Santo Domingo, Dominican Republic

Retire in the Dominican Republic's Calm Caribbean Atmosphere

Retired life in the Dominican Republic can be easy. The people are welcoming, housing is affordable compared to most developed countries and, with a few exceptions such as imported food and utilities, the cost-of-living is also lower. The beaches aren’t too shabby, either, and moving to another country is always an adventure.

That’s not to say life is perfect. Far from it. Regular blackouts, crime, culture shock, and the usual hassles of living in the developing world make such a move problematic for some. It’s best to do plenty of homework and some serious soul-searching before you make such a move. This advice goes double for pensioners and retirees, who often face their own unique circumstances and considerations.

Visas for Retirees in the Dominican Republic

Any foreign national, retiree or otherwise, wishing to stay in the Dominican Republic longer than the 30 days afforded by a tourist visas will need to apply for residency. The process is a normally a two-step one, involving temporary residency (best applied for at a consulate in your home country) and then permanent residency, which may only be sought while in the country.

Retiring in the Dominican Republic, you are among those eligible to skip the temporary residency and jump right to the permanent residency status provided they can prove access to a monthly pension or similar source of funding of at least US$1,500 per month (plus $250 per dependant). The income must come from a public or private plan and the amount must be certified by the plan provider in writing. This document is in addition to the litany of other paperwork (health certificates, criminal background checks, birth and marriage certificates, etc.) required of any visa applicant.

The government says permanent residency may be acquired within 45 days of application, but in reality the process usually takes longer.

Medicare and Social Security Benefits in the Dominican Republic

Anyone eligible for benefits can continue receiving social security benefits while living in the Dominican Republic. The only exceptions are benefits as a dependent or survivor of a worker, which involve special rules. A tool on the Social Security Administration’s website, the Payments Abroad Screen Tool, can help determine if there are any restrictions that apply to specific situations.

Social Security benefits can be mailed to a residence in the Dominican Republic, though this method is not advised. Best bet is to have the benefits deposited directly into a bank or other financial institution account in the U.S. or in the Dominican Republic (it participates in the Social Security Administration’s International Direct Deposit program). If the benefits are deposited in the United States, recipients may access the money from ATMs throughout the Dominican Republic or have the funds transferred to a local bank

Medicare does not cover health services received outside the United States.

Taxes for Retirees in the Dominican Republic

Anyone who has been resident in the Dominican Republic for at least three years is subject to Dominican taxes. You are considered a resident if you spend more than 182 days in the country during any given fiscal year (the days do not have to be consecutive). Resident foreigners receiving income from financial investments (stocks and bonds, certificates of deposits, etc.) must pay taxes on income from those investments. Pensions and Social Security benefits, however, are exempt. All taxpayers must register with the tax authorities and obtain a tax or RNC (Registro Nacional de Contribuyentes) number.

Tax rates on income from financial investments abroad is levied on a sliding scale, with the first RD$290,000 exempt. Income between RD$290,000 and RD$435,000 is taxed at 15%; income between RD$435,000 and RD$604,000 at 20%. Everything above $604,000 is taxed at 25%. The scale is adjusted for inflation annually in January. There are very few deductions.

A 1% annual tax is assessed on any real property owned by individuals, based on the value of the property as appraised by the government authorities. The 1% is calculated only for values exceeding RD$5 million.

The estate of any person, Dominican or foreign, whose last domicile was in the Dominican Republic is subject to Dominican inheritance taxes of 3% less some deductions (4.5% for people who do not live in the Dominican Republic). The inheritance of property located in the Dominican Republic is subject to Dominican inheritance taxes, irrespective of the nationality or domicile of the deceased

Currently, there is no tax treaty in place between the United States and the Dominican Republic, so taxes may be owed in both countries in certain circumstances. Tax laws are complicated and change frequently, so it is recommended that a qualified tax accountant be consulted.

A City of Many Firsts In The New World

Santo Domingo, the first capital of the Americas and the present day capital of the Dominican Republic, is the largest metropolitan city in the Caribbean with a population of approximately 3 million and an area a little over 40 square miles.  The original capital was destroyed by a hurricane in the early 1500’s and was relocated to its current location on the banks of the Ozama river which has proven beneficial to the city’s economic growth and development.  The city was devastated by yet another hurricane in 1930 which left the city in need of serious repair.  After this rebuilding, it was named Ciudad Trujillo after Dictator Rafael Trujillo, who was later assassinated in 1961.  The city went back to its original name.

There is a sizable immigrant community in Santo Domingo made up in large part of Haitians who have crossed the border of the island Haiti shares with the Dominican Republic in search of jobs and opportunities.  Recent years have seen an influx of other immigrants from the Middle East, Europe, Asia, Venezuela and Puerto Rico.  U.S. born Dominicans are also returning to their parents’ home country and bringing with them the experiences and skills learned abroad.

The middle class in Santo Domingo is growing rapidly however there is still a high percentage of people living in poverty in the growing capital and across the nation.

Santo Domingo has both an elevated and a subterranean metro system.  This transportation system is still under construction and according to plans should have a total of six lines when completed.  In the city, taxis, be they car or motorcycle, are common forms of transportation.  The capital city has two international airports.

The Zona Colonial in Santo Domingo, a vibrant neighborhood with colorful buildings and cobblestone streets, is a popular spot for locals and tourists and has been named a World Heritage Site by UNESCO as the oldest settlement of the New World.  Zona Colonial is the main tourist attraction in Santo Domingo with its old buildings dating back farther than anything back in the United States.  In the Zona Colonial lies the Monasterio de San Francisco, a monastery built in 1508 which was, over the years, ruined by pirates and natural disasters.  The ruins are now used as a backdrop for social and cultural events which draw quite the crowds.

The Port of Santo Domingo has seen its fair share of drama with pirates and weather causing havoc but since its inception it was a crucial port in the Caribbean.  Recently, millions of dollars have been invested in the Port of Santo Domingo, at the mouth of the Ozama River, to unite it with the Zona Colonial and create a world-class hub attracting cruise ships and yachts.

Santo Domingo has become a hotspot for call centers in the area due to its close ties and proximity to the United States.  Salaries are not particularly high by U.S. standards but still provide a decent amount of jobs in the city. 

The island’s capital is just a quick 30-60 minute drive away from breath-taking Caribbean beaches  with postcard-worthy crystal clear water and white sand.  A day spent in Boca Chica or Juan Dolio beaches could be a great way to relax, have a great meal and recharge before heading back to the busy city.  Once you get there though, you may want to spend the night…or the whole weekend.

Santo Domingo is a large city with deep historical roots and an ever-evolving modern infrastructure with most everything you would expect to find in a capital.  Shopping malls, restaurants and bars, universities, movie theaters, a national theater and symphony all offering the amenities people living in a city crave but, keep I mind, it is still located on an island.  You should expect things to take a little longer than you would prefer, expect the day to day pace to be a little bit slower.  Patience is a virtue, remember the reasons why you chose this haven in the first place and take advantage of all it has to offer.

Monthly Budget For A Couple Living In Santo Domingo, Dominican Republic

Expense Monthly Cost
Rent DOP 30,000
Electricity (with a/c) DOP 2,755
Water DOP 230
Transportation DOP 3,000
Telephone (includes internet and cable) DOP 2,400
Groceries DOP 20,000
Entertainment DOP 11,850
Total DOP 70,235

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