If you plan to do business in the Dominican Republic, it is important to understand the different business structures available to you. Choosing the right structure will determine your personal responsibility, tax obligations, and how you will operate.
Here are the four common business structures in the Dominican Republic:
1. EIRL (Enterprise Individual Limited Liability): An EIRL is the simplest structure for one-person businesses. It ensures a separation between personal and business assets.
2. SRL (Limited Liability Company or SRL): This structure is popular among local and foreign investors. It requires a minimum of two partners who are not personally liable for the company’s debts. An SRL provides personal asset protection and is suitable for medium-sized businesses.
3. SA (Sociedad Anónima) – This structure is similar to a C-Corp in the United States. It requires a minimum of seven shareholders and is suitable for large companies. Shareholders’ liability is limited to their investment.
4. SAS (Simplified Joint Stock Company) – A SAS combines features of an LLC and an SA. It requires a minimum of two shareholders and offers flexibility in management. Like an SA, the shareholders’ liability is limited. The SAS is appropriate for larger companies or those planning to go public.
Before establishing a company in the Dominican Republic, I recommend consulting a specialized lawyer to determine the best structure for your needs and reduce tax liability.