Dominican Property Taxes: What Buyers Pay, When, and What Changed in 2026

Six months. That is how long a buyer of Dominican real estate has to pay the 3% transfer tax after closing before surcharges and interest begin to accrue, and it is the deadline most often missed by foreign purchasers who assume the closing itself settled everything.

Every purchase or sale of real estate in the Dominican Republic should rest on a written contract identifying the property, the price and the conditions of sale, legalized before a Dominican notary. Documents signed abroad must instead be apostilled or legalized at the nearest Dominican consulate. Buyers who cannot travel commonly grant a power of attorney so counsel can run the due diligence and file the transfer before the Title Registry, a routine step, but one that must itself be properly legalized to be effective.

The 3% and the valuation trap

The transfer tax is 3% of the property’s value, payable by the buyer unless the parties agree otherwise. Here lies the trap: the law does not clearly define which “value” governs, contract price, market value or fiscal value. In practice, the tax authority (DGII) applies the higher of the price stated in the contract and the value in its own registers. A buyer who budgets 3% of the negotiated price may face a materially larger bill if the DGII’s appraisal runs higher, and challenging that appraisal is possible but takes time. Budget against the DGII value, not just the contract.

The tax picture is bigger than the transfer

Depending on the transaction, other taxes come into play: capital gains tax for the seller, the annual real property tax (IPI) for individual owners above the exempt threshold, and the corporate asset tax where a company holds the property. Exemptions exist too, notably for low-cost housing and for projects under special incentive laws, and choosing the right acquisition vehicle (personal ownership versus a holding entity) can change the lifetime tax cost of the investment significantly.

2026: the rules are moving

Buyers and sellers should know that the Dominican Republic’s 2026 fiscal reform reshaped the taxation of real estate transactions, including a new preferential capital-gains regime for real estate dispositions and the scheduled phase-down of certain registry-related taxes on property operations. Anyone closing a transaction now should have counsel confirm which rules apply to their specific closing date, because timing a sale on either side of these changes can carry real money.

Before you sign a promise of sale, get a Dominican real estate attorney to quantify the full tax cost of the deal, transfer tax on the DGII value, the seller’s capital gains exposure, and the annual taxes you inherit, so the price you negotiate is the price you actually pay.

Arthur & Castillo combines real estate, tax and valuation expertise to structure property purchases and sales for foreign and local clients across the Dominican Republic. Request a transaction tax review before your next closing.

Do you want more information about property transaction services in Dominican Republic? Contact Us.

ABOUT THE AUTHOR: Maria Arthur Rodger is a Partner leading the Private Client, Successions and Tax areas at Arthur & Castillo Advisers and Consultants in the Dominican Republic. She specializes in private client, successions, tax, real estate valuation and advisory (Master in Tax and Finance Studies from Georgetown University in Washington, D.C. & Universitat Pompeu Fabra in Barcelona) with more than 20 years of experience. She is also a Certified Public Accountant (CPA), Certified Valuator, Business Bankruptcy Expert and English and Spanish Interpreter.

Email: marthur@aclaw.com

Disclaimer: This publication is not intended to provide advice or suggest a guaranteed outcome as individual situations will differ and the situation may have changed since publication. For specific advice on the information provided and related topics, please contact the author.

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