Properties for Sale in Costa Rica

Tax and Offshore Investment in Costa Rica

Tax regimes vary greatly throughout Latin America. While some countries are investor friendly, others are not so open. There are several benefits (i.e. retirement programmes, tax discounts) but also some tax obligations. In this section we provide an analysis of the different tax structure in each country where January First Real Estate lists properties. This information may be very important for you to choose you retirement destination or where to invest. Keep in mind that there are related visa and residence issues which are discussed in Visa/Residence Requirements. In case you need more information or have doubts on any of these issues, the specialised staff in January First Real Estate will be glad to answer all your questions, click here.

Real estate assets are, without doubts, one of the most secure and profitable ways of investment. There are two main reasons for this:

1. Properties always tend to increase their value in the long term.
2. They generate an income for their exploitation (rental/yields).

Taxes and Costs in Costa Rica

• Taxes and Costs
  Income Tax (Impuesto sobre las remesas al exterior)
  Income earned by nonresidents in Costa Rica which is remitted abroad is subject to a final withholding tax on the gross amount. The standard tax rate, which is applicable to rental income, is 30%. Husband and wife are treated separately for the purposes of assessing income tax on the non-employment sourced income of residents.
  
  Real Estate/Habitation Tax (Impuesto sobre bienes inmuebles)
  Property taxes are levied on the cadastral value of the property as assessed by the tax authorities. Property taxes are levied by the municipalities at the flat rate of 0.25%. The real estate tax is calculated on a calendar year basis and must be paid annually, semiannually or quarterly, depending on the municipality.
  
  Capital Gains Tax
  Capital gains are not taxed in Costa Rica unless they are derived from habitual transactions. Capital gains derived from habitual transactions are taxed at the standard income tax rate.
  
  Living There
  Residents pay tax on their worldwide income. Husband and wife are treated separately for the purposes of assessing income tax on the non-employment sourced income of residents.
  Self-employed individuals with business activities are allowed to deduct all costs and expenses necessary to produce taxable income, as well as to protect their investments. Income tax rates on non-employment sourced income are as follows:
  
  Income Tax
  Taxable Income, CRC (US$) / Marginal Tax Rate
  Up to 1,434,000 (US$2,698) / nil
  1,434,000 - 2,142,000 (US$4,031) / 10%
  2,142,000 - 3,573,000 (US$6,724) / 15%
  3,573,000 - 7,160,000 (US$13,473) / 20%
  Over 7,160,000 (US$13,473+) / 52%
  
  A number of family-related allowances can be deducted from non-employment sourced income:
  
• an annual tax credit of CRC6,720 (US$13) in respect of a spouse;
  
• an annual tax credit of CRC9,960 (US$19) in respect of a dependant under 25 years of age.
  

Costa Rica, make your dream investment come true.