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Closing Costs

Real Estate Transfer Tax (Law 33-91) 

 

Once a property has been purchased the following will need to be delivered at the DGII in order to request authorization to pay the transfer tax:

  • Original of the Sales Contract
  • Seller property Title Certificate 
  • Seller Personal Identification
  • Buyer Personal Identification  

 

 

Transfer Tax Procedure

  • 3% of the purchase price of the property (as in the sales contract) or the price resulting from the valuation carried out by the DGII, whichever one is higher.
  • Property purchased by the purchase of company shares, then there is a 1% tax added.
  • The DGII has the right to inspect the property before authorizing the payment of the tax.
  • Tax must be paid within six (6) months of signing the sales contract.
  • Paid by the buyer (unless otherwise agreed by the parties)
  • Payable to Local Internal Revenue Office (Dirección General de Impuestos Internos DGII)
  • Once the tax is paid the following are filed with the title registry office in jurisdiciton where property is located:
    • Originals of the sales contract
    • Original property title certificate
    • Receipt of transfer tax payment - issued by the DGII
    • Title registrar registers the purchase in its records
    • Cancels the seller’s title certificate 
    • Issues new title certificate in favor of the buyer.
    • Issuance of title certificate takes between 30 and 90 days.

Lawyer Fees

  • 1 to 1.5% of the purchase price

Summary

  • Taxes and fees will vary depending on values.  Safe to assume 5% of the purchase price for taxes, fees and documentation.

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