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Income tax advances exemption for the periods August-December 2020 and First Quote Exemption from Assets Tax (ISA) for Micro and Small Businesses for fiscal year 2020.

August 29, 2020 by Franco
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Resolution No. DDG-AR1-2020-00001 issued by the Internal Revenues General Direction (“DGII”).

Purpose of the Resolution: 

  1. Advance Income Tax (ISR) exemption in the period between August and December 2020. 
  2. Exemption over the First Installment of the Asset Tax (ISA) to Micro, Small and Medium Enterprises (MIPYMES) and taxpayers of the hotel sector whose registered activities are limited to the economic activities of the International Standard Industrial Classification.

Individuals or single-owned businesses that are micro and small companies benefit from these exemptions (total gross sales do not exceed RD $ 58,314,600 per year)

The taxpayers that do not apply for the exemption established in paragraph (i) above, may request a total or partial exemption of advances, provided that they present and demonstrate a significant reduction in their income during 2020 in comparison to 2019. For such purposes, the applicant must complete the form provided by the Tax Administration at least fifteen (15) days before the expiration date, and send the request including the corresponding justification.

The hotel sector will benefit from both exemptions established in sections (i) and (ii) above, if its registered activities comply with the provisions contained in the International Standard Industrial Classification (ISIC).

The following are excluded from the exemption of the first installment of the Asset Tax (ISA):

  • Legal entities holding real estate that do not carry out commercial activity, whose subscribed and paid capital does not reflect the cadastral value, do not have organized accounting entries or present income tax with operations
  • Large national taxpayers
  • Taxpayers who did not present operations in their ITBIS returns in 2019
  • Taxpayers registered as an investment company

Automatic payment agreement for taxpayers who do not qualify for the exemption of the first installment of the Asset Tax (ISA).

Asset tax (ISA) payment agreement:

A payment agreement applicable to the first installment of the ISA of fiscal year 2020 is granted, in order to pay three (3) equal and consecutive installments beginning on August 31, 2020.

This document contains general information on the subject of reference. Its purpose is merely informative and therefore does not constitute a legal opinion of Franco. It is recommended to seek legal advice for each particular case.