Act 60 Export Services – Full Detailed Guide

If you’ve been exploring tax incentives that can transform your business, you’ve probably heard of Act 60—the modern framework that replaced the well-known Acts 20 and 22. One of its most powerful incentives is the Export Services Incentive, designed to boost the service-based economy in Puerto Rico.

What Is Act 60?

Act 60 is Puerto Rico’s comprehensive tax incentive code that attracts businesses and individuals to relocate and operate on the island. It creates a unique pathway for service providers to dramatically reduce tax burdens while expanding globally.

Why Export Services Matter

The incentive exists to turn Puerto Rico into a global hub for service exports. Instead of producing physical goods, the focus is on professional and digital services delivered to clients outside Puerto Rico.

Understanding the Export Services Incentive
Purpose of the Incentive

The Export Services program drives economic growth by:

Encouraging entrepreneurship

Attracting international clients

Supporting digital and knowledge-based industries

Industries That Qualify

Many service industries qualify, including:

Digital marketing agencies

E-commerce consultants

Software developers

Financial consultants

Creative service providers

Key Requirements for Eligibility

To qualify, your business must:

Provide services to clients outside Puerto Rico

Be registered and operating from Puerto Rico

Maintain proper accounting and compliance

Benefits of Act 60 Export Services
4% Corporate Tax Rate

Yes, you read that right—only 4% corporate tax on eligible income. This is one of the lowest tax rates in the world and a major reason Act 60 attracts global entrepreneurs.

100% Tax Exemption on Dividends

Dividends distributed from your Act 60 business to its owners are fully exempt. This means more money stays in your pocket.

Additional Financial Advantages

Reduced operational costs

Access to a growing business community

Potential personal tax benefits if you become a resident under other Act 60 chapters

Who Can Apply for Act 60 Export Services?
Individual vs. Corporate Applicants

Both individuals and corporations can apply. However, most people form:

LLCs

Corporations

Partnerships

Common Professions That Qualify

Online coaches

Programmers

Designers

Accountants

Business consultants

Content creators

If your business sells services, chances are you qualify.

How to Qualify for the Incentive
Residency Requirements

You don’t need to be a resident if you’re only applying for the Export Services incentive. Residency matters for the individual investor incentives (formerly Act 22), not Act 60 Export Services.

Business Presence in Puerto Rico

You must:

Register your entity

Have real economic activity on the island

Keep up with annual reporting

Compliance Obligations

Staying compliant includes:

Annual filings

Compliance fees

Proper bookkeeping

Step-by-Step Application Process
1. Creating Your Business Entity

You’ll start by forming an LLC or corporation in Puerto Rico.

2. Filing the Act 60 Application

Submit your application to the Office of Incentives for a tax decree that locks in your benefits for 15 years.

3. Maintaining Annual Compliance

This includes:

Filing tax returns

Paying annual fees

Documenting all exporting activity

Types of Eligible Services
Professional Services

Lawyers, accountants, consultants—any service provided to clients outside Puerto Rico.

Digital and Technology Services

Software as a Service (SaaS)

App development

SEO services

Web design

Creative and Marketing Services

Branding

Social media management

Graphic design

Video production

Common Mistakes to Avoid
Incorrect Business Structure

Choosing the wrong entity could disqualify you or increase your tax burden.

Failing to Meet Compliance Standards

Don’t risk losing your tax decree—compliance is non-negotiable.

Act 60 vs. Previous Acts 20 and 22
Key Differences

Act 60 consolidated previous incentive laws and increased oversight to reduce abuse.

Why the Change Was Made

The goal was to simplify the laws, increase transparency, and strengthen Puerto Rico’s economic development strategy.

Real-World Examples
Export Service Providers

Many agencies have relocated operations to Puerto Rico to expand globally at a significantly lower tax rate.

Digital Entrepreneurs

Freelancers and online service providers thrive under Act 60 due to minimal overhead and massive tax savings.

Is Act 60 Right for You?
Key Considerations

Do you sell services outside Puerto Rico?

Are you looking for legal tax reduction?

Are you willing to follow compliance rules?

Long-Term Benefits

With a 15-year tax decree, stability and predictability are central advantages.

Conclusion

The Act 60 Export Services program is one of the most powerful tax incentives available today. Whether you’re a digital entrepreneur, a consultant, or a business owner looking to expand globally, Act 60 offers unprecedented tax benefits that can transform your financial future. With proper compliance and strategic planning, you can enjoy a low tax environment while building a thriving international service business from Puerto Rico.

FAQs
1. Do I need to live in Puerto Rico to qualify for Export Services?

No, residency is not required for the Export Services incentive.

2. How long does the Act 60 decree last?

The decree typically lasts 15 years, offering long-term tax stability.

3. Are dividends really 100% exempt?

Yes, dividends from Act 60 export service income are fully exempt.

4. What is the biggest benefit of Act 60 Export Services?

The 4% corporate tax rate, which is one of the lowest in the world.

5. Can freelancers apply for Act 60?

Absolutely. Freelancers, consultants, and digital service providers commonly use this incentive.