The tax year in Costa Rica begins on the 1st of October and ends on the 30th of September. If the corporate body is filling late the tax return, a penalty of 1% from the total tax debt must be paid every month. The penalty can reach in some cases to 20%.
Only the incomes earned in Costa Rica are subject to income taxes. We are at your disposal with guidance on taxes and company formation in Costa Rica. We also offer assistance to investors interested in residency in Costa Rica.
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Various taxes in Costa Rica
The dividends are taxed depending on the way of payment: 15% for the dividends paid to individual shareholders and only 5% paid for the companies registered at the stock market. People interested in immigration to Costa Rica can benefit from the advantageous taxes applied here.
Capital gains are taxed with a rate of 30% but only if the gains are derived from the usual activities of the seller or if the sold goods can be amortized. We can offer support in company formation in Costa Rica.
The corporate taxation depends on the earnings of the company. The rates for the companies earning less than 91000 USD per year are 10%, for companies earning between 91000 USD-183000 USD is 20 % and the rate for the companies earning more than 183000 is 30%.
The withholding tax on interest is 15%, but if the interest is paid to approved banks or financial institutions is 0%.
The withholding tax on royalties is 25%, with an exemption for the ones not credited by the payer’s parent company.
The withholding tax for technical services is 25%.
If you want to open a company in Costa Rica, contact us. We can also advise you if you plan on applying for citizenship by investment in Costa Rica.
Even if they do not meet the residency criteria, foreigners who are first-degree relatives—spouses or children—of a Costa Rican citizen can apply for the permanent residence visa. If they live here for a sufficient period of time, they can also become eligible for Costa Rican citizenship.
Foreigners are allowed to file for permanent residence permits if they have maintained the temporary residence status for at least 3 years after moving to Costa Rica. If you need support in drafting and filing your paperwork, you can rely on our immigration specialists who can provide tailored support for relocation purposes.
VAT in Costa Rica
Every company must register and pay the VAT, at a rate of 13%.
The social security must be paid by the employer at a rate of 26.17 % from the gross salary paid to an employee, while the employee must pay 9.17% if hired by another or 9.5% if self-hired.
Among the major incentives offered to the companies in Costa Rica, there are also the exemptions offered for the business opened in the free zones. The income, the VAT, the Consumption Tax and the custom duties for machinery, equipment and materials are fully excluded from taxation for a period of 12 years, followed by a period when only a half of the taxes are paid for a period of 6 years. We can also guide those who want to apply for citizenship by investment in Costa Rica.
If you decide to start a business in Costa Rica, you can choose between various industries.
The companies involved in tourism development have also received many incentives. For example, the companies involved in car renting receive a 50 % discount at the taxes related to the vehicle import. The companies involved in construction or managing of hotels receive relief from import taxes on goods imported for the purposes of their business, sales taxes on supplies and the 0.25% annual rates tax. The companies involved in air transportation receive relief from import fees on assets imported for the purposes of their business and sales taxes on consumables necessary for the operation of airplanes. If you are interested in immigration to Costa Rica, we can advise on the main types of visas.
A special residence permit for Costa Rica is the student pass. It is given to children enrolled in local schools, researchers, volunteers, and students. The requirements to obtain are not stringent, and imply filing evidence of being linked to a Costa Rican form of education. You can obtain more information about it from our agents.