Your Guide to the CONFOTUR Tax Exemption at Andara

As a CONFOTUR-approved development, Andara Cap Cana offers significant tax benefits to its first buyers under Dominican Republic Law 158-01. This includes a full exemption from the 3% property transfer tax at the time of purchase and an exemption from the annual 1% property tax (IPI) for a period set by the law for the project. These incentives are designed to encourage tourism investment and can substantially improve the financial profile of owning a residence at Andara.

What tax is waived when I purchase my condo at Andara?

The most immediate financial benefit of Andara's CONFOTUR status is the exemption from the property transfer tax. In a standard real estate transaction in the Dominican Republic, a 3% tax is levied on the value of the property when the title is transferred to a new owner. For a buyer at Andara, this tax is completely waived.

This exemption applies only to the first purchase directly from the developer, Onix Living. It is a one-time saving that reduces your closing costs. Because Andara is a new, pre-construction community delivering in Q4 2028, every initial buyer qualifies for this benefit, provided the correct legal steps are taken to register it.

How does the annual property tax (IPI) exemption work?

The second major benefit relates to the annual property tax, known as IPI (Impuesto al Patrimonio Inmobiliario). This is a 1% tax levied annually by the Dominican government. Crucially, the tax is not applied to the entire value of a property; it is only charged on the value that exceeds an annually-adjusted exempt threshold. For properties valued below this threshold, no IPI is due.

Law 158-01, the CONFOTUR law, grants a fifteen-year IPI exemption to qualifying tourism projects like Andara. This means the project itself is exempt for that term. For an individual owner, the application of this benefit must be confirmed by their Dominican attorney, who will ensure the exemption is correctly filed and recorded on the property's title. This is a significant advantage, particularly for higher-value residences like the two- and three-bedroom homes at Andara, which range from 1,207 to 2,912 square feet.

What does CONFOTUR cover, and what is taxed separately?

It is essential for investors to understand the scope of the CONFOTUR law. What is sourced is what it exempts: the property transfer tax and the annual IPI. Rental income is taxed separately, under its own rules, and a buyer's attorney is the right person to confirm how the two interact in a particular case.

If you choose to rent out your Andara residence through the optional managed rental program or on your own, that income falls under Dominican rental taxation. For non-resident owners, this typically means a 27% withholding on gross rental income — charged on the gross figure with no deductions for expenses, so it is not a tax on profit. Short-term tourist rentals are also subject to the 18% ITBIS (the Dominican VAT), and the host is liable for it, not the booking platform. Rates and rules change; confirm the current position with your attorney and accountant before modelling a net return. The CONFOTUR exemptions reduce your property holding costs — they are property-tax exemptions and should not be read as improving the tax treatment of rent.

Is the CONFOTUR exemption automatic?

No, the benefits are not applied automatically upon purchase. An owner must proactively file for the exemption through their legal representative in the Dominican Republic. This is a standard part of the closing process for a new-build, CONFOTUR-approved property, but it is a critical step that cannot be overlooked. Your attorney handles this process to ensure the tax exemptions are properly registered with the Dominican tax authority (DGII) and recorded on your official title deed.

1. Confirm Andara's CONFOTUR Status
   Your purchase agreement will reference the project's approval under Law 158-01. Andara, as a new 175-unit community in Cap Cana, is a qualifying project.
2. Engage a Dominican Attorney
   A local real estate attorney is essential to handle the title transfer and tax filings. They will prepare and submit the application for your exemptions.
3. File for Exemption
   Your attorney files the necessary paperwork with the DGII, formally requesting the application of the transfer tax and IPI exemptions to your specific unit.
4. Receive Registered Title
   The final step is the issuance of your title deed, which will have the CONFOTUR exemptions officially recorded, securing your tax benefits.

Who is eligible for these tax benefits at Andara?

The CONFOTUR law is very specific about eligibility: the tax exemptions are granted only to the first acquirers of a property within a qualified development. This means that if you buy a condo at Andara directly from the developer, Onix Living, you are eligible. Residences start from $280,600.

However, if you later sell your condo, the subsequent buyer will not receive these CONFOTUR benefits. They will be required to pay the 3% transfer tax, and the property will become subject to the annual 1% IPI (if its value is above the exempt threshold). This is an important consideration for long-term financial planning and understanding the resale market.

Common questions

How long do the CONFOTUR tax exemptions last?

The exemption from the 3% property transfer tax is a one-time benefit at the moment of purchase. The law provides for a fifteen-year exemption from the annual 1% property tax (IPI) for the project. Your attorney will confirm how this applies to your specific property upon filing.

Does CONFOTUR reduce my capital gains tax if I sell my Andara condo?

CONFOTUR's exemptions, as sourced, are the 3% property transfer tax and the annual IPI. A gain realised on a later resale falls under separate Dominican rules rather than under these exemptions, so treat a resale as its own tax question and put it to your attorney and accountant before you sell.

Is Andara the only project in Cap Cana with CONFOTUR status?

No, CONFOTUR approval is common for new tourism-focused developments in major resort areas like Cap Cana. This status is a key reason the area is attractive to international buyers. Andara's approval means the project qualifies under the same law as those developments; how the incentives apply to a particular unit and owner is confirmed at closing by the buyer's attorney.