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If you're a bona fide resident of Puerto Rico during the entire tax year, you generally aren't required to file a U.S. federal income tax return if your only income is from sources within Puerto Rico.
A Puerto Rican corporation that's engaged in certain types of service businesses only pays Puerto Rican tax of 4%. you can pay 0% on certain dividends and capital gains you realize while you're a bona fide resident of Puerto Rico.
Self-employed taxpayers are subject to the total 15.3% tax rate comprised of 12.4% for OASDI and 2.9% for Medicare. The self-employment tax rate for self-employment income earned is 15.3% (12.4% for Social Security and 2.9% for Medicare).
To set yourself up as a self-employed taxpayer with the IRS, you simply start paying estimated taxes (on Form 1040-ES, Estimated Tax for Individuals) and file Schedule C, Profit or Loss From Business, and Schedule SE, Self-Employment Tax, with your Form 1040 tax return each April.
Excise tax: depends on the category of goods. Sales and use tax: 11.5 percent on most goods and services. 10.5 percent on goods and services not subject to municipal SUT.
Sales and use tax: 11.5 percent on most goods and services. 10.5 percent on goods and services not subject to municipal SUT. 4 percent on designated professional services and services rendered to other merchants (Special SUT).
The new tax contributes 1% to the municipality level and 10.5% to the "state" level. The IVU was scheduled to expire on 1 April 2016, to be replaced with a value-added tax (VAT) of 10.5% for the state level, with the 1% IVU continuing for the municipalities.
Puerto Rico will soon be replacing its existing state-level sales and use tax with a value added tax (VAT) system.
Designated professional services and business-to-business (B2B) services are taxed at a 4% SUT rate. Taxable services that are excluded from SUT include, among others, the following: Services rendered by merchants with annual volume of business of less than USD 50,000.
Professional services are not subject to sales tax in the state of California.