The Dominican Republic

Your Money

When you retire to a new country it is likely that your source of income will be either from whence you have come or from a third country or both of these possibilities. This is particularly the case if you have worked in a number of countries and had different employers in at least two countries. It is vital now that you are able to access your funds easily and at the lowest possible cost.

Administering your funds in The Dominican Republic does have aspects peculiar to this country. The list of banks provided here is not necessarily currently correct although it is historically accurate. The only foreign bank with retail outlets in The Dominican Republic is the Scotia Bank. The control of banks and the accounting profession as a whole is still a work in progress as a World Bank report dated August 2009 indicates. There have been problems in the banking industry in the Dominican Republic but enhanced legislation has improved the situation to the extent that further difficulties are not expected. The Government’s bank is the Central Bank of The Dominican Republic and, interestingly its site is in English. Daily spot exchange rates of convertible currencies are given at this site. This Central Bank’s site also provides much economic news and information.

It is important as always not to have all of one’s eggs in one basket. Offshore bank accounts in jurisdictions with which you are familiar and which you trust are the best safeguard for your wealth other than as jewelry and precious metals safely stored. The currency in the Dominican Republic is the “Peso” and the exchange rate is about 40 Pesos to the U.S. Dollar. It is easy to exchange dollars for Pesos but the reverse is more difficult and much more expensive. All banks and ATMs will allow withdrawals from US dollar accounts overseas but the funds provided will be in Pesos. At machines there is often a daily limit of about US$300. There is plenty of advice available on managing money in the Dominican Republic. There are no exchange controls in the Dominican Republic but the currencies which can be easily converted into Pesos is limited.

The Government of The Dominican Republic is curently negotiating an agreement with the U.S.A. with respect to the Foreign Account Tax Compliance Act. This will have repercussions for U.S. citizens living in the country.

Opening a bank account in The Dominican Republic is not difficult. No residential status is necessary. Foreigner need only show a valid and current passport although a letter of recommendation from your overseas bank can be useful. The minimum deposit is usually only 5000 pesos or US$500. Interest rates have been very good in the Republic especially for Pesos accounts. There may be a language problem. At locations other than major tourist resorts and towns it is likely that Spanish will be the only means of communication.

The links at the "Resources" tab of this site and the book "How to Retire in The Dominican Repulic" by Les Johns will amplify the information given above. The book can be bought from this site directly.

Pensions

Almost all of the comments in the Australian section on this subject are relevant to the Dominican Republic. The use of offshore bank accounts will be essential to make the most of your funds and to achieve flexibility in income arrangements. This is no different from any other country to which one may retire.

Other Income

As a retiree it is unlikely that local income will be derived by you. Residents who are in possession of residency visas can take up local employment in The Dominican Republic but it is more likely that all income will be derived abroad by retirees. There are, of course, tax benefits to deriving offshore income which may not apply to local earnings. The use of offshore bank accounts is essential in receiving overseas income. As with the section on "Pensions" above the corresponding Australian section is also applicable to the Dominican Republic

The links at the "Resources" tab on this site together with information in the book "How to Retire in The Dominican Republic" by Les Johns will provide more detail on these matters.