Do I need a tourist license for vacation rentals in Dominican Republic?

One of the concerns that an investor in the Dominican Republic may have is the legal aspects related to vacation rentals. Do I have to pay taxes on the rent of a property I have purchased? Do I need to apply for an tourist license for vacation rentals and thus operate legally?

In fact, rent a property in Dominican Republic for short-term periods is very simple, and can be done legally if you take into account the following guidelines.

At Vivantia Homes we want to clarify all these points so that you know everything you need to know regarding the apartment rentals in Dominican Republic for tourists.

What is vacation rental?

The first thing you should be clear about is that vacation rentals consist of renting an apartment on a short-term basis, for periods of less than 3 months, which leaves you outside of the guidelines set out by the tenant law in the Dominican Republic.

We are therefore talking about short-term rentals, These are generally intended for tourists who are going to spend a short period of time in the country.

This type of rental is much more lucrative, because the price per night can vary over time, so although your apartment will not always be occupied, you will be able to get a higher return month by month.

Is it legal to rent a tourist apartment in the Dominican Republic?

If you buy a tourist apartment in Dominican Republic, you can rent it legally, even if you are a foreign investor. There are no regulations that prevent you from obtaining a commercial return on rentals, so unlike other countries where there are severe restrictions for foreign investors, buying and renting an apartment in the Dominican Republic is perfectly legal and highly profitable.

However, you should be aware that there are some legal obligations when renting an apartment you must take into account to be able to perform these operations correctly.

Is it necessary to apply for a tourist license in the Dominican Republic to rent?

This is where many may have doubts. The truth is that to rent an apartment on a sporadic basis no specific tourist license is required.

However, when the property is promoted on a regular basis as a tourist accommodation or as a if two or more properties are managed with services similar to those offered by a hotel, sometimes certain requirements may have to be met.

Think that if you offer services such as breakfast, luggage storage or cleaning and security services, In this case, it can already be seen as a business, so in this case a tourist license would be required.

In this case, you would have to register with the Dirección General de Impuestos Internos (DGII), whether you are a company or you bought your apartment as an individual. In this case, you will have to declare your income and comply with your tax obligations, i.e. the payment of internal taxes.

The easiest way to rent tourist apartments is buying an apartment that is already integrated in a condominium, The regulations of which do not impose any impediment and are especially designed for those who wish to invest and rent their home on a short term basis to tourists.

What taxes do I have to pay as a foreign investor if I rent an apartment I bought?

Some people may be concerned about the taxes in Dominican Republic The tax payable on the income obtained from the rental of apartments.

What is certain is that there are advantages for investors who buy and rent apartments subject to the Confotur Law, which is why they can be exempted from IPI and real estate transfer for 15 years, as well as on income tax.

On the other hand, hosting providers must collect ITBIS on the services rendered, although it should be noted that it is the people who rent your property who pay this tax.

Buys and rents apartments and delegates property management to a hotel brand

One of the most interesting alternatives for investors seeking to maximize profitability and, at the same time, reduce the operational burden of their apartments for rent, is to delegate the property management in a hotel brand.

By delegating the property management of your rental apartments, You will only have to worry about receiving your income from short-term rentals, and not having to do the actual work involved in becoming a tourist accommodation service provider.

In addition, the fact that buying a property in a condominium from a developer, The legal advantages of the Dominican Republic, instead of buying a lodging, make the process of regularizing your tourist rental business in the Dominican Republic easier.

Are you an investor looking for properties for rent in Dominican Republic? From Vivantia Homes we encourage you to solve all your doubts. already booking a call