Tax rate by region Dominican Republic

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The information provided on this page is intended for general informative purposes only. It should not be interpreted as tax advice, nor is it meant to be. For advice on your particular tax responsibilities, consult with an experienced tax expert. PayPro Global does not assume any responsibility for any action taken or not taken based on the information presented here.

Understanding SaaS Sales Tax in the Dominican Republic: A Comprehensive Guide

In the Dominican Republic, SaaS (Software as a Service) providers navigate a sales tax landscape defined by a 18% Value-Added Tax (VAT). Implemented in 1992 to diversify revenue and enhance tax compliance, this tax applies to most digital services, including SaaS offerings. Understanding the nuances of VAT and its implications is crucial for businesses to ensure seamless and compliant operations within the Dominican market.

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Dominican Republic

Dominican Republic implemented a VAT system in 1992, aiming to diversify its revenue sources and enhance compliance.

Official government link: Dirección General de Impuestos Internos

18.00%

E-products and services VAT/Sales tax rate

Reduced tax rate product categories

Online sale of e-books

Exempted product categories

No digital goods or services are exempt in the Domican Republic

Reverse charge mechanism for B2B sales

Applies when non-resident has no DRC VAT representative.

Tax ID validation required

Yes

When do you have to register

Registration is required prior to starting taxable activities

Online registration possible

Yes

Local representative needed

Yes

Registration procedure

Businesses need to register electronically or in person with the Dominican tax authorities within 30 days of the date on which tax liability begins.

List of digital and electronic services liable for tax

online advertising
online intermediation (commissions)
data transmission
streaming

Penalties

In the Dominican Republic, if the ITBIS is filed or paid late, a penalty is imposed. This penalty is 10% of the due amount for the first month of delay, and for the subsequent months, it is 4% of the due amount.

Registration threshold

No threshold, non-resident companies must register for VAT

Filing interval

Monthly

Filing deadline

The cut-off date for submission and payment is the 20th day of the month that comes after the reporting period.

E-invoicing requirements

Yes 

Record keeping

Companies are required to keep detailed records of all transactions, encompassing both sales and purchases, in order to substantiate their ITBIS filings. In accordance with the tax code of the Dominican Republic, these accounting records must be preserved for a duration of 10 years.

How-To Guides: Dominican Republic SaaS VAT

Step: 1 Threshold

There is no registration threshold for local entities; registration is mandatory upon starting operations. For non-residents, the 2025 mandate (Decree 30-25) requiring digital providers to register was repealed in March 2025. Currently, non-resident SaaS providers are not required to register unless they have a Permanent Establishment.

Step: 2 Business Registration

Handled by the DGII (Dirección General de Impuestos Internos). Resident businesses must obtain a Registro Nacional de Contribuyentes (RNC).

Step: 3 TIN/VAT Number

The tax ID is the RNC, issued by the DGII.

Step: 1 Standard ITBIS (VAT) Rate

The standard ITBIS (VAT) rate in the Dominican Republic is 18%.

Step: 2 VAT Formula

To calculate your tax amount, use the following formula:

 

Tax Amount = Net Price x 18%

Step: 3 Record Keeping:

Step: 1 Selling B2C

Following the repeal of Decree 30-25, non-resident SaaS providers are not currently required to collect ITBIS from individual consumers. The government may eventually capture this via withholdings on credit card processors, but the provider is currently exempt from direct collection.

Step: 2 Selling B2B

Foreign SaaS providers should not add ITBIS to their invoices. The local business recipient must withhold the tax at the source.

Step: 3 Invoice Requirements

To allow the Dominican buyer to deduct the expense, the invoice should include:

  • Supplier Legal Name
  • Address
  • Country of Origin
  • Date
  • Service Description
  • Amount
  • Currency.

The buyer will then issue a local “Comprobante de Pago al Exterior” (B17) in the DGII system.

Step: 1 Filing Interval

In the Dominican Republic, taxes are to be filed monthly (only for RNC-registered entities).

Step: 2 Filing Deadline

Returns must be filed and paid by the 20th day of the month following the reporting period.

Step: 3 Submission

Declarations (Form IT-1 for ITBIS and IR-17 for withholdings) are submitted via the DGII Virtual Office (OFV). Payment is made through authorized banks or electronic transfers.

Step: 4 Record Keeping

All tax-related documentation and accounting records must be kept for a minimum of 10 years (Art. 50 of the Tax Code).

PayPro Global Solution: Simplified Registration & Fiscal Representation

Navigating the Dominican REpublic’s VAT registration and fiscal representation can be daunting. PayPro Global acts as your Merchant of Record, handling these complexities, including VAT registration and fiscal representation where needed, so you can focus on your business.

Learn more about our MoR services.

FAQ

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