Tax Incentives
Puerto Rico Tax Incentive Code Law 60 (Including former Act 20 and 22)
Act 60 Incentives Advisory Services
At Llano Morales CPAs PSC, we offer specialized support for individuals and entities seeking to benefit from the tax incentives provided under Puerto Rico’s Act 60 (Incentives Code). Our firm is actively engaged with clients across key incentive areas, including private equity funds, green energy, youth entrepreneurship, export services, manufacturing, creative industries, research and development, and financial services.
We understand that many applicants experience significant delays or denials due to an incomplete understanding of the law’s requirements and compliance expectations. At LLMCPAS, we go beyond traditional tax advisory. We partner closely with clients—particularly those relocating from English-speaking jurisdictions or struggling with language barriers—and provide guidance throughout the entire application and compliance process. Additionally, we help identify reliable and affordable local professionals (including legal, real estate, and operational consultants) to ensure every aspect of your Act 60 engagement is well-supported from the start.
Tax Incentives PR Act 60: Puerto Rico Incentives Code – Tax Decrees & Benefits
Act 60, enacted in 2019, consolidates and enhances previous tax incentive laws to attract investment, promote economic development, and create jobs in Puerto Rico. The Act offers a range of benefits across various sectors, including export services, tourism, manufacturing, agriculture, and more.
Export Services & Commerce
Eligibility: Businesses engaged in services primarily for markets outside Puerto Rico, such as consulting, shared services, telemedicine, software development, and research.
Manufacturing Incentives
Manufacturing businesses involved in the production, assembly, processing, or packaging of goods.
Tourism & Hospitality
Eligibility: Businesses in the tourism and hospitality sector, including hotel development and related services.
Agriculture Incentives
Eligibility: Businesses engaged in agricultural activities, including farming and related industries.
Financial & Insurance Services
Eligibility: Financial institutions and insurance companies providing eligible services.
Renewable Energy Projects
Eligibility: Companies engaged in renewable energy projects, including solar, wind, and other sustainable energy initiatives.
Film & Creative Industries
Eligibility: Businesses involved in film production, digital media, and other creative industries.
Tax Exemption Period & Renewal
Act 60: Incentives for Young Entrepreneurs
Under Chapter 10 of Act 60, Puerto Rico offers targeted benefits to young individuals who establish new businesses on the island. These incentives are designed to encourage entrepreneurship and economic development among residents aged 16 to 35.
Eligibility Criteria
To qualify for these incentives, applicants must:
-
Age:
Be between 16 and 35 years old.
-
Residency:
Be a bona fide resident of Puerto Rico.
-
Education:
Possess a high school diploma or equivalent.
-
Business Type:
Establish a new business that has not been previously operated through affiliates or reorganizations.
-
Business Operation:
Operate the business exclusively by the young entrepreneur.
-
Agreement:
Enter into a Special Agreement with the Secretary of the Department of Economic Development and Commerce (DEDC) before commencing operations.
Available Tax Incentives
Qualified young entrepreneurs can benefit from the following tax exemptions:
-
Income Tax:
100% exemption on the first $500,000 of net income generated by the new business during the first three years of operations.
-
Property Taxes:
100% exemption on personal property taxes during the first three years of operations.
-
Municipal Taxes:
100% exemption on municipal license taxes during the first three years of operations.
Any income exceeding $500,000 and dividends distributed from the business will be subject to standard tax rates under Puerto Rico's Internal Revenue Code.
