This is general information on Costa Rica’s tax system for foreigners. However, please note that tax laws can vary depending on individual circumstances, so it is always advisable to consult a qualified tax professional for personalized advice.
- Tax Residency:
In Costa Rica, individuals are considered tax residents if they spend more than 183 days in the country within a calendar year. Tax residents are subject to tax on their worldwide income, whereas non-residents are taxed only on income earned in Costa Rica.
- Taxable income:
Income tax in Costa Rica is progressive, with rates ranging from 0% to 25%. Taxable income includes employment income, self-employment income, rental income, interest income, and capital gains. Deductions and credits are available, such as personal exemptions, health insurance premiums, and charitable donations.
- Value-added tax (VAT):
The VAT rate in Costa Rica is 13%. Most goods and services are subject to VAT, including food, clothing, housing, transportation, and professional services.
- Property tax:
Property tax is levied on the value of real estate in Costa Rica. The tax rate varies depending on the municipality, but it typically ranges from 0.25% to 0.55% of the property’s value.
- Other taxes:
Other taxes in Costa Rica include a sales tax on gasoline, excise taxes on tobacco and alcohol, and a stamp tax on legal documents.
- Tax filing:
Tax returns must be filed annually by March 15th of the following year. Non-residents who earn income in Costa Rica are required to file a tax return even if they do not meet the residency requirements.
- Penalties:
Penalties for failing to file tax returns or pay taxes on time can be severe, including fines and imprisonment. It is essential to comply with Costa Rica’s tax laws to avoid penalties and legal issues.
Again, please note that this is general information, and specific tax requirements can vary depending on individual circumstances. It is always advisable to consult a qualified tax professional for personalized advice.
