Question 1

What is CONFOTUR and how does it work?

Accepted Answer

CONFOTUR (Consejo de Fomento Turístico) is a Dominican government program under Law 158-01 that grants tax exemptions to qualifying tourism-related real estate developments. Properties with CONFOTUR certification are exempt from the 3% transfer tax at purchase, the annual IPI property tax, and income tax on rental revenue for up to 15 years, counted from the date the project's construction and equipping are completed — not from the resolution date.

Question 2

How do I verify a property's CONFOTUR status?

Accepted Answer

Always verify independently: (1) Request the official CONFOTUR resolution number from the developer or seller, (2) Confirm when the project's construction and equipping were completed — the 15-year clock runs from that date, not the resolution date — and calculate the remaining exemption years, (3) Verify your specific unit type is covered in the resolution — some resolutions only cover certain phases or unit types, (4) Have a local attorney (abogado) verify the resolution status directly with the CONFOTUR office.

Question 3

Does CONFOTUR transfer when I resell the property?

Accepted Answer

No. Ley 158-01 (Art. 4, Párrafo IV) grants the exemptions to whoever invests directly with the promoter or developer, and expressly excludes any later transfer in favour of third-party acquirers — in practice DGII applies them only to that first buyer. A resale buyer therefore does not inherit the remaining years, and the 3% transfer-tax exemption does not cover the resale transaction itself. A seller cannot guarantee otherwise. Where the unit is held by a company (SRL), buyers sometimes acquire the company's shares instead — the property never changes hands, so the exemption stays with the SRL. Confirm any such structure with your own Dominican attorney before relying on it.

Question 4

What happens when the CONFOTUR exemption expires?

Accepted Answer

Once the exemption period ends, you become subject to all standard DR property taxes: the annual IPI property tax (1% on assessed value above ~$182,000 USD), Dominican income tax on rental revenue (individuals: progressive up to 25% on net rental; companies (SRL/EIRL): 27% flat on net), and the 27% capital gains tax on any future sale. Plan your investment model accounting for these costs after expiration. Use the Tax Entity toggle above to see savings under each structure.

Question 5

Is rental income really tax-free under CONFOTUR?

Accepted Answer

Yes, during the active CONFOTUR exemption period, rental income generated by the certified property is exempt from income tax (ISR), regardless of whether you own as an individual or through a Dominican company (SRL/EIRL). Without CONFOTUR, individuals pay progressive ISR (up to 25% on net rental, with an annual exemption around RD$416,000 / ~$6,700 USD); SRL/EIRL companies pay 27% flat on net rental. Non-resident individuals receiving gross rental payments may face a separate 27% withholding regime if they have not elected resident treatment. Either way, maintain proper records and file declarations during the exemption period.

Question 6

What's the difference between CONFOTUR and Law 171-07?

Accepted Answer

CONFOTUR (Law 158-01) is a project-level certification, but its exemptions reach only the first buyer purchasing directly from the developer — they do not pass to later owners (Ley 158-01, Art. 4, Párrafo IV). Law 171-07 is an investor-level benefit: it grants expedited residency and a 50% reduction on property and capital gains taxes to individuals investing $200,000+ in Dominican real estate. They are separate programs and can sometimes be combined.

Question 7

Do I still need to file taxes during the CONFOTUR period?

Accepted Answer

Yes. Even with CONFOTUR exemptions, you should file tax declarations with the DGII (Dominican tax authority) and reference your CONFOTUR resolution number. The exemption reduces your liability to zero, but the filing obligation remains. A local accountant familiar with CONFOTUR can ensure compliance and protect your exemption status.

The exemption worth six figures.

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