Nonresident Withholding
We organize the transaction information, prepare the applicable tax documents, and coordinate the corresponding filing before the Treasury.
When a person who does not reside in Puerto Rico sells certain assets located in Puerto Rico or receives certain payments from Puerto Rico sources, there may be an obligation to withhold, deposit, and report tax to the Department of the Treasury.
In sales of real property, the buyer may become a withholding agent and assume specific responsibilities. The applicable amount should not be determined solely by where the seller lives: citizenship, type of entity, tax residency, price, cost or available basis, and other elements of the transaction may also influence it.
RTM Accounting helps organize the file, perform the administrative calculations based on the information provided, and prepare the applicable tax forms and filings.
When might you need this service?
- Sale of real property located in Puerto Rico by a nonresident person.
- Transaction in which one or more sellers reside outside Puerto Rico.
- Sale made by a nonresident estate, corporation, partnership, or entity.
- Closing that requires determining and documenting a tax withholding.
- Preparation of the corresponding deposit or receipt.
- Preparation of informative returns related to payments to nonresidents.
- Administrative evaluation of a refund or release request.
- Correction of a previously filed withholding or informative return.
- Coordination with the notary, broker, buyer, seller, or tax representative.
Scope of RTM's service
- Initial interview and administrative classification of the seller.
- Gathering of residency, citizenship, or entity documents.
- Organization of the acquisition deed, price, and documented expenses.
- Administrative preparation of the withholding computation.
- Coordination of applicable forms, deposits, and informative returns.
- Preparation of the file for requests related to release or refund, when engaged.
- Administrative communication with the parties and closing professionals.
- Follow-up on Treasury notices or requirements.
- Preparation of corrections, when applicable and engaged.
Information or documents that may be requested
The applicable rate, form, and procedure depend on the seller's classification and the facts of the transaction. The percentage should not be assumed without reviewing the file. The documentation needed depends on the seller's classification, the nature of the transaction, and the corresponding tax procedure.
- 01Seller's identification.
- 02Social Security number or employer identification.
- 03Evidence of tax residency.
- 04Evidence of citizenship or entity classification, when applicable.
- 05Option contract or purchase and sale agreement.
- 06Draft or copy of the purchase and sale deed.
- 07Deed through which the seller acquired the property.
- 08Evidence of the acquisition price or cost.
- 09Invoices for available capitalizable improvements.
- 10Notarial fees, stamps, duties, and commission related to the transaction.
- 11Title study or registry information.
- 12Cadastre number and CRIM documents.
- 13Preliminary or final closing breakdown.
- 14Evidence of the withholding and deposit, if already made.
- 15Forms or communications previously filed.
- 16Withholding agent's SURI information.
- 17Power of attorney or authorization, when applicable.
General process
- 01
Transaction identification
We confirm the parties, the property, the price, and the projected closing date.
- 02
Seller classification
We organize available information on residency, citizenship, and entity type.
- 03
Acquisition and expense review
We gather the acquisition price and documented expenses that may be relevant.
- 04
Administrative preparation
We prepare the computation and applicable documents based on the information provided.
- 05
Closing review
We coordinate with the corresponding parties and professionals to review the breakdown related to the withholding.
- 06
Deposit, informative return, or request
We handle the engaged procedure through the applicable forms and processes.
- 07
Follow-up
We provide administrative follow-up on communications or requirements related to the service.
Frequently asked questions
Related official resources
Evaluate the withholding before closing
Share the seller, property, and transaction information so we can identify the documents and procedures that may apply.