Our guide to Payroll in Dominican Republic

Doing Business in Dominican Republic

Investing in Dominican Republic

Investing in the Dominican Republic offers opportunities

Here are some key points to consider:

Opportunities:

Sectors: The Dominican Republic actively promotes foreign direct investment (FDI) in sectors such as tourism, real estate, telecommunications, free trade zones, mining, and finance

Incentives: The government offers generous tax exemptions and other incentives to attract businesses

For example, Law 158-01 provides tax breaks for tourism-related investments

Strategic Location: Its central location in the Americas and membership in the Central America Free Trade Agreement-Dominican Republic (CAFTA-DR) provide significant advantages

Economic Growth: The country has experienced consistent GDP growth, driven by tourism and remittances 

Basic Facts about Dominican Republic

Full Name: Dominican Republic

Population: Approximately 11.5 million (2025 estimate)

Capital: Santo Doming

Major Languages: Spanish (official), with some Haitian Creole and English spoken

Monetary Unit: Dominican Peso (DOP)

Main Exports: Medical instruments, gold, rolled tobacco, low-voltage protection equipment, and ferroalloys

GNI per Capita: $9,700 (2023)

Internet Domain: .do

International Dialling Code: +1-809, +1-829, +1-849

Company Registration

Registering a company in the Dominican Republic involves several steps. Here’s a summary of the process:

Choose a Company Type:

• Limited Liability Company (LLC)
• Simplified Public Limited Company (SPLC)
• Public Limited Company (PLC)
• Single Member Limited Liability Company (SMLLC)
• General Partnership
• Limited Partnership
• Partnership Limited by Shares
• Foreign Company

Register the Trade Name:

Register your company’s trade name at the National Industrial Property Office (ONAPI)

Draft and Notarize Bylaws:

Prepare the company’s bylaws and have them notarized

Obtain a Tax Identification Number (RNC):

Register with the General Directorate of Internal Taxes (DGII) to obtain a Tax Identification Number (RNC)

Register with the Chamber of Commerce:

Submit the company registration application to the corresponding Chamber of Commerce and Production

Open a Bank Account:

Open a corporate bank account in the company’s name and deposit the required capital

Register for Social Security:

Register the company with the Social Security Treasury (TSS) to ensure compliance with labor laws

Obtain Necessary Permits and Licenses:

Depending on the business activity, obtain any additional permits or licenses required

Publish the Company’s Incorporation:

Publish the company’s incorporation in a local newspaper

Final Registration:

Complete the final registration with the Commercial Registry

Banking

It is not mandatory to make payments to employees and authorities from an in-country bank account.

Standard Banking Hours

• Monday to Thursday: 9:00 AM to 3:00 PM
• Friday: 9:00 AM to 5:00 PM

Additional Services

• ATMs: Available 24/7 for cash withdrawals and other basic transactions
• Online and Mobile Banking: Accessible anytime, allowing you to manage your finances on the go

Working Week

The standard working week in the Dominican Republic is typically from Monday to Friday

Standard Working Hours

Weekly Hours: The standard workweek is 40 hours.

Daily Hours: Typically, this translates to 8 hours per day over a 5-day workweek.

Employment Law

Employment law in the Dominican Republic is governed by the Labor Code (Law No. 16-92). Here are some key aspects:

Employment Contracts:

• Types of Contracts: Indefinite-term, fixed-term, and project-specific contracts
• Written Contracts: Required for foreign workers and must be registered with the Ministry of Labor

Working Hours:

• Standard Workweek: 44 hours, typically 8 hours per day
• Overtime: Paid at a higher rate, with specific limits on the number of overtime hours

Leave Entitlements

• Vacation Leave: Employees are entitled to 14 days of paid vacation after one year of service
• Sick Leave: Employees are entitled to paid sick leave, with the duration depending on the length of service
• Maternity Leave: Female employees are entitled to 12 weeks of maternity leave, with at least 6 weeks post-delivery

Minimum Wage:

Varies by Sector (Free tax zone). The official minimum wage in 2026is $23,223.00, Dominican pesos per month.

Termination and Severance

Notice Period: Required, with the duration depending on the length of employment

Severance Pay

Employees are entitled to severance pay based on their length of service

Health and Safety

Employers must ensure a safe working environment and comply with health and safety regulations

Tax, Employee Provident Fund, Social Security & Human Resource Development

Individual Income Tax (Taxes on Employment Income)

In the Dominican Republic, individual income tax is based on a progressive tax system. Here are the current tax rates on base of the taxable income:

• Up to RD$416,220: 0%
• RD$416,220.01 to RD$624,329: 15%
• RD$624,329.01 to RD$867,123: 20%
• Over RD$867,123: 25%

Residents are taxed on their Dominican-source income, while non-residents are taxed only on income earned within the Dominican Republic

Social Security Contributions

In the Dominican Republic, social security contributions are mandatory for both employers and employees. Here are the key contributions:

Employer and employee Contributions:

Pension and Disability Insurance (AFP): The contributions withheld for SVDS to employees is 2.87% and 7.10% to the Employer over a contributable base up to 20 minimum wages max.

Family Health Insurance (SFS): The contributions withheld for SFS to employees is 3.04% and 7.09% to the Employer over a contributable base up to 20 minimum wages max.

Occupational Risk Insurance (ARL): 1% plus 0.1% to 0.3% for the company risk level ( Low, Medium and High) of the employee's gross salary with a limit of 4 minimum wages.

INFOTEP: All companies operating in Dominican Republic are subjected to a monthly cote to INFOTEP (Technical Professional Formation Institute) this contribution is 1% of the staff salary also 0.50% of the annual bonus paid to the employees, in case they exist.

Coverage:

Public and Private Sector Workers: Both sectors are required to participate in the pension system

Disability and Survivor Coverage: Contributions also include premiums for disability and survivor benefits

Minimum Pension:

A minimum pension is guaranteed to ensure basic financial security for retirees

Regulatory Authority:

The pension system is overseen by the Superintendency of Pensions (SIPEN)

Payroll

There are no restrictions in the law or further procedures required to provide online payslips in Dominican Republic.

Reports

Payroll records and other accounting records must be maintained for a minimum of five years from the date of the transaction.

Leavers

Payment must be made to the employee within 10 (ten) days of termination; otherwise, the employer would have to pay a penalty of one’s day salary for every day of delay.

Expenses

The local legislation does not offer any other specific benefits beyond the statutory ones.

All elements such as general expenses, car mileage and company cars will be incorporated based on the company policies and how companies normally choose to pay them.

Visas & Work Permits

In the Dominican Republic, obtaining a visa or work permit involves several steps and requirements:

Visas:

• Business Visa (Visa de Negocios): Valid for 60 days with a single entry or up to one year with multiple entries. The multiple-entry visa does not allow the holder to stay for more than two months at a time
• Business Visa for Employment Purposes (Visa de Negocios con Fines Laborales): For foreign nationals employed by companies in the Dominican Republic. Valid for one year and renewable

Work Permits:

• Temporary Worker Permit (PTT): For non-residents entering with an employment contract. Valid for one year, renewable for another year
• Residence Permit: Required for foreign workers staying longer than two months. Involves additional documentation such as a medical certificate, criminal background check, and proof of financial solvency

Application Process:

1. Job Offer: Secure a job offer from a Dominican employer.
2. Employer Application: The employer applies for the work permit on behalf of the employee.
3. Required Documents: Include a completed application form, valid passport, medical certificate, police background check, and a letter from the employing company
4. Fees: Work permit fees vary based on the type and duration of the permit

Additional Information:

• English Proficiency: Required for applicants from non-Spanish speaking countries
• Dependents: Work permit holders can apply for dependents to join them

Companies operating in free trade zones may be subject to different wage or tax rules. Written employment contracts are particularly important for foreign workers. INFOTEP contributions are mandatory for all employers. Bilingual documentation is recommended for foreign executives.

Further Information

For more information, or assistance with Dominican Republic Tax inquiries please contact: gi@activpayroll.com

About This Payroll and Tax Overview

Please note that this document gives general guidance only and should not be regarded as an authoritative or complete statement of the law, regulations or tax position in any country. You should always seek specific advice for each specific situation. This document should not be relied upon as professional advice and activpayroll accepts no liability for reliance on its contents.