Dominican Republic company registration

DOING BUSINESS IN DOMINICAN REPUBLIC

Since 2003, Healy Consultants Group PLC has assisted our Clients with starting their company in the Dominican Republic. Our services include i) Dominican Republic business registration ii) government license registration iii) business bank account opening iv) employee recruitment strategies v) visa strategies and vi) office rental solutions.

SummaryLLCTax exempt LLCFast business setup solutionFree zone LLCSimplified corporationPublic limited companyRepresentative officeBranch office
Also known asSRLOffshore companySRLSRLSASSAOficina de representacionSucursal
Best use of company?All products and servicesInternational tradingClose a customer deal nowManufacturing and export tradingTo issue debtTo secure public fundingMarketing & researchSpecific projects
How soon can you invoice Clients/sign sales contracts?2 months2 months2 weeks3 months3 months3 months3 months3 months
How soon can you hire staff?1 month1 month2 weeks2 months2 months2 months2 months2 months
How soon can you sign a lease agreement?1 month1 month2 weeks2 months2 months2 months2 months2 months
How long to supply corporate bank account numbers?2 months2 months2 weeks3 months3 months3 months3 months3 months
How long to supply company registration/tax numbers?1 month1 month1 week2 months2 months2 months2 months2 months
Corporate tax rate on annual net profits?27%0%27%0%27%27%0%27%
Limited liability entity?YesYesYesYesYesYesNoNo
Resident director/partner/manager/legal representative required?NoNoNoNoNoNoYesYes
Minimum paid up share capital?US$1US$1US$1US$1US$6,300US$63,000NoneNone
Can bid for Government contracts?YesNoYesYesYesYesYesNo
Corporate bank account location?Scotia bankPromerica bankScotia bankBHD LeonPopular DominicanoPromerica bankBHD LeonPopular Dominicano
Can secure trade finance?YesYesYesYesYesYesYesNo
VAT payable on sales to local customers?18%18%18%18%18%18%Cannot18%
Average total business set up engagement costs?US$15,300US$17,300US$31,115US$17,650US$16,500US$18,000US$15,950US$16,250
Average total engagement period?3 months3 months4 months4 months4 months4 months4 months4 months

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Accounting and tax considerationsLLCTax exempt LLCFast business setup solutionFree zone LLCSimplified corporationPublic limited companyRepresentative officeBranch office
Statutory corporate tax payable?27%0%27%0%27%27%0%27%
Legally tax exempt if properly structured?NoYesYesYesNoNoYesNo
Must file an annual tax return?YesYesYesYesYesYesNoYes
Must file annual financial statements?YesYesYesYesYesYesNoYes
Must appoint an auditor?NoNoNoNoNoYesNoNo
Access to double taxation treaties?YesNoYesYesYesYesNoYes
Withholding tax on payments to foreign shareholders?10%None10%10%10%10%None10%
Company RegistrationLLCTax exempt LLCFast business setup solutionFree zone LLCSimplified corporationPublic limited companyRepresentative officeBranch office
Resident director/partner/manager/ legal representative required?NoNoNoNoNoNoYesYes
Minimum number of shareholders/partners?222222Parent companyParent company
Maximum shareholding for foreigners?100%100%100%100%100%100%100%100%
Minimum statutory paid up share capital?US$1US$1US$1US$1US$6,300US$63,000NoneNone
Shelf companies available?YesYesYesNoNoNoNoNo
Time to incorporate a new entity?1 month1 monthN/A2 months3 months3 months2 months2 months
Can easily convert to a PLC?YesYesYesYesYesN/ANoNo
Public register of shareholders and directors?YesYesYesYesYesYesYesYes
Can have preference shareholders / owners ?YesYesYesYesYesYesNoNo
Business ConsiderationsLLCTax exempt LLCFast business setup solutionFree zone LLCSimplified corporationPublic limited companyRepresentative officeBranch office
Good entity for trademark registration?YesNoYesYesYesYesNoYes
Can secure an import and export license?YesYesYesYesYesYesNoYes
Sponsorship by a local citizen required?No
Our Client needs to travel to Dominican Republic for business set up?No
Temporary physical office solutions available?Yes
You need a local resident as bank signatory?No
Government approval required for foreign owners?No
Can be wholly foreign owned?Yes
Security deposit to be kept with Government?No
The entity will likely be regulated by?Camara
Minimum number of directors/managers?1
Group HQ tax incentives?No
Monthly VAT reporting to the Government?Yes
Must sign an office lease agreement during incorporation?No
Shareholders & directors documents to be attested/translated?Yes
Foreign non resident director needs an individual tax number?No
Foreign director needs a residence visa?No
Maximum number of staff allowed?No
Expatriate to local staff ratio?None
Can secure residence visa for business owner?Yes
Other useful information
This country has signed free trade agreements?Yes
This country is a member of WIPO/TRIPS?Yes
This country is a member of the ICSID?Yes
Average custom duties suffered?0.068
Government foreign investment approval required?No
Average monthly office rental? (US$ per sq m)US$30
Minimum statutory monthly salary?US$150
Average monthly US$ salary for local skilled employees?US$500
RD$ deposit interest rate? (1 year average)0.04
US$ deposit interest rate? (1 year average)0.0025
Overseas remittance currency controls?No
Banking considerations
Multi-currency bank accounts available?Yes
Corporate visa debit cards available?Yes
Quality of e-banking platform?Good
Crowd funding available in this country?Yes

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  • Advantages and disadvantages

    Advantages of Dominican Republic company registration

    1. A Dominican Republic limited liability company can be incorporated with 1 director and 2 shareholders, who can be of any nationality and can be individuals or corporate bodies. The minimum paid-up capital required is only US$2,300 and our Clients do not need to travel to complete registration of their company in the Dominican Republic;
    2. Foreigners investing in a new Dominican Republic business for an amount over US$200,000 are eligible to the Center for Export and Investment’s Investor Program, granting them residency visa. The application is usually processed within two months;

    Disadvantages of Dominican Republic company registration

    1. The Dominican Republic is a small market, with only 10 million inhabitants. The average GDP only reaches US$6,000 per person in 2014, meaning that our Clients’ sales will be low within the country;
    2. English speaking entrepreneurs can encounter difficulties dealing with their Clients and employees in the Dominican Republic. Locals are indeed Spanish-speaking and have a low proficiency in English, placed at position 33 out of 44 countries according to the English proficiency index by Education First;
    3. Outside of the free zones, Dominican Republic is not a low tax country: registered business are subject to i) a corporate tax levied at a standard rate of 27% ii) withholding tax on dividends remitted outside of the country levied at 10% and iii) VAT at a standard rate of 16%, and VAT registration is mandatory;
    4. Only two countries have signed a double taxation avoidance agreement with the Dominican Republic, namely Spain and Canada.
  • Best uses for a Dominican Republic company

    1. The Dominican Republic is an interesting choice for entrepreneurs relocating manufacturing and services operations, because:
      • Our Clients can register their Dominican Republic company in a free zone to benefit during up to 16 years from generous tax advantages including: i) reduced or waived corporate tax ii) exoneration of VAT and iii) no custom duties on imported raw material and equipment;
      • Labor costs will be low for companies registered in the Dominican Republic: i) average salaries are only US$300 per month and ii) the minimum monthly wage is in between US$170 and US$320 according to the employee’s occupation;
      • The Dominican Republic being a member of the Central American Free Trade Agreement, products manufactured locally can be sold free of custom duties to consumers in the United States, as well as other Central American markets including: i) El Salvador ii) Guatemala iii) Honduras iv) Nicaragua and v) Costa Rica;
      • It is easy to export from the Dominican Republic: the country’s custom procedures are indeed ranked as the 24th best in the world by the World Bank. The country also benefits from easy maritime access and good port infrastructure.

    2. Our Clients often consider to start a tourism business in the Dominica Republic, because:
      • The Dominica Republic is the top tourism destination amongst Caribbean countries, with 5 million of visitors recorded in 2014. Most of them are affluent foreigners coming from the United States and European countries;
      • The government grants up to 10 years of tax holidays to new businesses established in Dominica Republic in the tourism industry. Acquisition of land property can also be done free of government taxes;
      • Unlike neighboring Haiti, the Dominican Republic is a politically stable country, henceforth with little risk of major events destabilizing tourist arrivals in the island.

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Company registration

  • Time to incorporate: Four weeks
  • Cost to set up: US$15,300
  • Minimum capital: US$2,300
  • Physical office required: Yes

Required appointments

  • Shareholders: 2
  • Directors: 1
  • Company secretary: No
  • Resident director: No

Key facts

  • Corporate tax rate: 28%
  • Corporate tax base: Territorial
  • Shelf companies: Unavailable
  • Main company type: Compañía limitada

Contact us

For additional information on our company registration services in Dominican Republic, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi
dominican-taxdomonivan-mofdominican-govdominican-cocdomincan-bank