Taxes in Costa Rica
Costa Rica Offers Tax Advantages
In Costa Rica, the taxation of individuals is based on the principle of territoriality,meaning that all personal income, which has a foreign source, is tax exempt. Only revenue earned by an individual within Costa Rica is subject to an assessment by the tax authorities.
Income tax (Impuesto de Renta) is levied on both employment source income and non-employment source income.Every individual employed in Costa Rica must pay a monthly withholding tax that is based on his/her salary. Employment income (on a monthly basis) of individuals is subject to a progressive tax of 15%.
For the self-employed, the rates range from 10% to 25%.
Property transfer tax in Costa Rica
A property transfer tax of 1.5% is payable by the purchaser on the value of real estate purchased. This tax is triggered with the transfer of the property.
Sales tax in Costa Rica
Sales tax (the equivalent to VAT) stands at 13% and is levied both at the point of importation and at the point of sale (unless the sale is by way of export). It is levied on all goods with the exception of foodstuffs, medicinal products, and certain other items.
*Prices as of 2013
If you are looking to find out more about Costa Rica or other countries then sign up to our daily postcard e-letter. Simply enter your email address below and we’ll send you a FREE REPORT – Why Are Americans Still Flocking to Costa Rica.
This special guide covers real estate, retirement and more in Costa Rica and is yours free when you sign up for our IL postcards below.