IPI, Real Estate Tax

The Real Estate Property Tax, also called IPI, is an annual tax that is applied to the total amount of taxed real estate assets registered by individuals and Trusts.

Who is subject to the payment of this tax?

Individuals and Trusts

What is an encumbered estate?

The properties that do not enjoy any exemption and at the same time have a joint value greater than (RD$ 9,520,861.00).
For trusts, any property that does not enjoy an exemption regardless of its value.

What properties can be reached by this tax?

All homes.
Urban lots.
Properties intended for commercial, industrial and professional activities.

Rate

Individuals: a rate of 1% is applied on the excess value of RD$ 9,520,861.00 of the encumbered assets.
Trusts: 1% on the value of real estate.

This tax is paid in two (2) semi-annual installments, with the deadline for payment of the first installment being March 11 and the second on September 11 of each year.

Exemptions

Among the exempt properties and therefore excluded from taxed assets, are:

The home (and the plot of land on which it is built) belonging to people over 65 years of age, as long as this constitutes the only real estate assets of its owner.
Pensioners and rentiers from foreign sources by 50%.
rural land.
Real estate for agricultural use located on rural land.
All properties that, even though they may be reached by the tax, their joint value is equal to or less than RD$ 8,138,353

Real estate transfer

To carry out the transfer of a property, you must submit certain documents to the Appraisal Unit of the Local Administrations of the DGII, depending on the case.

The Appraisal Unit will verify the documentation deposited and will authorize the payment of the transfer, with which the taxpayer may approach the cash unit of any local administration to make the payment within a period of 30 days (not to exceed December 31, current year). In the event that the taxpayer does not make the payment during the indicated time, he must approach the Appraisal Unit again so that the payment is authorized once again.

The transfer tax rate is three (3%) of the value of the real estate or property.

The buyer may make the payment corresponding to the real estate transfer tax without surcharges and interest, within a period of 6 months from the date that the property transfer act was perfected, in accordance with the provisions of Law No. 18- 88.

For more information on taxes on real estate assets, appraisal, real estate transfer, appraisal or discharge of real estate, please contact us. With great pleasure we will help you.