Like in other global markets, Costa Rica also has its share of annual taxes. Not all taxes are applicable to everyone.
Capital Gain Tax.
Due: At closing the sale of the property.
Since July 1st, 2019 the government applied the capital gain tax of 15%. If the property was acquired before that date the property owner has the one-time option to sell the property and pay a 2.25% tax on the sales price of the property.
If the property was your habitual residence, it will be exempt from paying the capital gains. Also exempt are businesses.
The law requires the BUYER to hold back 2.5% of the sales prices of the property to ensure that any capital gains tax is paid. This is to avoid a foreign property owner that does not have a domicile in Costa Rica from selling their property and not paying the capital gain tax.
Due: January 15th of each year.
The Luxury Tax (Solidarity Tax for the Strengthening of Housing Programs) only applies to houses, condos, or apartments over a certain construction value of (133,000,000.00 colones in 2021, approx. US$216,000 – this amount is adjusted each year).
Annual Corporation Tax
Due: January 31st of each year.
All corporations, subsidiaries, and limited liability companies that are currently registered before the National Registry will be subject to pay an annual tax. (Law # 9428: “Tax over legal entities”)
NOTE: The “annual corporate tax” is aside from the VAT Tax, or Income Tax, the corporation is subject to those indicated in the event the corporation is active and is registered as a taxpayer.
Property Tax & Garbage Collection
Due: March 31st of each year.
Property owners must pay Property Tax (Impuestos Bienes Inmuebles) and garbage collection fee (recolección basura) to the Municipal Government where the property is located.
The Property tax is 0.25% based on the inscribed value at the Municipality. It is the property owners responsibility to update the value every 5 years at the local Municipality.
The garbage collection is 3 times per week and the fee is a fixed amount, adjusted yearly, that must be collected along with the property taxes. The municipality determines the fee based on location and on whether the property is used for residential or commercial purposes. The fee can be paid quarterly or yearly and in 2021 the fee started at US$74 for residential and US$221 for commercial property for the entire year.
To ensure you do not incur any penalties or fines, it is important all applicable annual taxes are paid on time.