How to Qualify for the 4% Corporate Tax Rate Under Act 60

If you're an entrepreneur or business owner providing services remotely, Puerto Rico’s Act 60 Export Services Incentive could reduce your corporate tax rate to just 4%. This powerful incentive has attracted consultants, software developers, fund managers, and agencies from around the world.

But qualifying isn’t automatic—you’ll need to meet strict criteria and maintain ongoing compliance.

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What Is the Export Services Incentive?

The Export Services Incentive under Act 60 (formerly Act 20) is designed to attract service-based businesses to operate from Puerto Rico while selling to clients outside the island. Qualifying businesses are taxed at just 4% on eligible income, with additional exemptions on dividends and municipal taxes.

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Who Qualifies?

Your business must:

- Be organized and headquartered in Puerto Rico.

- Provide eligible services to clients located outside Puerto Rico

- Apply for and receive an Act 60 decree from the Puerto Rico Department of Economic Development and Commerce (DDEC)

- Maintain proper books and records, and meet annual filing and reporting obligations

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‍What Services Qualify?

Here are some of the most common eligible services under Act 60:

• Consulting and advisory services (legal, tax, finance, management, etc.)
• Creative and digital services (marketing, design, animation, software)
• Investment and asset management
• Accounting and auditing
• Call centers, BPOs, and remote support
• Research and development
• Trading companies

Important: All services must be rendered from Puerto Rico and to clients outside Puerto Rico.

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How the Tax Benefits Work

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Location Strategy: Why Dorado Makes a Difference

If you register your company in Dorado, you could receive an additional 50% municipal tax exemption, thanks to Ordinance 47. When combined with the standard Act 60 exemption, this can reduce your Volume of Business tax by up to 75%.

👉 Many clients use Bee House LLC, a virtual office located in Dorado, to meet Act 60 requirements while maximizing savings and maintaining a prestigious address.

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Key Compliance Requirements

To keep your 4% rate active, you must:

• File the Exempt Annual Report with DDEC
• Maintain good standing with the Department of State and Treasury
• Submit audited financial statements (if required)
• Renew local business permits annually
• Operate with economic substance in Puerto Rico

Tip: We recommend hiring a local CPA familiar with Act 60 for ongoing support.

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Common Mistakes to Avoid

• Operating from the U.S. mainland instead of Puerto Rico
• Failing to prove services are for offshore clients
• Missing annual DDEC filings
• Not maintaining a valid office address or permit

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Ready to Set Up Your Act 60 Business?

At Imperium Management Group, we help clients form Act 60 corporations, apply for the decree, and maintain full tax compliance. We also offer virtual office services in Dorado that unlock municipal tax savings.

👉 Schedule a call to get started with your 4% export services strategy.

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