Good to know
Good to Know
- There is no local-partner or nominee-shareholder requirement to own a company in the Dominican Republic — foreigners can hold 100% of the shares and fill 100% of director seats, even while living abroad.
- All incorporation paperwork must be in Spanish, and most foreigners use a local lawyer/notary both to translate/draft documents and to handle the in-person Chamber of Commerce filing.
- Getting the RNC (tax ID) is free, but getting authorization to actually issue legal invoices (fiscal receipts / e-CF) is a separate step that can add real time — don't assume you can invoice clients the day you're incorporated.
- A simpler and cheaper alternative to a full SRL for solo freelancers/consultants is registering as a persona física (sole proprietor) with the DGII, which has no minimum capital requirement — worth considering if you don't need a multi-shareholder entity.
- Bank account opening is frequently the slowest, least predictable part of the process — build in buffer time and expect to provide extensive documentation on company activity and shareholders.
- Forming an SRL (the standard local LLC) gives liability protection and access to a corporate RNC/bank account, but locks you into monthly ITBIS, Format 606/607, and (from May 2026) electronic-invoicing compliance — real ongoing accounting overhead for a small Cabarete business.
- If you're a remote freelancer billing only foreign clients with no local DR customers, many nomads skip local incorporation entirely and rely on the DR's territorial tax principle — but this is informal practice, not a documented legal exemption, so get a local accountant's opinion before assuming it's risk-free.
- Budget for a Dominican accountant/gestor either way — Spanish-language bookkeeping, monthly DGII filings, and the 2026 e-invoicing mandate make DIY compliance difficult even for a simple local business.
- The 1% minimum asset tax means a barely-profitable or loss-making company can still owe tax based on its assets, which matters for capital-heavy setups like a guesthouse or dive/kite equipment rental business.
Corporate Tax If Incorporated
- Corporate Income Tax Rate
- Flat 27% on net taxable income for resident companies (SRL, SA, EIRL) and branches — this is the CIT rate quoted by both PwC's Dominican tax summary and Trading Economics.
- Loss Carryforward
- Tax losses can be carried forward for up to 3 years.
- Local Municipal Taxes
- No separate provincial or municipal income tax layer exists, but a municipal operating license is required if the business operates from a physical local premises (relevant for most Cabarete businesses — kite/surf schools, cafés, guesthouses, shops).
- Territorial Principle
- The DR taxes companies primarily on Dominican-source income; foreign-source income arising from investments and financial gains is also taxable for resident companies, but general territoriality means income genuinely sourced outside the country is treated differently from local trading income.
- Alternative Minimum Tax
- A 1% tax on gross assets applies as an alternative minimum income tax, payable instead of CIT whenever the calculated CIT would be lower than the 1% asset tax.
- Possible Tourism Incentive
- Law 158-01 offers qualifying, formally-approved tourism development projects a 20-year exemption from income tax, ITBIS, and import duties — this is a project-approval-based incentive, not an automatic benefit for any tourism-adjacent business, and would need case-by-case legal confirmation for a specific Cabarete project.
- Dividend Profit Repatriation Withholding
- A 10% withholding tax applies to dividends/profits distributed locally or remitted abroad as a definitive tax payment, including for Free Trade Zone entities on profit remittance or dividend distribution.
VAT Itbis
- Rate
- 18% standard rate (called ITBIS); a reduced 16% rate applies to certain services; basic food, medicine, water and education are exempt.
- Filing
- Businesses must register for ITBIS and file monthly returns with the DGII.
Structure Options For A Foreigner
Sa Sociedad Anonima
- Description
- A corporation-style structure, generally used for larger operations or where multiple/institutional shareholders and share transferability are wanted; more formal governance requirements than an SRL.
Sole Proprietor Persona Fisica
- Taxation
- Taxed under the personal progressive income tax scale (up to 25% top marginal rate) rather than the flat 27% corporate rate, and subject to the same monthly ITBIS/invoicing obligations if selling taxable goods/services locally.
- Liability
- No liability separation — the individual is personally exposed for business debts/claims, unlike an SRL or SA.
- Description
- Operating as an individual (persona física) registered directly with the DGII for an RNC, rather than through a separate legal entity. This is the closest DR equivalent to freelancing/sole-proprietorship.
- Practical Note
- Many foreign remote workers in Cabarete who bill only overseas clients from abroad operate informally without any local DGII registration at all, on the reasoning that the DR's territorial tax system taxes DR-source income rather than foreign-billed freelance income; this is common practice among nomads but is a legal grey area rather than a formally confirmed exemption, and does not remove the separate question of personal tax residency (covered under Visa & Legal).
SRL Sociedad De Responsabilidad Limitada
- Liability
- Provides liability separation between the business and the owner(s)' personal assets.
- Ownership
- 100% foreign ownership is permitted, with no restriction on shareholder nationality.
- Minimum Capital
- DOP 100,000
- Description
- The DR's limited liability company — by far the most commonly used structure for foreign-owned small businesses (guesthouses, kite/surf schools, restaurants, agencies).
Eirl Empresa Individual De Responsabilidad Limitada
- Description
- A single-owner limited liability entity — lets one foreign individual own a liability-shielded company without needing a second shareholder, an alternative to an SRL for solo foreign business owners.
Typical Incorporation Process And Timeline
- Typical Duration
- Roughly 2 to 4 weeks, including name registration, tax setup and bank account opening.
Steps
- Reserve the company name through ONAPI
- Draft and notarize the company bylaws (Constitution Act)
- Register with the Mercantile Registry (Chamber of Commerce)
- Pay incorporation duties/stamps and taxes
- Obtain the RNC (tax ID) from the DGII
- Open a corporate bank account
- Obtain a municipal operating license if operating from a physical local premises
Typical Costs
- Minimum Capital SRL
- DOP 100,000
Widely cited historical minimum for an SRL; some sources report this fixed minimum was removed by Law 68-19, with capital now set freely in the bylaws — confirm current requirement with a local notary.
- Rnc Tax ID Registration
- DOP 0.00
Registering for the RNC with the DGII is free of charge.
- Basic Accounting Services Monthly
- DOP 2,945
Starting price; scales with business complexity.
- Currency Note
- All figures below convert at approximately 1 USD = 58.9 DOP (rate at time of research); actual peso amounts will vary with the exchange rate on the day of payment.
Legal And Notary Fees
- Range Low
- DOP 29,450
- Range High
- DOP 58,900
Incorporation Tax Dgii
- Example On Minimum Capital
- DOP 1,000
- Description
- 1% of the company's declared/paid-in capital, paid to the DGII before registration proceeds.
Chamber Of Commerce Filing Fee
- Range Low
- DOP 5,890
- Range High
- DOP 17,670
Municipal Business Permit Annual
- Range Low
- DOP 11,780
- Range High
- DOP 29,450
Annual Compliance Financial Statement Filing
- Range Low
- DOP 17,670
- Range High
- DOP 29,450
Typical Timeline
- Overall Estimate
- Roughly 15 to 20 business days end-to-end for a straightforward SRL, from trade-name registration through Social Security/Ministry of Labor enrollment, assuming documents are ready and no name conflicts arise.
- Realistic Nomad Note
- Budget 3 to 6 weeks in practice once bank account opening delays and document-gathering (especially apostilled foreign documents for directors/shareholders) are factored in.
Breakdown
- Trade name registration (ONAPI): about 2 to 10 business days depending on publication timing.
- Drafting and notarizing bylaws/incorporation documents: about 2 to 4 days.
- Paying the 1% incorporation tax: same day to half a day once capital is deposited.
- Registration with the Mercantile Registry (Chamber of Commerce): about 5 to 7 business days.
- Obtaining the RNC and fiscal receipt (NCF) authorization from the DGII: roughly 5 to 25 days, since fiscal-receipt approval can take about 25 days.
- Corporate bank account opening: variable, and often the longest real-world bottleneck since it depends on the individual bank's compliance review.
Common Entity Types
SRL (Sociedad De Responsabilidad Limitada)
- Description
- The most common structure for small/medium businesses, similar to an LLC. Requires a minimum of 2 shareholders (maximum 50); a sole-shareholder SRL is not permitted. Historically required minimum paid-in capital of DOP 100,000, though a change under Law 68-19 is reported (per Ministry of Industry, Commerce and MSMEs guidance cited by a corporate-services source) to have eliminated the fixed minimum, leaving capital to be set in the company's own bylaws — sources still disagree on which rule is currently enforced in practice at the Chamber of Commerce, so this should be confirmed with a local notary before filing.
SA (Sociedad Anónima)
- Description
- Used for larger companies; requires at least two shareholders and a board of at least three directors of any nationality. Capital requirements for an SA are cited inconsistently across sources (figures ranging from roughly DOP 3 million to DOP 30 million authorized capital appear in different guides), so this figure needs direct confirmation from a Dominican notary or the Chamber of Commerce before relying on it.
SAS (Sociedad Anónima Simplificada)
- Description
- A simplified joint-stock structure aimed at businesses seeking outside investors, generally requiring a higher initial capital than an SRL.
EIRL (Empresa Individual De Responsabilidad Limitada)
- Description
- A single-owner limited liability enterprise with no minimum or maximum capital requirement — an option for a solo foreign owner who doesn't want a two-shareholder SRL.
Branch Office of a Foreign Company
- Description
- An existing foreign company can register a branch instead of forming a new local entity; this requires certified, apostilled/legalized corporate documents from the home country plus a locally appointed representative.
Persona Física (Sole Proprietorship/independent Contractor)
- Description
- The simplest route for a solo freelancer: no capital requirement, and foreigners can obtain a tax ID (RNC), though the ability to actually invoice and operate depends on the individual's migratory/residency status.
Scope Note
Dominican business/corporate tax law is set at the national level (DGII) — there is no Cabarete-specific municipal tax regime beyond a standard local operating license. Figures below apply uniformly across the DR, including Cabarete/Puerto Plata province.
Foreign Ownership Rules
The Dominican Republic allows 100% foreign ownership of companies with no nationality restriction on shareholders; a foreigner does not need a Dominican partner or DR residency to incorporate.
Filing And Compliance Obligations
- Cfc Rules
- The DR has no Controlled Foreign Corporation (CFC) regime, though a broad substance-over-form / anti-avoidance rule lets the DGII disregard entities or transactions used mainly to secure an unwarranted tax advantage.
- Ubo Disclosure
- Companies must declare their Ultimate Beneficial Owners to the DGII (full names, ID numbers, ownership percentages, control rights), updated within 30 days of any change; non-compliance can trigger fines and suspension of tax status.
- Monthly Filings
- Beyond the monthly ITBIS return, companies must submit Format 606 (purchases of goods/services, due within the first 15 days of each month) and Format 607 (sales) to the DGII.
- Transfer Pricing
- Transactions between related parties (generally 25%+ common ownership/control) must follow arm's-length pricing rules, with an annual informational return required to the DGII if such transactions exist — relevant for a foreign owner billing their own DR company from an offshore entity.
- Tax ID Registration
- Every incorporated business must obtain an RNC (Registro Nacional de Contribuyentes) from the DGII — this is the company's tax ID and is required to issue legally valid invoices and access banking/business services.
- Electronic Invoicing Mandate
- Law 32-23 made electronic invoicing (e-CF) the legal backbone of tax compliance; the DGII's phased rollout sets 15 May 2026 as the final adoption deadline for micro, small, unclassified and state entities — meaning essentially all small foreign-owned businesses in Cabarete will need a certified e-invoicing solution by that date.
- Payroll And Social Security If Hiring Staff
- Employers registering local staff must register with the TSS (social security system) and file monthly electronic payroll data; employer contributions total a minimum of about 15.34% of salary (AFP pension, SFS health insurance, occupational risk insurance), on top of employee deductions of about 5.92%.
Foreigners can own 100% of a Dominican company with no local-partner or local-shareholder mandate. The process is the same for foreigners and nationals, but all filings are in Spanish and typically require a local notary/lawyer to handle in-person steps at the Chamber of Commerce.
Step By Step Process
Step By Step Process
- 1. Choose entity type and reserve/register a trade name with ONAPI (Oficina Nacional de la Propiedad Industrial) — includes a name-availability search; the approved name is published in ONAPI's monthly bulletin, a step that can take about 10 days.
- 2. Draft and notarize the company bylaws (estatutos) and incorporation meeting minutes in Spanish with a Dominican notary public.
- 3. Deposit the paid-in capital into a local Dominican bank account and obtain the bank certificate confirming the deposit — this certificate is required as part of the registration filing and registration will not proceed without it.
- 4. Pay the 1% incorporation tax on capital to the DGII (Dirección General de Impuestos Internos).
- 5. File the incorporation documents, bylaws, name certificate, and tax-payment proof with the Mercantile Registry (Registro Mercantil) at the Chamber of Commerce and Production (Cámara de Comercio y Producción) covering the company's registered address, done in person and commonly with a lawyer present.
- 6. Apply for the company's Tax Identification Number (RNC) from the DGII using the Mercantile Registry certificate — this step is free of charge.
- 7. Apply for authorized fiscal invoice numbers (NCF/e-CF) from the DGII; without this the company cannot legally invoice clients.
- 8. If hiring staff, register the company with the Ministry of Labor and with the Treasury of Social Security (Tesorería de la Seguridad Social, TSS).
- 9. Obtain a municipal business operating permit from the local ayuntamiento (town hall) if the business has a physical premises.
- 10. Open a corporate bank account — requirements and wait times vary by bank.
Cabarete Specific Notes
Cabarete itself has no separate Chamber of Commerce; company registration for businesses in this area is filed through the regional Chamber of Commerce and Production covering the province (the nearest major chamber is in Puerto Plata), not in Cabarete town itself. This detail could not be independently re-confirmed for Cabarete specifically at the time of research, so nomads should verify the correct filing chamber directly with a Dominican lawyer or the Registro Mercantil portal before starting the process.
Official Registry Links
- Dgii Tax Authority
- https://dgii.gov.do
- Mercantile Registry Portal
- https://app.registromercantil.do
- Onapi Trade Name Registration
- https://onapi.gob.do
- One Stop Business Formalization Portal
- https://formalizate.gob.do
Local Partner Or Sponsor Requirement
- Detail
- Foreign nationals and non-residents may hold shares without restriction, and there is no statutory cap on foreign ownership percentage; legal entities may also act as shareholders. Directors also face no residency or nationality requirement, so an entire board can be non-resident foreigners. In practice, however, registering the company in person at the Chamber of Commerce is commonly done by a local resident, and most foreigners use a Dominican lawyer or registered agent to handle notarization and filings even though this is a practical convenience rather than a legal shareholding requirement.
- Status
- Not required for ownership
AI-generated estimateData refreshed July 2026
Sources cited for this category
These are the sources cited in this business permits & incorporation for foreigners research for this city. Individual figures may not each trace to one of them.
More About Cabarete
Data last updated July 2026 · Verify anything important.