Puerto Rico or Delaware: where should your business be based?
Delaware ranks higher in the index, 21 against 22. Which suits you depends on where the owners live, what the company is for and how it will be run.
Pillar by pillar
Doing business, side by side
Tax
The normal tax is 18.5% plus a surtax of up to 19%, giving a top rate of 37.5%. An Act 60 export services decree fixes the rate at 4%, with dividends from that income exempt. There is no VAT; the sales and use tax is 11.5%.
No Delaware income tax is due where no business is done in the state, but annual franchise tax applies. There is no state sales tax.
Set-up
A stock corporation is formed online with the Department of State for $150, or an LLC for $250, with no set waiting period. A corporation files a $150 annual report by 15 April; an LLC pays a $150 annual fee.
A corporation's filing fee starts at US$109. No standard processing time is published, but paid services offer 24-hour, same-day and faster filing.
On the ground
The certificate must name a designated office and a resident agent in Puerto Rico. Directors need not live there, and audited accounts are needed once the volume of business passes $10 million.
Every company must keep a registered agent with a Delaware address, and no director needs to live in the state. There is no minimum capital.
Ownership
There is no beneficial ownership register. FinCEN's March 2025 interim rule removed federal beneficial ownership reporting for companies formed in the US, including Puerto Rico.
Under FinCEN's final rule, effective 14 August 2026, companies formed in the United States are exempt. Only foreign companies registered there still report.
Residence
US citizens can move to Puerto Rico freely. Foreign nationals need US immigration status, such as an EB-5 green card from $800,000 in a targeted employment area or $1,050,000 elsewhere.
Owning a company confers no residence. The E-2 visa is limited to treaty nationals, and the EB-5 requires an investment from US$800,000.
Living and working
Currency
US dollar.
US dollar.
Time zone
UTC-4 all year, with no daylight saving.
UTC-5, and UTC-4 in summer.
Personal tax
Puerto Rico income tax rises to 33% above $61,500 of net taxable income. Long-term capital gains and dividends are taxed at 15%.
Federal top rate 37% above $640,600 for a single filer in 2026; Delaware charges 6.60% from $60,000 and repealed estate tax in 2018.
Flights
San Juan's Luis Munoz Marin airport has nonstop flights to about 60 destinations, mostly on the US mainland, plus Madrid, Bogota and Panama City.
Wilmington (ILG) has Avelo flights to Florida and San Juan, and an American Airlines coach to Philadelphia, which serves Heathrow.
Language
English is the official language of the United States under an Executive Order of 1 March 2025.
Puerto Rico vs Delaware: common questions
Puerto Rico: The normal tax is 18.5% plus a surtax of up to 19%, giving a top rate of 37.5%. An Act 60 export services decree fixes the rate at 4%, with dividends from that income exempt. There is no VAT; the sales and use tax is 11.5%. Delaware: No Delaware income tax is due where no business is done in the state, but annual franchise tax applies. There is no state sales tax.
Puerto Rico: A stock corporation is formed online with the Department of State for $150, or an LLC for $250, with no set waiting period. A corporation files a $150 annual report by 15 April; an LLC pays a $150 annual fee. Delaware: A corporation's filing fee starts at US$109. No standard processing time is published, but paid services offer 24-hour, same-day and faster filing.
Puerto Rico: The certificate must name a designated office and a resident agent in Puerto Rico. Directors need not live there, and audited accounts are needed once the volume of business passes $10 million. Delaware: Every company must keep a registered agent with a Delaware address, and no director needs to live in the state. There is no minimum capital.
Puerto Rico: There is no beneficial ownership register. FinCEN's March 2025 interim rule removed federal beneficial ownership reporting for companies formed in the US, including Puerto Rico. Delaware: Under FinCEN's final rule, effective 14 August 2026, companies formed in the United States are exempt. Only foreign companies registered there still report.
Puerto Rico: US citizens can move to Puerto Rico freely. Foreign nationals need US immigration status, such as an EB-5 green card from $800,000 in a targeted employment area or $1,050,000 elsewhere. Delaware: Owning a company confers no residence. The E-2 visa is limited to treaty nationals, and the EB-5 requires an investment from US$800,000.
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