Hi everyone,
Taxation is an important subject, especially when you are an expatriate in Dominican Republic. We would like to know what you think about the tax system in your host country. This could be helpful to other people preparing for expatriation in Dominican Republic.
How to do your tax return in Dominican Republic? Are there different steps beforehand and if so, what are they?
Is it easy or did you have to get help to complete it?
Are there any important elements that should be taken into account when doing your tax return in Dominican Republic?
If you are self-employed, do you need an accountant to do your tax return?
Is there a non-double taxation agreement with your home country? In any case, do you have to pay taxes there as well?
Thanks for your contribution!
Diksha,
Expat.com team
All about taxes for expats in Dominican Republic
This is an unbelievably complicated subject. There are lots of rules and lots of exemptions and lots of different categories!
After 18 years here I still do not fully understand how things work! I have an accountant and seriously he cannot fully explain stuff in a way you can actually understand!
I really really dislike this topic. LOL And I hate paying taxes.
Let me try to shed some light:
WE dont have "tax returns" as such
Self employed and declaring taxes - get an accountant
Employee - its pretty much done for you or should be done for you by the employer if you are legal.
Companies - stupid and complicated - get at least one accountant
Taxation agreements - that is by country. Too many to list here!
The law here is territorial. IF you earn money here you are supposed to pay taxes, one way or another. IF you have income that is not EARNED then that is non taxable. AGAIN there are lots of exceptions.
I don't know enough about the DR tax system to comment on it, but I will confirm that US citizens must file a US tax return even if they are expats! If you have earned income in the DR, you might qualify for a Foreign Income Tax Exclusion or Foreign Tax Credit, but you still have to file. You must also disclose your foreign bank accounts and financial assets by filing an FBAR each year.
Hell out there guys the US is pretty much following your income earned in the US in many countries. Safe havens like the Cayman Islands , Luxembourg, and swiss are required to report to the US and I have notice that countries that are lax on taxes to expads have a currency ratio that favor the American dollar in that said country but reverse the peso to American to return to the US and you are practically broke so you keep the money in there bank waiting for a much better exchange ratio , 20 years go by and it does not change their banks get fat
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