While the tax structure of Costa Rica is considered much simpler than many countries, we help you make it still simpler with help on all taxation subjects applicable to you. The tax laws in Costa Rica are simple, you earn more, you pay more taxes and if you earn less than what is a minimum, you pay no taxes.
A bird’s eye view of tax structure in Costa Rica:
Irrespective of what you call home or office in Costa Rica, the local community government charges you a municipal tax. The tax thus collected goes towards financing the local bureaucracy, street cleaning and lighting. The basis of the amount of levy depends upon the local government and the frontage that your property occupies. The municipal taxes are quite low and vary from location to location and are in the range of 10 USD a month per property. The control of municipality taxes was with the government which has been transferred to local community recently. The structure has changed to and you will have to pay 0.25% of the property value annually as tax. If your property is valued at less than ¢6,000,000.00 (six million colones), you will not need to pay these taxes, although you will need to apply for this exemption.
In case you are buying a house or a car, you would not need to pay sales tax. However, since they are registered in the National Registry, you will need to pay a transfer tax. While cars are taxed at the rate of 2.5% of the retail price (as decided by the Ministry of Treasury which are announced in an annual publication), the property you buy is taxed at 1.5% over the price (registered in the Hacienda or the Treasury Department).
Currently a flat rate of 13% is levied as sales tax on all goods sold and some services. However, intellectual services like the services of Doctors, Lawyers, Independent professionals and Dentists are exempt from sales tax. All other goods you buy, right from a newspaper to a white good is taxed. Some very small businesses like a soda store or a round-the-corner vendors fall under the simplified sales tax regime.
Last but not the least, the most important tax is the Income tax which is levied on all individuals and corporations incorporated in Costa Rica. The tax scale needs to be calculated base don your earnings form a profession, any employment or any other services you render for individuals. The corporations need to pay taxes on total income earned. Income tax scales also have exceptions depending on circumstances and business.
Costa Rica follows a business or fiscal year from 1st of October to the 30th of September after which everyone needs to file the tax declaration irrespective of being taxable or not. The scales for income tax calculation are as follows (the amounts are only indicative since they keep changing year after year):
The tax scales for individuals are as following:
a. An Income to the tune of approximately ¢200,000.00 a month is exempt form taxes.
b. An income tax of 10% tax is levied on an income greater than ¢200,000.00 up to ¢325,000.00 (approx.).
c. An income tax of 15% is levied on incomes in excess of ¢325,000.00.
While there a re no exemptions in the income tax for corporations, some deductions from earnings are allowed. While the percentage of taxation is based on gross earnings, it is applied to net earnings for calculation of the actual amount of tax.
All corporations in Costa Rica pay a 30% tax on their annual earnings every year from 1st October of the previous year to 30th September of the present year.
The tax scales for corporations are as following:
a. An income tax of 10% is levied on amounts up to ¢13,000,000.00 in gross income.
b. An income tax of 20% is levied on amounts above ¢13,000,000.00 up to ¢29,000,000.00 in gross income.
All in all, the tax structure in Costa Rica is simpler compared to most countries and we can offer our best services in help you pay your taxes by calculating, filling up the necessary forms and undertaking the required formalities.
Te mereces lo mejor en la vida porque se lo han ganado. Así que si usted está buscando un lugar donde usted puede retirarse en paz y disfrutar de las bondades de la naturaleza y la vida, entonces tenemos el más apropiado para usted.
El sistema fiscal de Costa Rica es diferente a cualquier parte del mundo. Con áreas como las ganancias de capital totalmente exentos de impuestos. Podemos ayudarle a lograr sus objetivos empresariales y de inversión de manera más eficiente.