Dominica Tax Residency: Here’s Everything You Need to Know

Discover Dominica tax residency benefits in nature’s paradise of the Eastern Caribbean. Learn how acquiring Dominica citizenship by investment can help you eliminate high income tax rates imposed by your overreaching government.

Indeed, offshore tax residency in Dominica by way of the world’s #1 rated citizenship program will enable wealthy families and individuals to protect themselves against tax prejudice and the injustice of populist politics.

Make note that Dominica is also a politically neutral country with no standing military. There is no conscription or compulsory military service for you or your family. The Dominica passport allows you to see the world from a new perspective while enjoying abundant visa free travel benefits.

Find Dominica’s income tax rates below in addition to the procedure for acquiring the tax residency benefits of a beautiful tropical island.  

Discover a Tropical Island Paradise

In Dominica you will discover an idyllic ecotourism destination full of unique natural phenomenon. Additionally, Dominica is home to the best citizenship by investment program in the world. Dominica citizens enjoy global access in addition to no capital gains tax, no inheritance tax and no wealth tax. 

So is Dominica a tax haven? By definition the answer is no, however tax residency benefits can still be found here like buried treasures. All of these attributes are self reinforcing making Dominica the best choice for your offshore tax strategy.

Correspondingly, Dominica citizens have the opportunity to live and invest in a tropical Caribbean paradise. Hence, Dominica citizenship is significantly under valued in comparison with high cost European countries. 

Indeed, Dominica is also an ecotourism splendor with a resident population of sperm whales and scuba diving in deep undersea caverns. Further attributes of Dominica include geothermal hot springs, over 1200 plant species and endemic animal species such as the Sisserou Parrot.

Ecotourists return year after year to benefit the local tourism industry. As a result, your annual ROI on tourism related property steadily increases.

Learn More About Dominica Tax Residency

    1. Dominica Tax Residency Requirements
    2. Establish Dominica Tax Residency
    3. Build Your Nexus to Dominica
    4. Personal Income Tax Rates
    5. Withholding Tax (non residents)
    6. Corporate Income Tax Rates
    7. Value Added Tax
    8. Transfer Tax Rates
    9. Dominica Citizenship by Investment
    10. Tax Residency Benefits

Dominica Tax Residency Requirements

How will you benefit from Dominica tax residency? Formal tax residency can be acquired by residing in the country for a minimum of 183 days during the tax year. As a result, you meet the physical presence requirement and become a tax resident.

As for companies, if the business is registered in Dominica it is considered to be resident for tax purposes. Although if the company is registered overseas but managed and controlled in Dominica it is still considered to be resident for tax purposes.

To be considered a Dominica tax resident may result in some tax obligations to the Dominica government. You may still have the opportunity to eliminate your income tax altogether, if certain conditions apply.  

Dominica may tax global income under certain situations, however Dominica tax residency is still most effective for nonresidents or those exempt from income tax. So proper tax planning is essential, nonetheless Dominica is still an ideal offshore tax solution.

To be clear, Dominica’s local tax law may indeed solidify your offshore tax residency claim. This is especially true if you are prepared to build a solid nexus to the country. As a result, you can get the world’s best tax haven benefits from Dominica.

Edwin Morgan, iGlobal

How to Benefit from Dominica Tax Residency

Dominica citizens who meet the physical presence requirement may become liable for tax on international income. However, nonresidents only pay tax on income sourced from within Dominica. Therefore, Dominica citizens with large international income sources may wish to reside overseas.

To reiterate, Dominica tax law clearly states that tax liability for international income applies to “all individuals who are considered resident”. Since those residing overseas with no local income will be exempt, you who are residing offshore do not need to be concerned about local tax. 

On the other hand, citizens of Dominica who reside overseas can still accrue tax liability in their country of residence or from their country of birth. Yes indeed, your country of residence may still impose their tax laws on you even if you do not hold citizenship there.

Additionally, dual citizenship in countries such as the United States results in global income tax liability, even for nonresidents. Although second citizenship permits you to renounce your original citizenship. As a result, renunciation of US citizenship may be worth considering.   

Build Your Offshore Nexus To Dominica

These supplemental measures work correspondingly with your Dominica property address and can be inserted on offshore bank applications, company registration documents, and of course residency applications. Therefore, with an established nexus to Dominica it is possible to eliminate your global income tax altogether.

So is establishing Dominica tax residency the right decision for you? Review the following tax liabilities and decide if you should live in Dominica for more than 182 days per year. Otherwise, you still can get all the tax haven benefits. However, you need to reside overseas and take the necessary precautions outlined above.

Personal Income Tax Rates

Dominica citizens who meet the physical presence threshold of 183 days are liable for personal income tax on global income. On the other hand, nonresidents are only taxed on locally sourced income.

To clarify, the Dominica Income Tax Act 67:01 stipulates that Dominica tax residents will be liable for tax from certain income sources such as business, partnerships, employment, rentals, royalties, interest, dividends from companies, discounts, premiums, commissions, fees, annuities et cetera.

Since January 1, 2018 Dominica tax residents are allowed a tax allowance of $30,000 East Caribbean Dollars (1 USD = 2.7 XCD). All amounts are in XCD.  This may allow you an exemption for interest or dividends earned from the investment yield on your real estate holdings.

In addition, there is a mortgage interest allowance of up to $25,000. In further benefit, the Dominica government has recently increased the personal income tax thresholds listed here.      

Taxable Income (XCD)
Income Tax Rate
$30,001 – $50,00015%
$50,001 to $80,000  25%
$80,001 and Above
No Capital Gains TaxN/A

Withholding Tax

This 15% withholding tax is applicable when a resident makes a payment to a non resident. However, payments to residents are exempt. Additionally, the person making the payment is responsible for deducting the withholding tax and remitting it to the Comptroller of Inland Revenue.

Payment is due to the government within 15 days after the end of the month in which it was deducted. The withholding tax is applicable to the following income sources:

  • Dividends
  • Interest or Discounts
  • Rental, lease premium or license in relation to movable property
  • Rental of plant, machinery, equipment or other movable property
  • Royalty
  • Management charge
  • Commission or fee, not being in respect of an employment where section 57 applies
  • Annuities or other periodic payment including payments by way of alimony or maintenance
  • Distribution of income of a trust, being income of a kind specified in clauses (a) to (h)
  • Any other payment of an income nature

Corporate Income Tax Rates

The Dominica government taxes resident corporations on worldwide income. However, nonresident corporations are taxed on local income only. Additionally, a company is resident if it is incorporated in Dominica or if incorporated overseas, it is managed and controlled in Dominica.

Taxes are due and payable at the end of every financial year in three quarterly increments. The three quarterly installment payments are tiered at 25%, 35% and 40%. 

Corporate Income Tax Rate25%
Branch Income Tax Rate25%
Branch Remittance Tax Rate15%
Capital Gains TaxNo Capital Gains Tax

Value Added Tax (VAT)

Dominica VAT was introduced in March 2006 and replaced Tax, Sales Tax, Hotel Occupancy Tax and Entertainment Tax. The VAT rate is 15% however it is reduced to 10% for supply sources classified as accommodations and diving activity. Additionally, certain items (mostly necessities) are classed as zero rated items which are exempt. 

The tax is paid by registered producers of supply (goods and services) and it is charged to consumers. Furthermore, imported goods are levied with VAT at port of entry and paid by importers. 

Exempt suppliers of services include financial intermediaries, schools and medical practitioners. Additionally, exempt imports include goods imported by Dominicans returning home for permanent residence. But unconditional gifts to charitable organizations are exempt from VAT. 

Transfer Tax on Sale of Property

Transfer tax (inc. stamp duty) is levied for a conveyance or transfer on sale of any property on Dominica at a rate of 6.5%. The charge is split between the buyer who pays 4% and seller who pays 2.5%.

In addition, there is a judicial fee 2.5% and an assurance fee 1% also paid by the buyer. *Note: the transfer of real estate held by share ownership does not attract transfer taxes. 

Stock or shares of a company are exempt unless the assets of the underlying company are composed of 50% or more of real property. If so, the same stipulated tax rates apply.

For the sale of a Dominica company holding real estate, certain exemptions may apply. Would you like to consult with a local tax expert? 

Transfer Tax (seller)2.5%*
Transfer Tax (buyer)4%*
Judicial Fee (buyer)2.5%*
Assurance Fee (buyer)1%*

*Our real estate trust structure allows the CIP investor to transfer ownership of their unit without attracting transfer taxes. 

Apply for Dominica Citizenship with Tax Residency

Since 1993, the Commonwealth of Dominica has allowed qualified applicants who make a government approved investment into the local economy to obtain Dominica citizenship. In addition, Dominica has always been price competitive offering the highest value.

Indeed, for over 29 years the Dominica government has carefully nurtured the image of their citizenship program. As a result, the CIP has been enormously successful and highly respected.

Local benefits of the CIP have enabled the construction of thousands of climate resistant social housing projects, new schools and medical clinics found in every parish around the island.

In further benefit to the CIP, Dominica has strengthened their ecotourism appeal with 5 star hotels. Not to mention, there is a new intercontinental airport under construction slated for completion in 2025. This synergy is certain to benefit long term real estate investors.

To procure Dominica citizenship, Investors have the option of investing in deeded real estate for US$255,000. Applicants must also complete a thorough background check and submit to a medical exam. If successful, you will receive your passports within 3-4 months.

Dominica Tax Residency Benefits

Investors who qualify for Dominica tax residency through the CIP will also obtain the many benefits of Dominica citizenship. As a result, experience global access and financial freedom like never before.

Whether you are a perpetual traveler, international investor, cryptocurrency millionaire or you just want to renounce your current citizenship, Dominica CIP gives you the security that you need.

Further benefits of Dominica citizenship include:

  • Visa free or visa on arrival to over 144+ destinations.
  • Enjoy the right to live and work in any of the participating CARICOM or OECS countries.
  • No personal interview is required as part of the approval process.
  • In addition, there is no requirement to ever visit Dominica island or reside there to obtain citizenship.
  • No tax on capital gains, wealth or inheritance income.
  • Dual citizenship is allowed with no requirement to renounce your current citizenship.
  • Complete confidentiality is guaranteed since there is no requirement to notify your country or origin.
  • As a citizen of Dominica you are also a citizen of the British Commonwealth.
  • English is the national language with fluency requirements.
  • The Dominica legal system is based on English Common Law.

Choose iGlobal for the Best Offshore Tax Residency

My partners and I have 35+ years of experience helping high net worth individuals lower their tax obligations. Additionally, we are well integrated locally with the real estate developers and government agencies.

iGlobal is indeed well positioned to help you acquire Dominica citizenship in the most expedient manner at the lowest possible cost. Contact me today to acquire global access and financial freedom by way of the Dominica citizenship program.

Contact iGlobal
Edwin Morgan, Managing Director Go Global Corporation PTE LTD