Inheritance Tax in the Dominican Republic
The Inheritance Tax in the Dominican Republic applies to all assets located in the Dominican Republic, regardless of the last domicile of the decedent and of whether the succession is testamentary or intestate. If the deceased was a Dominican citizen or had its last domicile in the Dominican Republic, the inheritance tax also applies to all movable assets.
The transfer of assets from the decedent to the heirs should be subject to an inheritance tax at a 3% rate over the estate, payable by the heirs, successors and legatees, as per the provisions of Law 2569 of Successions and Donations dated December 4 of 1950.
Certain allowable deductions may be made from the total value of the items that conform the estate, which may include: debts and last sickness expenses, under certain conditions, mortgage credits subject to certain requirements, some amounts owed derived from pending taxes or to workers, and funerary expenses.
A filing of an inheritance tax return is required within ninety days of when death occurred. Therefore, the importance of gathering and obtaining the pertinent documents on time, or of requesting an extension to file at a later date, given that surcharges and interest penalties may apply to late filing.
The relevance of a specialized tax attorney for preparing and filing the inheritance tax return on your behalf lies in the difficulties that may arise in determining the “value” of the estate when real estate property, stock or other capital assets are involved; the applicable inheritance tax exemptions, and the rightful means to contest or appeal an inheritance tax liquidation by the revenue service.
ABOUT THE AUTHOR: Dra. Maria Arthur Rodger is a Partner, Head of Tax & Private Client at ACLAW, a law Firm in the Dominican Republic. She specializes in tax law, (Tax LLM in Georgetown Law Center & Tax LLM in Universidad Pompeu Fabra), including ample knowledge on the tax systems of the United States, Spain and Central America, and with more than 20 years of experience in tax advisory, tax disputes with the revenue service and tax litigation; since the enactment and development of the Dominican Tax Code. Dra. Maria Arthur is a CPA, Certified Bankruptcy Liquidator and Legal Interpreter.
Email: [email protected]
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Disclaimer: This publication is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. For specific technical or legal advice on the information provided and related topics, please contact the author.