With its breathtaking natural beauty, affordable cost of living, and laid-back “Pura Vida” lifestyle, Costa Rica has become one of the most popular destinations for expats from around the world.
In this guide, we’ll walk you through everything you need to know about relocating to Costa Rica from a personal tax perspective, including tax residency, income tax, special tax regimes and tax return obligations.
TaxPilot recommend that you organize your affairs in good time to get ahead and make the most of favorable tax treatment while making sure you’re meeting your tax return obligations.
Costa Rica follows a territorial taxation model. You will pay tax on local sourced incomes only, irrespective of your resident status.
if you spend more than 183 days in Costa Rica during the tax year.
Providing that you hold the digital nomad visa, income will be exempt from Costa Rica taxation for two years. Costa Rica can be a very tax efficient place to live in and as such, Global Tax Consulting recommends seeking personalized tax planning advice to take advantage of the special tax regime.
Exempt from Costa Rica taxation.
Applied for two years.
Tax on property and share sales
Tax on value of owned assets
Tax on assets passed to heirs
Tax to contribute to state welfare
If you receive incomes overseas while you are living in the Costa Rica, you may find that the source country, as a starting point, continues to tax the income.
Double taxation agreements may remove the source country’s taxing right and thus, enable you to receive incomes tax free globally.
At present, Costa Rica has four double taxation agreements signed.
