property. This is what real estates agents are telling me. Is it correct? The comment about taxes in el campo is true based on the property owned by my two friends and widowed friend in Luperon. Houses are cheaper there but much more difficult to sell so what you gain on taxes you lose on resale value.
What you paid for the house is NOT the issue. It is what the government decides your house is worth. Also keep in mind that this tax is supposed to be assessed on the total value of all the properties you own in the DR.
If you are over 65 years of age and your name is on the title, you are probably exempt from this tax.
Thanks. All the real estate agents said houses are never assessed at fair market value for tax purposes. They are always assessed lower than purchase price. I'll be 67 in July. It's nice to know the aches and pains that come with that will probably exempt me from property taxes.
You might want to verify the exemptions BEFORE you buy. And, if you do buy a property above the exempted amount with such an exemption (over 65....if it exists), you will likely need to keep it in your own name....not a corporation....and that is a whole different discussion.
Respectfully,
Playacaribe2
there is something interesting here. i found few older threads about this:
http://dr1.com/forums/showthread.php/85455-DGII-IPI-or-IVSS-clarification-plz
http://dr1.com/forums/showthread.php/141315-Property-Taxes
http://dr1.com/forums/showthread.php/121337-Is-there-property-taxes-for-houses
http://dr1.com/forums/showthread.php/115377-Changing-From-Corporation-To-Private-Ownership
from this i gather that 1% tax was applied on the excess value of the house. so whatever amount above tax free amount.
the companies paid 1% tax on all assets.
i think this thread will be better off in legal section so that guzman ariza can address this and clarify the info.
http://dr1.com/forums/showthread.php/85455-DGII-IPI-or-IVSS-clarification-plz
http://dr1.com/forums/showthread.php/141315-Property-Taxes
http://dr1.com/forums/showthread.php/121337-Is-there-property-taxes-for-houses
http://dr1.com/forums/showthread.php/115377-Changing-From-Corporation-To-Private-Ownership
from this i gather that 1% tax was applied on the excess value of the house. so whatever amount above tax free amount.
the companies paid 1% tax on all assets.
i think this thread will be better off in legal section so that guzman ariza can address this and clarify the info.
Yes, most properties have been assessed well below market value. That might be changing.
I agree that it is likely that the property must be in the owner's name and not in a corporation to get an exemption for being 65 or older.
The benefits of home ownership in a corporation are not what they once were and this is potentially one more motivation to own privately.
Do diligence is in order so there are no surprises.
Quoting from a Fabio Guzman a post in 2009;
The following properties are exempt from this tax:
(1) Properties valued at RD$5,000,000 or below.
(2) Unbuilt lots or farms outside city limits.
(3) Property whose owner is 65 years old or older, who has owned it for more than 15 years and has no other property in his or her name.
The IPI is based on the appraised value of the building AND the lot. It does not include furniture and equipment (for example, a generator).
The old age exemption is subject to these 3 conditions:
(a) Owner must be 65 or older,
(b) Home has belonged to owner for at least 15 years,
(c) Owner does not own any other real estate.
Certainly the 5,000,000 peso exemption has increased due to inflation.
Perhaps this can be moved to Legal as suggested by dv8...and updated by Fabio or someone from his legal staff.
Respectfully,
Playacaribe2
No not necessarily so..you have to have owned the property for quite a long period of time..I forget the years and can only have one property
15 years of ownership according to the post above, being 65 or over 65 and the only property you own. If I am still here at 65 all of those stars will have aligned.
Only properties held in the name of an individual are subject to an annual property tax ("IPI") of 1%. This annual tax is assessed on real estate properties owned by individuals, based on the cumulative value of all the properties owned by the same individual, as appraised by the government authorities. Properties are valued without taking into consideration any furniture or equipment to be found in them.
For built lots, the 1% is now calculated only for values exceeding 6,858,885.00 DOP. For unbuilt lots, the 1% tax is calculated on the actual appraised value without the exemption.
The exceptions quoted above in this thread still apply: the only change is the amount of the threshold, which is now 6,858,885 pesos instead of 5,000,000 because this last figure has been adjusted to reflect inflation.
If the property is held by a corporation, no property tax is due. Instead, the corporation must pay a tax on corporate assets. However, any income tax paid by the corporation will constitute a credit toward the tax on assets, so that if corporate income taxes paid are equal to or higher than the taxes on assets due, the corporation will have no obligation to pay taxes on its assets.
For built lots, the 1% is now calculated only for values exceeding 6,858,885.00 DOP. For unbuilt lots, the 1% tax is calculated on the actual appraised value without the exemption.
The exceptions quoted above in this thread still apply: the only change is the amount of the threshold, which is now 6,858,885 pesos instead of 5,000,000 because this last figure has been adjusted to reflect inflation.
If the property is held by a corporation, no property tax is due. Instead, the corporation must pay a tax on corporate assets. However, any income tax paid by the corporation will constitute a credit toward the tax on assets, so that if corporate income taxes paid are equal to or higher than the taxes on assets due, the corporation will have no obligation to pay taxes on its assets.
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Thank you Fabio. Is property held outside a municipality treated the same tax wise? For example is a finca or vacant property in the campo taxed the same way?
Interesting... didn't know the corporations do not need to pay property tax. So basically corporation gets a perpetual or 50-year loan to purchase/construct the property at very minimum interest rate from the lender and then your total tax is just 1% of corporation's basic capital, as per my now-test-calculated IR-2 annex A-1. Really interesting.
In a corporation, the property is an asset upon which taxes are paid every year.