ITBI and All the Actual Costs of Buying a Property in the Dominican Republic

The real estate transfer tax (ITBI) is 3% of the registered value, according to the DGII. Find out all the actual costs of buying property in the Dominican Republic.

The real estate transfer tax (ITBI) in the Dominican Republic is equal to 3% of the property’s registered value, according to the General Directorate of Internal Revenue (DGII), and is paid only once, when the title is transferred to your name. But the ITBI is not the only cost involved in closing a purchase: added to that amount are legal fees (approximately 1%–1.5% of the value, depending on the law firm), notary fees to legalize the sales contract, and title registration fees with the Real Estate Registry, in accordance with Law 108-05. If the project has Confotur certification under Law 158-01, the ITBI may be fully or partially exempt, which changes the closing budget. In total, including taxes, fees, and registration, you should plan for an additional 4% to 6% of the property’s price, although the exact figure depends on each project and should be confirmed with your attorney.

What is the real estate transfer tax (ITBI), and how much do you have to pay?

The ITBI (real estate transfer tax) is the tax paid when a property changes hands in the Dominican Republic. According to the General Directorate of Internal Revenue (DGII), the standard rate is 3% of the property’s registered value—not the price you negotiated with the developer or the market value. This registered value is typically determined by the General Directorate of the National Cadastre, and in practice, it may differ slightly from the sale price.

The ITBI is paid only once, at the time the title to the property is transferred to your name; it is not an annual or recurring tax. It differs from the IPI (Real Estate Property Tax), which is annual and applies only to properties that exceed a certain value threshold. Confusing these two taxes is one of the most common mistakes we see among buyers coming from abroad.

If you purchase a property in a Confotur-certified project, this 3% tax may be fully or partially waived, depending on the project’s decree. Below, we explain how to verify this before signing.

All the Actual Costs of Buying a Property in the Dominican Republic

A property's list price is just the starting point. At the closing of the purchase, several additional charges are added, each with its own percentage or cost, and each paid to a different entity at a different stage of the process. This table summarizes the main ones:

As you can see, the ITBI is usually the most obvious cost because it’s a fixed, known percentage, but it’s not the only one. When you add in legal fees, notary fees, and registration fees, it’s realistic to budget an additional 4% to 6% of the property’s price to close the purchase without any surprises.

How much do lawyers charge in legal fees?

This is where budgets vary the most from one buyer to another. Legal fees for a real estate purchase in the Dominican Republic are generally around 1% to 1.5% of the property’s value, but this figure is neither fixed nor uniformly regulated: each law firm sets its own rates, which may depend on the complexity of the case, whether you’re purchasing remotely, and whether the attorney also handles title registration and review of the sales contract.

What this fee typically covers:

• Review and negotiation of the purchase or reservation agreement.
• Verification that the title is free of encumbrances with the Real Estate Registry.
• Handling the payment of the ITBI to the DGII and the registration of the new title.
• Confirmation of the project's Confotur rating, if applicable.

Before hiring a lawyer, always ask for a written quote. There is no single, definitive figure for legal fees: each law firm sets its own rates, and confirming the fee before moving forward will help you avoid surprises at the end of the process.

Can I pay less ITBI? The Confotur Exemption

Yes, it is possible, but it depends on whether the specific project has a valid Confotur designation. Law 158-01 on the Promotion of Tourism Development, administered by the Council for Tourism Promotion (MITUR), exempts projects approved by decree from the ITBI, along with other tax benefits such as the annual IPI and import duties on construction materials.

Not all projects in Punta Cana, Bávaro, or Cap Cana have this designation: it depends on whether the developer applied for it and the government approved it for that particular development. Therefore, before assuming that the ITBI will be waived, ask for the decree number that confirms it. If you want to understand in detail how this benefit works, how much it can save you, and what questions to ask before signing, you can read our comprehensive guide on the Confotur Law and how much you can actually save.

An important point: even if the project qualifies for Confotur and the ITBI is waived, legal fees, notary fees, and title registration fees still apply. The waiver reduces one of the closing costs, but not all of them.

Real-life example: closing costs based on your investment amount

To give you a concrete example, here’s how the ITBI applies to various properties in our current portfolio in Punta Cana, Bávaro, and Cap Cana, assuming the project does NOT qualify for the Confotur exemption (keep in mind that this amount is in addition to legal, notary, and registration fees):

• The Plaza (US$109,850, commercial property, Downtown Punta Cana): Estimated ITBI without exemption, 3% = US$3,295.50.
• Level Business Center (US$171,600, Cap Cana): Approximate ITBI without exemption, 3% = US$5,148.
• Makai Residences (US$326,000, Cap Cana): Estimated ITBI without exemption, 3% = US$9,780.

Legal fees (approximately 1%–1.5%) and notary and registration fees must be added to each of these figures. Using Level Business Center (US$171,600) as a reference, the ITBI comes to around US$5,148, and adding an estimated 1.5% in legal fees (US$2,574) plus notary and registration fees, the total additional cost on top of the list price could be approximately 5%, always subject to confirmation with your attorney and the project’s Confotur decree, if applicable. If the project has Confotur approval, the ITBI from the list above could be reduced to zero, but this can only be confirmed by reviewing the specific project’s decree—not based on the developer’s name or the area. This type of calculation is part of what we review with you when you’re exploring investing in Punta Cana with us, so that you reach closing with a complete budget—not just the list price.

Do you need to be in the Dominican Republic to pay these fees and sign the documents?

This is one of the most common questions among buyers living in the United States, Canada, or Europe. In practice, most of these procedures can be handled without you having to travel for each signature: your attorney can act on your behalf through a duly notarized power of attorney, and many payments (including the ITBI) are coordinated through bank transfers and procedures that your law firm handles directly with the DGII and the Real Estate Registry.

That said, not all law firms or projects handle the process the same way, and the exact format of the power of attorney (whether it’s granted in your home country or locally) depends on your specific situation. Before committing to your initial deposit, check with your attorney to confirm which procedures require your physical presence and which can be handled remotely. This is one of the first questions we address with you when you purchase through our portfolio, whether at Coral Golf Resort, Cap Cana, or Downtown Punta Cana.

When are the various costs paid during the purchase process?

Understanding the order in which these charges are processed helps you plan your cash flow, especially if you're shopping online. Generally speaking, the process follows this sequence:

1. Signing the reservation agreement or letter of intent to sell: At this point, you typically pay an initial deposit, and this is the time to confirm with your attorney whether the project has Confotur approval and what your attorney’s fee will be.
2. During construction (if it’s a presale): scheduled payments based on the construction timeline; no ITBI is due yet because the title has not yet been transferred.
3. Delivery and transfer of title: This is where the ITBI is calculated and paid to the DGII (or the Confotur exemption is applied, if applicable).
4. Title Registration: Once the ITBI tax has been paid, the title is registered in your name with the Real Estate Registry, in accordance with Law 108-05, and the corresponding registration fees are paid.
5. Legal closing: Your attorney bills you for their fees, usually at this point or spread out over the course of the process, depending on what you have agreed to in writing.

Common Mistakes When Estimating the Total Cost of Your Purchase

These are the mistakes we see most often among foreign buyers arriving in Punta Cana, Bávaro, or Cap Cana:

• Calculate the ITBI based on the negotiated sale price, rather than the registered value determined by the National Cadastral Registry.
• Assuming that the ITBI is exempt simply because the project is located in a tourist area, without verifying the specific Confotur decree.
• Do not budget legal fees separately; instead, treat them as a minor expense or one that is included “by default.”
• Confusing the ITBI (one-time transfer tax) with the IPI (annual property tax).
• Failing to request a written estimate of legal fees before hiring a lawyer.
• Exclude the title registration fee from the total calculation, assuming it is already included in the ITBI.

Checklist Before Signing Your Purchase Agreement

If you're about to buy a home and want to close the deal without going over budget, here's what you should confirm before signing:

• The property's registered value with the National Cadastral Registry, which serves as the basis for calculating the 3% ITBI tax.
• Does the project have a current Confotur decree, and what exemptions does it cover exactly?
• A written estimate of your attorney's legal fees, specifying which services are included.
• Estimated costs for notary services and title registration with the Real Estate Registry (Law 108-05).
• The project's complete payment schedule, so you can see at which stage each item is paid.

At Garrigó Real Estate, we go over this checklist with you before you reserve a unit in any of the projects in our portfolio, so that the closing costs are clear from day one.

Frequently Asked Questions About ITBI and the Costs of Buying Property in the Dominican Republic

How much is the ITBI in the Dominican Republic?

According to the DGII, the ITBI is equal to 3% of the property's registered value and is paid only once, when the title is transferred to your name.

Is the ITBI tax calculated based on the sale price or some other value?

It is calculated based on the property's registered value, as determined by the National Cadastral Registry, which may differ from the sale price agreed upon with the developer.

What other costs, besides the ITBI, should I factor into my budget?

Primarily legal fees (approximately 1%–1.5%, depending on the law firm), notary fees, and title registration fees with the Real Estate Registry.

Are all projects in Punta Cana exempt from ITBI?

No. Only projects with a valid Confotur designation, approved by decree under Law 158-01, are eligible for a total or partial exemption from the ITBI.

Is the ITBI the same as the IPI?

No. The ITBI is paid only once upon transfer of title. The IPI is an annual tax levied on properties that exceed a certain value threshold, and it may also be exempted if the project has Confotur approval.

How much should I budget for in total, in addition to the price of the property?

As a general guideline, when factoring in the ITBI tax (if there is no Confotur exemption), legal fees, notary fees, and registration fees, a reasonable range is an additional 4% to 6% of the list price. The exact amount depends on the project, the law firm you hire, and whether any exemptions apply, so you should always confirm this before signing the reservation contract.

At Garrigó Real Estate, we're with you every step of the way, from choosing a project to the transfer of title.

Let's talk about your next investment, or message us directly on WhatsApp.