Open a Sole Trader in Costa Rica

Our specialists in setting up a company in Costa Rica explain below the requirements to set up a sole trader in Costa Rica. We can assist with the registration procedures.

Steps to create a sole trader in Costa Rica

Any person who is at least 18 years of age can open a sole trader in Costa Rica. The requirements depend on whether the businessperson is a Costa Rican citizen or a foreign resident. Also, non-residents and companies can also operate such enterprises in this country.

The procedure of launching a sole proprietorship is similar to opening a company in Costa Rica, meaning:

• business name reservation;
• documents preparation;
• registration with the Public Registry;
• opening a local bank account;
• enrolment with the Tax Administration;
• licensing.

Sole traders must also obtain digital signatures at the end of the incorporation procedure.

In the case of foreigners who come here, there are two scenarios that apply:

• They open companies in Costa Rica and, through them, they set up sole proprietorships;
• They apply for residence permits for Costa Rica and create a business in their own names.

 Feel free to rely on our local consultants for assistance with the registration of this business form. If you are interested in starting a business in another country, such as the Netherlands, we can put you in touch with our local partners.

Documents required to operate as a sole trader in Costa Rica

Here are the papers required to establish a Costa Rican sole proprietorship:

• business name registration certificate issued by the Companies Registrar;
• proof of paying social security contributions;
• fiscal certificate issued by the local tax authorities;
• valid ID/residence permit in the case of natural persons and registration certificate in the case of companies.

Our company formation consultants can assist with the preparation of the necessary documents to set up a sole trader. If you are a foreign national, you can grant our lawyers in Costa Rica a power of attorney, and they can handle the registration on your behalf.

Business name requirements for a sole trader in Costa Rica

An important verification before proceeding to the creation of the sole trader is verifying the chosen business name. It must be unique and not offensive. However, there is another simplified procedure you can use, and that is to obtain a business registration number. In this case, your sole proprietorship will no longer go through the trading name checks performed by the Trade Registrar.

You can enquire with our local specialists about both options and choose the one that fits you best.

Business permits for sole proprietors in Costa Rica

Just like any other type of business, a sole trader may need to apply for specific business permits. One of the most important is the sanitary license. This type of authorization is related to the environmental risk posed by the activity to be undertaken, and which can be:

• low;
• moderate;
• high.

The main difference between them is the licensing fee, which is proportional to the damage of the operations to the environment. This permit is issued by the Costa Rican Health Ministry.

Tax registration and imposition for sole traders in Costa Rica

There are two aspects to consider when it comes to registering for taxation as a sole proprietor in Costa Rica:

• the mandatory requirement to obtain a tax identification code;
• registration for VAT, which becomes mandatory from the start of the taxable activity (there is no turnover threshold).

With respect to taxation of sole traders, the personal income levy ranges from 0% to 25% (2026 annual brackets) as follows:

• 0% up to CRC 6,244,000 and 10% up to CRC 8,329,000;
• 15% up to CRC 10,414,000 and 20% up to CRC 20,872,000;
• 25% on income above CRC 20,872,000 per year.

If you want to open a sole trader in Costa Rica, feel free to contact us for assistance.