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8.2.2. Withholding Taxes

The withholding tax ('WHT') rates levied on income received / derived by the non-residents from sources within Dominican Republic are as below:

Dividend

Tax is withheld at the rate of 10% on dividends paid by Dominican Republic resident entities including FTZ entities to non-residents.

Withholding tax is not due on the dividends distributed by a company to the shareholders out of dividend income already charged to withholding tax at the rate of 10%, to the extent such dividend is recorded in the company’s dividend account.

Interest

Tax is withheld at the rate of 10% on interest paid by Dominican Republic resident entities to non-residents.

Royalty Copyright

Tax is withheld at the rate of 27% on royalties paid to non-residents.

Royalty Patent

Tax is withheld at the rate of 27% on royalties paid to non-residents.

Royalty Trademark

Tax is withheld at the rate of 27% on royalties paid to non-residents.

Service Management

Tax is withheld at the rate of 27% on service management fees paid to non-residents.

Service Technical

Tax is withheld at the rate of 27% on service technical fees paid to non-residents.

Others

A final withholding tax may be levied on other payments made to non-resident at a rate of 27%.

Tax is withheld at the rate of 1% of value of transfer of shares by non-residents, and tax withheld is payable by the seller.

Below is a discussion of domestic withholding tax rules for most of the common cross-border payments.

Capital Gains 27.0 %
Dividends 10.0 %
Interest 10.0 %
Royalty Copyright 27.0 %
Royalty Patent 27.0 %
Royalty Trademark 27.0 %
Sales 0.0 %
Service Management 27.0 %
Service Technical 27.0 %

* Rates are current as of 25 September 2022