Corporations doing business in Puerto Rico pay income tax to the Departamento de Hacienda (Puerto Rico's Treasury Department, "Hacienda") under the 2011 Código de Rentas Internas (Internal Revenue Code of Puerto Rico). The system has several layers: a normal tax, a surtax, an alternative minimum tax and, for some service corporations, an optional tax on gross income.
This guide summarizes the rules in effect for tax year 2026. If your business is a partnership or an LLC, first check how it's taxed in partnerships and LLCs, because an LLC can be taxed as a corporation or as a pass-through entity.
Did the rates change in 2025 or 2026?
No, as far as official sources show. The Code text published by Hacienda, revised as of May 28, 2026, keeps the corporate rates in effect since 2019. The tax reform introduced in January 2026 (Senate Bill 912 and House Bill 1014) focused on lowering rates for individuals, according to the Financial Oversight and Management Board's statement of January 30, 2026. If a law changing corporate rates is passed later, we'll update this guide.
Who must file
According to Internal Revenue Carta Circular (Circular Letter) No. 26-06, every domestic or foreign corporation engaged in a trade or business in Puerto Rico must file the Corporation Income Tax Return (Form 480.2). This includes LLCs taxed as corporations, which is how the Code treats an LLC by default if it makes no other election.
Corporations with a tax exemption decree under the Incentives Code (Act 60-2019) use a different form and have a different due date. See Act 60 guide.
The rates
Normal tax
Section 1022.01 imposes on every regular corporation a tax of 18.5% on its net income subject to normal tax, for tax years beginning after December 31, 2018.
Surtax
Section 1022.02 adds a surtax on net income subject to normal tax minus a $25,000 deduction. In a controlled group of corporations, that $25,000 deduction is shared among all members.
| Net income subject to surtax | Surtax |
|---|---|
| Up to $75,000 | 5% |
| $75,001 to $125,000 | $3,750 plus 15% of the excess over $75,000 |
| $125,001 to $175,000 | $11,250 plus 16% of the excess over $125,000 |
| $175,001 to $225,000 | $19,250 plus 17% of the excess over $175,000 |
| $225,001 to $275,000 | $27,750 plus 18% of the excess over $225,000 |
| Over $275,000 | $36,750 plus 19% of the excess over $275,000 |
The combined top marginal rate is 37.5% (18.5% plus 19%).
These are hypothetical calculations, without credits or other taxes:
| Net income | Normal (18.5%) | Surtax | Total | Effective rate |
|---|---|---|---|---|
| $80,000 | $14,800 | $2,750 (5% of $55,000) | $17,550 | 21.9% |
| $300,000 | $55,500 | $36,750 (on $275,000) | $92,250 | 30.8% |
| $1,000,000 | $185,000 | $169,750 | $354,750 | 35.5% |
Alternative minimum tax
Section 1022.03 imposes an alternative minimum tax (contribución alternativa mínima, CAM) when the "tentative minimum tax" is greater than the regular tax. For tax years beginning after December 31, 2018, the tentative minimum tax is the greater of $500 or 18.5% of alternative minimum net income above the exempt amount. The exempt amount is $50,000, reduced by 25% of alternative minimum net income over $500,000. Corporations subject to the audited statements requirement because their volume of business is $10 million or more have a 23% rate instead of 18.5%.
In practice, this means a corporation with losses can owe at least $500. Also, certain deductions aren't allowed when figuring the CAM if they weren't reported on informative returns. See informative returns 480.
Optional tax for service corporations
Section 1022.07 lets a corporation whose income comes substantially from services elect to pay a rate on its gross income, with no deductions, instead of the normal tax, surtax and alternative minimum tax:
| Gross income | Rate on gross income |
|---|---|
| Up to $100,000 | 6% |
| $100,001 to $200,000 | 10% |
| $200,001 to $300,000 | 13% |
| $300,001 to $400,000 | 15% |
| $400,001 to $500,000 | 17% |
| Over $500,000 | 20% |
To elect it, at least 80% of gross income must come from services subject to the 10% withholding under Section 1062.03, and the income must have been subject to withholding or the corporation must have complied with estimated tax. For example, a corporation with $150,000 of gross income would pay $15,000 (10%). It's worth comparing with an accountant, because with no deductions it can end up costing more.
Due dates and extension
Section 1061.16 and Circular Letter 26-06 provide:
- General due date: the 15th day of the fourth month after the end of the tax year. For calendar year 2025, the return was due Wednesday, April 15, 2026. A corporation with a May 31, 2026, year-end has until September 15, 2026.
- Automatic six-month extension, requested with Form SC 2644, only through SURI (Hacienda's online system), no later than the due date.
- Corporations with a decree under Act 60-2019: June 15 for a calendar year, or the 15th day of the sixth month after year-end.
If the date falls on a weekend or holiday, it moves to the next business day.
The extension is not an extension to pay. Any balance must be paid by the original due date. Anything you don't pay on time accrues 10% annual interest and surcharges, under Section 6030.02. We explain this in interest, surcharges and penalties.
How to file
Since Internal Revenue Circular Letter No. 19-08, the corporate return is filed electronically only. According to Circular Letter 26-06:
- Prepare and file the return using one of the certified software programs approved by Hacienda, available through hacienda.pr.gov (for 2025, starting March 16, 2026). Each provider sets its own price. Tax return preparers use their own software with their preparer number and PIN.
- Upload the required supporting documents through SURI no later than the fourth business day after the due date, including the extension. Once you submit them, you can't add or remove documents.
- Pay the balance when you file, from your SURI account or from the SURI home page without logging in, by selecting "Pago de planilla" (return payment) and the correct period.
If a preparer signs for you, they must have your authorization on Form SC 2909 A and keep it for ten years.
Estimated tax
Section 1061.23 requires estimated tax payments from every corporation whose estimated tax for the year, including the alternative minimum tax, is more than $1,000. For a calendar year, if the requirement exists from the start of the year, you pay in four 25% installments on the 15th day of the fourth, sixth, ninth and twelfth months: April 15, June 15, September 15 and December 15.
For example, if you estimate $40,000 of tax, each installment would be $10,000.
Financial statements
Section 1061.15 sets what must accompany the return based on the year's volume of business:
| Volume of business | Requirement |
|---|---|
| Less than $1 million | No financial statements required |
| $1 million to less than $3 million | Audited statements optional (or an agreed-upon procedures or compliance report) |
| $3 million to less than $10 million | Audited statements, or instead an agreed-upon procedures or compliance report prepared by a CPA |
| $10 million or more | Financial statements audited by a CPA licensed in Puerto Rico |
For groups of related entities, the group's volumes are added together, under special rules. "Large taxpayers" must also file the return certified as prepared or reviewed by a CPA (Section 1061.02).
A corporation's other obligations
The income tax return is only one part. A corporation also usually has to comply with IVU (sales and use tax), the patente municipal (municipal license tax), personal property tax with the CRIM (Municipal Revenue Collection Center), employer withholding and informative returns. For dates, see the tax calendar.
Frequently asked questions
What is the corporate income tax rate in Puerto Rico?
A regular corporation pays an 18.5% normal tax plus a 5% to 19% surtax on income above $25,000. The top marginal rate is 37.5%. A qualifying service corporation can elect a rate of 6% to 20% on its gross income.
Does my corporation have to pay anything if it had losses?
Usually it must pay at least the $500 alternative minimum tax, because the tentative minimum tax is the greater of $500 or the percentage calculation.
Can I file the corporate return on paper?
No. Hacienda accepts the corporate return only electronically, through certified software, according to Circular Letter 26-06.
What happens if I don't pay estimated tax?
Tax not paid on time accrues interest and can lead to additions for failure to pay. It's a good idea to review the installments with your accountant, especially if the corporation's income changes a lot during the year.
Is a corporation or an LLC better for me?
It depends on your situation: how many owners there are, whether they're residents, how much the business will earn and whether you plan to distribute the profits. Read partnerships and LLCs and talk to a CPA or attorney before deciding.
Sources
- Código de Rentas Internas de Puerto Rico de 2011, según enmendado (Secciones 1022.01, 1022.02, 1022.03, 1022.07, 1061.02, 1061.15, 1061.16 y 1061.23), Departamento de Hacienda. hacienda.pr.gov
- Departamento de Hacienda, "Carta Circular de Rentas Internas Núm. 26-06 (radicación de la planilla de corporaciones del año contributivo 2025)", 13 de marzo de 2026. hacienda.pr.gov
- Departamento de Hacienda, "Código de Rentas Internas de Puerto Rico de 2011". hacienda.pr.gov
- Junta de Supervisión Fiscal, "FOMB Statement – Tax Reform", 30 de enero de 2026. oversightboard.pr.gov
787TAX is an independent guide. It is not Puerto Rico's Departamento de Hacienda, the CRIM or the IRS. This page is general information, not tax or legal advice. Example figures are hypothetical. Found an error? Tell us.
