International Business in Dominican

gilbert · #1 11-19-2003, 06:47 PM

After reading posts for the past few hours it seems that there is a lot of talk of the difficulties of operating a business in the DR. Including operating a internet page in the DR. My question is, are there any obstacles of operating an international business on the internet. For example, a mail order business offering products to customers mainly in the United States and shipping those products from contacts in the USA. Two main requirements would be fast internet and low telephone rates. One may ask why not operate the USA based business in the USA? For reasons such as costs of living, taxes, and the fact that you can be sued for looking outside your window all play an important role. I would appreciate any comments

ERICKXSON · #2 11-19-2003, 09:40 PM

Gilbert is easy get your web space a DSL account a Vonage phone account and wallah, hey are you going to sell counterfeit purses? or what?

gilbert · #3 11-19-2003, 09:52 PM

No computer parts

Do I have to pay taxes in Canada (where I am a citizen) or in the Domincan? If I become a resident of the dominican

kraiosis · #4 11-21-2003, 03:51 AM

You dont need to pay taxes in DR if you want to sell parts even opening a office in the island.. only if you register your name or company name on our RNC (National Company Record) you will have to pay taxes other way no at all

...

gilbert · #5 11-21-2003, 08:52 AM

So I should operate my business without registering it?

gilbert · #6 11-21-2003, 08:54 AM

Also I thought that you can operate a business in the DR tax free as long as your not selling to the DR

kraiosis · #7 11-22-2003, 03:34 PM

For example you can have a operatin office of your business to sell or promote services and products to US or Europe via phone or Fax.

kraiosis · #8 11-22-2003, 03:37 PM

other example i have my own company on RD as a freelance for other companies or person thats needs any web or desktop app. i started whiout registering ... now cos im getting big contracts i have to register it. and also to provide services to the mayor communications companies here. visit www.macoris.net o www.macorisnetwork.com

gilbert · #9 11-23-2003, 03:53 PM

Great thanks for the help

dawnwil · #10 11-23-2003, 05:18 PM

Gilbert,

I have been researching this to facilitate a move to the DR; I recently spoke to an accountant on requirements for emigration from Canada.

Residency in the DR does NOT automatically preclude residency in Canada... there are certain steps you must take if you wish to renounce your Canadian residency. These steps culminate in what's known as an official 'Day of Departure'.

You must cut 'residential ties' to Canada, including:

-closing bank accounts & credit cards
-revoking your driver's license
-declaring capital gains on personal assets for Canadian tax purposes-- like real estate other than your official residence, investments, etc.
-filing an income tax return close to the Day of Departure. (In my case, this is likely to be in January of 2004. So if I am in Canada for the first 15 days of January, I will file a special 2004 non-resident return soon after for Jan 1- Jan 15, 2004).

If you hold an investment account with a brokerage firm, you are required to let them know your official Day of Departure so they change the status of your account-- this facilitates higher rates of withholding tax on certain investments (interest, dividends). You will be unable to hold Canadian mutual funds. Withdrawals from an RRSP account will be subject to withholding tax of 25%.

If you do not properly finalize your exit, Canada may still consider you a resident for tax purposes... even if you are a full-time resident of the DR.

In my case, a business I operate in Canada will still be receiving income, so management fees paid to me are subject to a withholding tax of 15%. The company is required by law to withhold this percentage, and there is a specific form to be used. Other types of income... ie. wages... are subject to 25%.

These withholding taxes are considered your 'final commitment to Canadian taxation'.

I looked into 'electing to file a return for non-residents' ... this allows some non-residents to be refunded amounts from the withholding taxes if the amounts withheld are too high. However, if you do elect to file a non-resident return, be aware that you are required to submit your world wide income, upon which a formula is used to ... hee, well... to be sure Canada keeps as much of the withheld tax as possible. I expect for many it's not worth the hassle, although in a retirement situation it might be.

The CCRA website offers some good basic information on the requirements for non-residency. As well, I was advised to ask specific questions of the Intl tax dept to be sure I am following requirements-- this is the only dept with individuals well-versed in specifics.

I am not in Canada at the moment, so do not have access to particulars.

Are you interested in knowing more about this aspect? If so, I will be glad to follow up here with the tax guide numbers and phone number. I plan to return by Dec 6th.

Or, you can visit the CCRA website and research info on non-residency. I also suggest you seek advice from an accountant with experience in this area, as each circumstance is different.

D