Act 20

Act 20 was created by the government of Puerto Rico to promote business on the island by establishing tax incentives for businesses, and promoting the services of Puerto Rico businesses. The Act also promotes investment in the research and development for private businesses and universities. Finally, the law also gave discounted energy costs for businesses that moved to Puerto Rico, allowing them to be more profitable and efficient.

  • 100% exemption on property taxes
  • 100% tax exemption on profit distributions
  • 100% tax exemption on dividends
  • 4% corporate tax rate

What Makes You Eligible?

Here is a list of the most popular business activities, markets, services and products that allow you to receive the tax exemptions and business incentives that Act 20 provides:

  • research and development
  • advertising
  • public relations
  • consulting services
  • graphic design
  • architectural services
  • engineering services
  • software development
  • call centers
  • telecommunications
  • medical services
  • laboratory services
  • investment banking
  • much, much more

What Type of Tax Exemptions?

Puerto Rico is trying to entice service related industries that help bolster their manufacturing rich economy. Puerto Rico is looking for advertising firms, accounting firms, hedge funds and wide ranges of consulting firms. Here are the benefits of Act 20:

  • 4% fixed income tax rate
  • 3% fixed income tax rate for services that are considered vital for Puerto Rico’s economy
  • 100% tax exemption on distributions
  • 90% tax exemption on personal property taxes
  • 60% tax exemption on municipal taxes
What Are the Steps?

See If You Qualify

Take one-minute to answer a few questions to see if you qualify for our complimentary, comprehensive tax analysis.   It’s completely risk free, you have nothing to lose.