Act 60 Individual Investors

The purpose of Act 60 Resident Individual Investors is to attract new residents to Puerto Rico

Act 60 is a consolidation and harmonization of many previous Puerto Rico economic development programs. While almost all other economic development programs focus on incentives for businesses, this program is designed for individuals that relocate to the Commonwealth of Puerto Rico, a U.S. Territory. Formerly known as Act 22 of 2012 ("Act to Promote the Relocation of Individual Investors to Puerto Rico"), the Act 60 Resident Individual Investor program provides a total exemption from Puerto Rico income taxes on Puerto Rico sourced passive income realized or accrued after such individuals become bona fide residents of Puerto Rico. The large number of incoming Act 60 Resident Individual Investor participants has resulted in new local investments in real estate, services and other consumption products, and in capital injections to the Puerto Rico banking sector, all of which accelerate the economy of Puerto Rico. The Act 60 Resident Individual Investor program complements other Act 60 incentives, which are for active income from eligible services or trade activities, and can be used in tandem by Act 60 program participants. Very often, however, the Act 60 Resident Individual Investor program is used stand-alone by individual investors that do not participate in Act 60 Export Services or Act 60 Export Trade activities, or various other economic development programs.

Below is the description of the Act 60 Resident Individual Investor  program as provided by the Puerto Rico Department of Economic Development and Commerce (DDEC).

Act 60 Resident Individual Investor Overview - Section 2021.01

  • ELIGIBILITY

  • RESIDENCY

  • PASSIVE INCOME

  • EXEMPTION PERIOD

  • INVESTMENT

ELIGIBLE INDIVIDUALS

Resident Individual Investor.- Section 1020.02 defines Resident Individual Investor as an individual eligible to receive the benefits provided in Sections 2022.01 and 2022.02 of this Code and who is a Resident Individual of Puerto Rico, but has not been a Resident Individual of Puerto Rico for the last ten (10) taxable years prior to the effective date of this Code (2008 to 2018), and becomes a Resident Individual of Puerto Rico not later than the Taxable Year ending December 31, 2035. 

Students studying abroad who resided in Puerto Rico prior to leaving to pursue an education, the personnel working outside of Puerto Rico temporarily for the Government of Puerto Rico, its agencies and instrumentalities, and individuals similarly situated, shall not be considered Resident Individual Investors, given that, in such cases, their domicile continues to be Puerto Rico for the period during which they reside outside of our jurisdiction.

EXEMPT BUSINESS INCLUDES RESIDENT INDIVIDUAL INVESTOR

The term Exempt Business or Eligible Business when used in the language of Act 60, not only includes those individuals (shareholders) or business activities that qualify for the incentives under a Decree, but also includes Resident Individual Investors who relocate to Puerto Rico and qualify for the benefits as provided for under the Puerto Rico Incentives Code.

Act 60 Resident Individual Investor Overview - Section 2021.01

  • ELIGIBILITY

  • RESIDENCY

  • PASSIVE INCOME

  • EXEMPTION PERIOD

  • INVESTMENT

ELIGIBLE INDIVIDUALS

Resident Individual Investor.- Section 1020.02 defines Resident Individual Investor as an individual eligible to receive the benefits provided in Sections 2022.01 and 2022.02 of this Code and who is a Resident Individual of Puerto Rico, but has not been a Resident Individual of Puerto Rico for the last ten (10) taxable years prior to the effective date of this Code (2008 to 2018), and becomes a Resident Individual of Puerto Rico not later than the Taxable Year ending December 31, 2035. 

Students studying abroad who resided in Puerto Rico prior to leaving to pursue an education, the personnel working outside of Puerto Rico temporarily for the Government of Puerto Rico, its agencies and instrumentalities, and individuals similarly situated, shall not be considered Resident Individual Investors, given that, in such cases, their domicile continues to be Puerto Rico for the period during which they reside outside of our jurisdiction.

EXEMPT BUSINESS INCLUDES RESIDENT INDIVIDUAL INVESTOR

The term Exempt Business or Eligible Business when used in the language of Act 60, not only includes those individuals (shareholders) or business activities that qualify for the incentives under a Decree, but also includes Resident Individual Investors who relocate to Puerto Rico and qualify for the benefits as provided for under the Puerto Rico Incentives Code.

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