Opportunities for Software Developers under Act 60
May 2025 | TLVS LLC – Client Brief
Puerto Rico’s Act 60 of 2019 offers software developers one of the world’s most competitive tax regimes. If you’re building apps, platforms, tools, or software infrastructure in Puerto Rico, you may qualify for a fixed 4% income tax rate.
Act 60 presents multiple paths to significantly reducing your tax burden while building and scaling your business from Puerto Rico.
📈 Who Qualifies?
Act 60 includes four eligible activity types for software businesses:
- Custom Development for Export: Coding or building software for non-PR clients.
- Software Distribution (SaaS): Offering access to software for non-PR clients.
- Licensed Software Manufacturing: Developing software on a commercial scale that enables users to perform valuable tasks (PR clients allowed).
- IP Licensing (Royalties): Unrestricted licensing of proprietary software IP for royalties.
💸 What Are the Benefits?
Depending on your classification:
- 4% flat tax rate on eligible net income
- 100% exemption on dividends from qualifying income
- 75% to 100% exemption on property and municipal taxes
- 15-year tax decree, renewable for another 15 years
💡 Where Should You Start?
- Identify how your company earns money: Services? Subscriptions? Royalties?
- Determine your client base: are your clients outside of Puerto Rico? Are there PR clients?
- Choose the right activity: Match your business model to the right statutory category
🚀 Let’s Act. We Can Help.
We assist software developers, SaaS businesses, and tech founders in:
- Identifying the right Act 60 pathway
- Preparing detailed service descriptions
- Preparing and filing applications and amendments
- Ensuring full regulatory compliance
Let’s turn your software business into a 4%-tax success story. Contact us to explore how Act 60 can empower your software business.
Puerto Rico is not just a beautiful place to live — it may be the smartest place to build software.