- Act 20 – Individual Investors Act.
- Act 22 – The Act to Promote the Transfer of Investors to Puerto Rico.
- Act 273 – Economic Incentives for the Development of Puerto Rico Act.
1. Area Orientation:
- Accompanied area overview
- Area information
- Property overviews
- Schooling overview
- Every day living advice
Area Orientation Tour : Benefits
- Helps to sell the location to the prospective relocating employee.
- Identifies key considerations at an early stage to reduce the overall cost of the relocation.
- Expert advice and assistance to help your relocating employees make informed decisions.
2. Temporary Housing:
- Sourcing temporary housing based on relocating employee’s criteria
- Booking of temporary housing
- Arrangement of temporary housing viewings
- Lease negotiation and review
- Inventory check in
- o Inventory check out
Temporary Housing : Benefits
- Compliance to your policy on the number of eligible days
- Fast and flexible solution
- Reduces costly hotel related expenses
3. Home Findings:
o Conduct needs analysis with the relocating employee prior to the visit
o Provide welcome pack and local area information
o Prepared itinerary of properties
o Meet and greet with the employee prior to conducting the home finding tour
o Accompanied visits to properties
o Lease negotiation
o Inventory check in
Home Finding : Benefits
o Service delivered by home finding professionals with expert local market knowledge
o Professional inventory clerks
o Local intelligence and ongoing consultation to benefit your policy
o Independent market advice on local systems
o Ensures lease terms are negotiated to the employee’s understanding
4. School Search:
o Detailed school search needs analysis
o Set up interviews with schools
o Assist with registration
o School search comparisons
School Search : Benefits
o Independent advice by education professionals
o School search delivered by school search professionals with expert local knowledge and education experience
o Local intelligence and ongoing consultation to benefit your policy
5. Setteling Assistance:
o Banking services
o Neighbourhood area orientation tour
o Utility and broadband connection
o Auto purchase/lease assistance
o Health care system overview
o Automotive and property insurances
o Driver’s licence and car registration
o Furniture rental
o Assistance in locating doctors, shopping, houses of worship and speciality foods
o Translation services
Relocation Settling-in Assistance : Benefits
o Flexible and built around your relocating employee’s needs
o Reduces anxiety and the time it takes to settle-in
o Can be easily combined with the home finding
o Cost effective
6. Tenancy Management:
o Lease negotiation and renewal
o Arrange payment of deposits
o Utility connections
o Payment of ongoing utility bills
o Inventory check in and check out
o Dilapidation control
o Notification of lease renewal
o Recovery of security deposit
Relocation Tenancy Management : Benefits
o Reduces administrative demands on your department and your relocating employee
o Ensures the happiness of your relocating employees
o Increases recovery of deposits
o Manages payments and reduces costs
Before purchasing a one-way ticket to the island, there is a lot that you need to know before you arrive. Here are some basics to get you started.
SHIPPING A CAR
When considering transporting automobiles, furniture and other large household items over land and sea, remember that it may be more economical to sell certain items than it is to ship them — for instance, older cars valued at less than a thousand dollars.
Shipping a car or household items usually takes from 7 to 14 days, assuming that the request was received at least a 1 to 2 week in advance. Check with your local marines cargo company or an authorized trucking company for schedules and prices.
In addition, contact the Office of Excise Taxes at (787) 721-6237 or (787) 721-0338 in Puerto Rico to obtain an approximate amount for the excise tax you will need to pay to bring your vehicle to the island. You will need to provide vehicle information: make, model, year, automatic/standard, and number of doors.
License plates are not transferable. License stickers are renewed every year at which time you will have to pay $35 annual fee for no fault insurance and $65 for annual registration. For more information contact the Departamento de Transportación y Obras Publicas (www.dtop.gov.pr) at (800) 981-3021 or (787) 729-2929.
Housing prices in Puerto Rico are comparable to Miami or Los Angeles, but property taxes are considerably lower than most places in the US. The real estate market in Puerto Rico is booming due to population growth.
Titles, Deeds and Land Records
Land records are available through the Registros de la Propiedad. There are 29 offices that serve specific municipalities, neighborhoods or sectors. To obtain information from these records it is usually necessary to know the name of the purchaser, the approximate date of purchase and the city in which the land was then located. To obtain certified copies write to or call:
Registro de la Propiedad
Oficina de la Directora Administrativa
Departamento de Justicia, Piso 3
Calle Olimpo, Esq. Axtmayer
Miramar, San Juan, PR 00907
P.O. Box 9020192
San Juan, Puerto Rico 00902-0192
FINDING WORK IN PUERTO RICO
If you do not have a job, before you have arrived, make sure you have done your resume (curriculum vitae) and that you have copies of all relevant documentation, such as up to date references. For applicants of 18 years or more; some employers may require a Certificate of Good Behavior/Certificate of No Criminal Conviction (PDF), which is issued by the Puerto Rico Police Department.
There are different methods to find a job in Puerto Rico. Here are a few tips:
- Ask for job leads from: family members, friends, people in the community, and staff at career centers.
- Knock on the doors of any employers, factories, or offices that interest you, whether or not they have vacancies.
- Use the Yellow Pages to identify areas that interest you in or near the town or city where you live and then call the employers in that field to find out whether they are hiring for the position that you can do — and do well.
What Color Is Your Parachute? 2003: A Practical Manual for Job-Hunters and Career Changersby Richard Nelson Bolles
You can also find lots of job offers in newspapers, specialist magazines and on the Internet. Although you may find a job through one of the many Internet job search sites, the best use of the Internet is to research companies you may want to work for.
If you’re looking for employment in Puerto Rico, these web sites can help you in your job search.
How to obtain a Certificate of Good Behavior/Certificate of No Criminal Conviction?
You may request a certificate by completing the Certificate of No Criminal Conviction application (PDF). You must also include a postal money order in the amount of $1.50 made out to: Secretario de Hacienda. Send the money order and letter to:
Servicios al Ciudadano
Policia de Puerto Rico
P.O. Box 70166
San Juan, PR 00936-8166
For more information call (787) 781-0227.
Puerto Rico’s overall literacy rate of 90 percent and its budget for education is approximately 40 percent. Education is obligatory between 6 to 17 years old. Primary school consists of six grades; the secondary levels is divided into 2 cycles of 3 years each. The school term in public schools starts in August through mid-December and January through late May.
The Department of Education oversees the public education system. The language used in the schools is Spanish, however, English is taught from kindergarten to high school as part of the school curriculum. Some private schools provides English programs where all classes are conducted in English except for the Spanish class.
There are also several colleges and universities available throughout the island, including: University of Puerto Rico, Interamerican University of Puerto Rico, among others.
UTILITIES, NEWSPAPERS & COMMUNICATIONS
The general rule in Puerto Rico is United Standards 110 and 120 volts AC, and the outlets take the same two-prong plugs found in the United States.
Electrical service is provided by the Puerto Rico Electrical Power Authority (PREPA) (“Autoridad de Energía Eléctrica”) (www.aeepr.com), the second largest government owned utility in the U.S., with assets of $3.5 billion in 1995. It is also the only supplier of electricity in Puerto Rico. Electricity bills are to be paid every month.
For more information contact the Customer Services Center at: (787) 289-3434, outside the metro area 1-800-981-2434 or visit the nearest office.
New generators are being built to keep up with the demand by adding almost 1,500 megawatts of capacity by 2001. Expansion is part of a five year, $1.6 billion capital improvement program. Two private co-generating plants are under construction. The first, a $600 million facility, broke ground in March of 1998.
– Electric voltage 110V, 60-CYCLES, AC
– Capacity 5,040,000 kW.
– Production 16.1 billion kWh.
– Consumption per capita 4,260 kWh (1992).
WATER & SEWAGE
The island is served by Puerto Rico Aqueduct and Sewer Authority’s (PRASA) (www.acueductospr.com) (“Autoridad de Acueductos y Alcantarillados”) extensive system of over 10,000 miles of water mains and aqueducts and 2,000 miles of sewage lines. Puerto Rico’s water quality is subject to the same regulated EPA standards that apply on the U.S. mainland. A private company, Professional Services Group, manages and operates PRASA’s system. Tap water is considered safe to drink. Milk is pasteurized and dairy products are safe for consumption. Local meat, poultry, seafood, fruit and vegetables are generally considered safe to eat.
For more information contact Autoridad de Acueductos y Alcantarillados Customer Service at: (787) 620-2482.
Natural gas is delivered by the cylinder. Many Puerto Ricans use natural gas propane stoves instead of electric stoves. Propane cylinders can be obtained from a local propane gas supplier.
Puerto Rico has over 32 landfills and waste-burning facilities.
As with electricity and water, the only supplier of garbage disposal is the government-run company called Autoridad de Desperdicios Solidos (www.ads.gobierno.pr), known as ADS.
For more information call the main office at: (787) 765-7575 or or contact the nearest office (PDF).
U.S. by high capacity submarine cable and INTELSAT with high-speed data capability; digital telephone system with about 1 million lines; cellular telephone service; broadcast stations – 50 AM, 63 FM, 9 TV; cable television carries all four major U.S. networks. The first local radio broadcast dating from 1923 and television from 1954. Dow Jones and Reuters are among the quotation and news services available.
- Daily Newspapers (national): 4: El Nuevo Día (www.endi.com) (“The new day”), El Vocero de Puerto Rico (“The voice of Puerto Rico”), The San Juan Star (www.thesanjuanstar.com), and Primera Hora (“First hour”).
- Daily Newspaper Circulation: 650,000 (1998)
- Daily Circulation: 185 per 1000 persons
- Newspapers Advertising Revenues: $250 million
- Total Radios: 2.7 million (1997)
- Radios: 679 per 1000 persons
- Radio broadcast stations: AM 74, FM 53, shortwave 0 (2006)
- Television broadcast stations: 34 (2008)
- Total televisions: 900,000 or 99% of total households
- Televisions: 1.021 million (1997)
- Television broadcast stations: 18 (plus three stations of the US Armed Forces Radio and Television Service) (1997)
- TV Stations: Telemundo (WKAQ), Televicentro (WAPA), and TELE ONCE.
- Television Revenues: $1.5 million (1998)
- Cable TV subscribers: 280,000 (1998)
Puerto Rico has modern, reliable United States style telephone service (area calling codes are 787 and 939). All local calls costs 25 cents. Local information is 411, 1-787-555-1212. For directory assistance to others parts of Puerto Rico, dial 0. Person-to-person, collect and calling card calls are easy to place. At the center of the phone book are blue pages in English.
Total Telephones (main lines in use): 1.038 million (2008)
Total Telephones (mobile cellular): 3.354 million (2005)
Internet service companies provide access to the Net through local telephone calls around the island. National providers includes: AT&T, America On-Line, CompuServe, MSN and Sprynet. Local providers: Datacom Caribe, Inc., Caribbean Internet Services(now a PSINet Company), and PRTC.
Internet country code: .pr
Internet hosts: 700 (2009)
Internet users: 1 million (2008)
Companies providing mobile-phone, paging and celluar services include: Centennial de Puerto Rico (www.centennialpr.com ), Verizon Wireless (www.verizonwirelesspr.com), among others.
Companies providing Cable TV services include: Adelphia (www.adelphiapr.com), Centennial de Puerto Rico (www.centennialpr.com/cabletv), Liberty Cablevision (www.libertycablevision.com), among others.
Puerto Rico is part of the U.S. postal system (USPS) and has the same mail rates (28¢ for a postcard, 44¢ for a first-class letter) and service as provided on the U.S. mainland. Post offices are located in every city and offer Express Mail next-day service to the U.S. mainland and Puerto Rico.
In addition, express services are offered by FedEx, UPS, Emery, RPS, and DHL.
TAXES IN PUERTO RICO
Puerto Rico has a 5.5% sales tax. Municipalities have the option of imposing an additional sales tax of up to 1.5% (effective on November 15, 2006). In addition, in the event that the governor determines an insufficiency in collections for the general fund an additional 1% to the central government will be imposed.
All inbound shipments to Puerto Rico are subject to a local excise tax. Merchandise and/or articles arriving from the U.S. that will be sold, consumed, given away, and/or remain in Puerto Rico are subject to a 6.6% Puerto Rico excise tax that is calculated from the commercial invoice value. This is payable upon entry to Puerto Rico.
Puerto Rico has it own tax system. Although it is modeled after the U.S. system, there are differences in law and tax rates.
The Puerto Rico tax system is based on self-assessment. Taxes are paid to the state. In addition, a premium is paid to the Social Security. Individual taxpayers are required to file an annual income tax return when minimum-income thresholds are met. They report taxable income and deductions, compare their final tax liability to any income tax withheld or estimated tax paid, and determine any balance due or overpayment of tax due from the Treasury.
For information about the filing taxes in Puerto Rico contact the Bureau of Income Tax at the following address:
Negociado de Asistencia
Contributiva y Legislación
Departmento de Hacienda
P.O. Box 565
San Juan, Puerto Rico 00902-6265.
The telephone number is (787) 721-2020, extension 3611.
To obtain tax forms and instruction booklets contact the Forms and Publications Division Office at the above address, call (787) 721-2020, extensions 2643, 2645, or 2646, or visit their web site (www.hacienda.gobierno.pr).
HEALTH AND MEDICAL FACILITIES
Regulations and requirements may be subject to change at short notice, and you are advised to contact your doctor well in advance of your intended date of departure.
Good medical facilities exist in Puerto Rico. Every hotel has a doctor on call for guests.
Law requires immunizations for diphtheria, tetanus, whooping cough, and rubella. Immunizations are required for school registration.
DRIVER’S LICENSE AND DRIVER’S RECORDS
The process of obtaining a Puerto Rico driver license is easy to follow. When you apply for your license, take the following basic information: Social security card, ID with your full name, residential and postal address, date of birth and driver’s license number (if applicable).
Learners Permit Certificate
A learner’s license allows you to practice driving while accompanied by a licensed adult age 21 or older. You must be at least 16 to apply. You can study for the written permit test using the Driver’s Manual(PDF) provided by the DTOP available online.
To apply you must provide the following:
- Application for Driver License (form DTOP-775) (PDF)
If you are under 18 years of age, but older than 16 years of age, parent or legal guardian must present birth certificate (acceptable forms of identification) (PDF) and complete a notarized Parental affidavit Medical certificate (form DTOP-260)
- Social Security number (present Social Security card, W-2 form, SSA-1099, US Military card, or copy State or Federal Tax returns)
- Provide proof of residence and birth date (birth cerificate or passport – acceptable documents) (PDF)
- Three 2×2″ photographs
- Internal Revenue Seal of $10.00
- Pass the written exam
- Learners Permit Certificate with at least 30 days of expedition
- Pass the driving exam
- Three 2×2″ photographs
- Internal Revenue Seal of $10.00
If you wish to retake the exam you should present an Internal Revenue Seal of $5.00.
Renew of Driver’s License
- Complete the Application for Driver License (PDF), including medical certificate
- Two 2×2″ photographs
- Internal Revenue Seal of $10.00, if your license has expired you must present one for $20.00
If your license has been expired for more than 2 years and 30 days, you must take the written exam applicable for your license type.
Driver’s License for New Residents
New residents must obtain a valid Puerto Rico driver’s license within 30 days of establishing residency and may register to vote after 30 days. If you are a U.S. Citizen and you have a valid out-of-state license you must provide the following:
- Take an eye exam
- Pass the written exam, (if you are over 25 and your current license has no outstanding violations, the written exam could be waived)
- Internal Revenue Seal of $10.00
Duplicate of Driver’s License
- Affidavit on the loss of the license, indicating that has not been occupied by the Police or suspended by some court of Justice
- Two 2×2″ photographs
- Internal Revenue Seal of $5.00
- Identification with photo
How to obtain a driver’s record?
You may request a driver record by mail by providing the following information:
- Full name as it appears on your driver’s license
- Social Security number
- License number
- Reason for the request
- Address to which the record should be mailed
- Daytime telephone number
- Photocopy of a valid photo identification, preferably your Puerto Rico driver’s license
- Money order in the amount of $1.50 made out to: Secretario de Hacienda.
Secretario de Hacienda
San Juan, PR 00940-1240
Requests usually take 2 to 3 business days and mailed out via first class US Mail.
VEHICLE REGISTRATION AND INSURANCE INFORMATION
To register your car you must present vehicle’s current registration certificate, title (unless held by lien holder), and your out-of-state license plates. Puerto Rico law does not require drivers to carry vehicle insurance.
To register to vote applicants must be a U.S. citizen, 18-years-old by the election date and have lived in the state and county for at least 30 days and within their precinct 10 days prior to the election.
There is a good representation of all the major religious denominations in most towns: Roman Catholic, Christian Scientist, Presbyterian, Methodist, Evangelists, Islam, Scots Kirk, Seventh Day Adventists, Jehovah’s Witnesses, Salvation Army, Church of Christ, Mennonite, etc.
* * *
Act 20 – Individual Investors Act
Export Services (Act 20)
- 4% corporate tax rate, which may be reduced to 3%
- 100% tax exemption on dividends from export services businesses
- Decree of 20 years, renewable for an additional 10 years
This law seeks to attract new residents to the island by providing a total exemption from Puerto Rico’s income tax on all passive income realized or accrued after such individuals become bona fide residents of Puerto Rico. This hopes to accelerate the economy of Puerto Rico with new local investment in real estate, services and other consumption products and provide capital injections to the island’s banking sector though the relocation of this law.
The Individual Investors Act applies to any individual investor that becomes a Puerto Rico resident on or before the taxable year ending on December 31, 2035, provided that such individual was not a resident of Puerto Rico at any time during the 15-year period preceding the effective date of the Individual Investors Act.
“A Puerto Rico resident is an individual who is domiciled in Puerto Rico. Physical presence in Puerto Rico for a period of 183 days during the taxable year will create a presumption of residence in Puerto Rico for tax purposes.” Section 933 of the Internal Revenue Code of the United States of 1986 (the “US Code”) suggests, income derived from sources within Puerto Rico by individuals who are bona fide residents of Puerto Rico during the entire taxable year is not included in gross income and is exempt from taxation under the US Code. (the “Section 933 Exclusion”).
Some of the provisions include:
• 100% tax exemption from Puerto Rico income taxes on interest and dividend income derived during the Tax Exemption Period to Resident Individual Investors. “Section 933 Exclusion, interests and dividends received by Resident Individual Investors that qualify as Puerto Rico source income will not be subject to federal income taxation under the US Code.
• 100% exempted from Puerto Rico income taxes for Long-term capital gains (“LTCG) derived by Resident Investors for investment appreciation accruing after becoming a Puerto Rico resident, if such gain is recognized prior to January 1, 2036.
• On the other hand, LTCG derived by Resident Individual Investors will be subject to preferential income tax rates in certain circumstances.
The tax exemption granted under the Individuals Investors Act will expire on December 31, 2035 (the “Tax Exemption Period”).
* * *
Act 22 – The Act to Promote the Transfer of Investors to Puerto Rico
- 100% tax exemption from Puerto Rico income taxes on all dividends for new Puerto Rico residents
- 100% tax exemption from Puerto Rico income taxes on all interest for new Puerto Rico residents
- 100% tax exemption from Puerto Rico income taxes on all short-term and long-term capital gains accrued after the individual becomes a bona- fide resident of Puerto Rico.
- 0% federal taxes on Puerto Rico sourced income
- Decree benefits secured until December 31, 2035.
Once a U.S. citizen becomes a resident of Puerto Rico, any income derived by that person from sources within Puerto Rico is excluded from U.S. federal income tax. Thus, to the extent a U.S. citizen becomes a resident of Puerto Rico, the individual is subject to tax in Puerto Rico on Puerto Rico-source income only—any non-Puerto Rico source income, however, is still subject to U.S. federal tax.
Under the Internal Revenue Code, capital gains are generally sourced by reference to the taxpayer’s place of residence.
The tax benefits and incentives provided by Act No. 22 are generally available to individuals who have not been residents of Puerto Rico during the 15-year period prior to date of enactment (January 17, 2012) and who become residents of Puerto Rico on or before December 31, 2035.
Nonresidents seeking to claim the tax incentives under Act No. 22 must obtain a tax decree from Puerto Rico Industrial Development Company. This tax decree establishes the terms of the exemptions and benefits, and has the effect and force of a contract during the entire benefit period.
There is no minimum employee requirement for a nonresident, individual owner of an international banking entity.
The tax incentives available to individuals under Act No. 22 include:
- 100% tax exemption on interest and dividend income earned after the nonresident individual becomes a resident of Puerto Rico; also applies with respect to alternative minimum tax (AMT) up to tax year 2036
- 100% tax exemption on interest, financial charges, dividends or distributive share on partnership income from international banking entities in Puerto Rico including AMT
- 100% tax exemption on long-term capital gains realized and recognized after becoming a resident of Puerto Rico but before January 1, 2036
· If not realized and recognized within the incentive timeframe, regular individual long-term capital gain applies (currently at 10%)
· Applies to appreciation of property after becoming a resident of Puerto Rico
- 5% tax on long-term capital gains realized before becoming a resident of Puerto Rico, but recognized after 10 years of becoming a resident of Puerto Rico, as long as recognized before January 1, 2036
· This 5% long-term capital gain tax only applies to the portion of gain that relates to the appreciation of the property while the individual lived outside Puerto Rico
· If the long-term capital gain is not recognized within these time periods, applicable individual long-term capital gain rate would apply on any Puerto Rico-source long-term capital gain
* * *
Act 273 – Economic Incentives for the Development of Puerto Rico Act
- 4% income tax
- 0% on dividends or other distributions of profits to non-Puerto Rico residents
- 100% exemption on municipal taxes
- 100% exemption on property taxes
Business operations eligible under Act 273 divide by category. The first eligible business is industrial units dedicated to the manufacturing on a commercial scale. Second category of eligible business is services units for services markets outside of Puerto Rico, including the United States. These designated services include: trading companies, medical and hospital services; marketing centers; commercial art and graphic services; mercantile distributions; consulting (economic, human resources, etc); corporate headquarters; assembling, packaging and bottling services; electronic processing; among others.
Act 273 also includes businesses providing services in Puerto Rico to manufacturing units that belong to “Designated Clusters”. These are sectors or industries designated to the Executive Director as a high economic impact cluster. Among the key supplier services are: logistics, programming, validation, quality control, and inventory management, amongst others.
Act 273 provides for a 4% flat income tax rate imposed on net taxable income from eligible activities. Additionally, a 12% royalty tax rate is imposed on amounts paid by eligible businesses to other entities. However, the eligible business is allowed to make a non-revocable election that would subject the eligible business to an 8% flat income tax rate in exchange for a reduction of the royalty tax rate to 2%. This irrevocable election must be made before commencement of the exemption period and approval must be secured.
Economic Incentives Law. Some of the provisions include:
• 4% fixed income tax rate on net taxable income
• Pioneer industries’ tax rate of 0% or 1%
• Combined floor of 3% for local business
• Credit of up to $5,000 per job created during the first year of operation, if the operation is located in the municipalities of Vieques and Culebra
• Up to 50% credit of qualified R&D expenses• Credit for purchase of locally manufactured products
• Up to 10% credit of industrial energy consumption
• Special deductions for investment in structures, machinery and equipment
• Infrastructure incentives
• 90% exemption for personal and real property tax and 60% exemption for municipal taxes
• Training incentives