2019 TAX REFORM FAQ
Part I:
On July 1, 2019, Costa Rica a major Tax Reform went into effect nationwide. The government did not provide enough information before July 1.
Tax Law
WHAT IS THE VALUE ADDED TAX (VAT)
The Value Added Tax (VAT) is an indirect tax that taxes the consumption, which means that when a person (customer) makes a purchase of a good or service, is paying this tax at a general rate of 13% or in any of the reduced rates of 4%, 2% or 1%.
NEW CAPITAL GAINS TAX IN COSTA RICA
With the approval of the Law #9635, among the taxes and changes that brought, it was created a Capital Tax Gains of 15% which applies to investment income and real estate.
ANNUAL CORPORATION TAX: DON’T FALL BEHIND
Do you own property or a business in Costa Rica?
Most expats form a corporation (SA or SRL )to purchase investment real estate or open a business.
TAX UPDATES
Pursuant to Executive Decree No. 41040-H dated April 5th, 2018, the Tax Administration establishes the mechanisms
2019 ANNUAL CORPORATE TAX
As of September1st, 2017 all corporations, subsidiaries, and limited liability companies that are currently registered before the National Registry
2019 ANNUAL CORPORATE AND REAL PROPERTY TAXES
As a real property and/or CR corporation owner, you should be aware of taxes that need to be paid annually. Those who do not pay may be subject to fines and judicial collection procedures
LUXURY HOME TAX
The so called ´Solidarity Tax´ for the Strengthening of Housing Programmes (Impuesto Solidario para el Fortalecimiento de Programas de Vivienda), Law # 8683, commonly referred to as the 'Luxury Home Tax'applies to houses, condos and apartments of which construction/building value exceeds a certain amount.
REAL ESTATE RENTALS WILL SOON BE SUBJECT TO THE SAME LEGAL REQUIREMENT FOR ELECTRONIC INVOICING (FACTURA ELECTRONICA) AS ALL OTHER TAXPAYERS IN COSTA RICA.
The transition to a mandatory electronic invoicing system for taxpayers got underway earlier this year, as an outcome of 2016 legislation 'to improve the fight against tax fraud' in Costa Rica. Under a 2018 schedule of phased-in compliance deadlines, Resolution No. DGT-R-51-2016
ANNUAL CORPORATE AND REAL PROPERTY TAXES
As a real property and/or CR corporation owner in Costa Rica, you should be aware about taxes that need to be paid yearly. Failure to pay them would generate penalties and lead to a collection process.