Costa Rica Property Tax

Costa Rica offers a significant tax advantage over North America, and it's wise to calculate that saving when you compare property prices in Costa Rica and at home.

Private residences are taxed at an annual rate of 0.25% of the assessed valuation. The valuation, however, will almost always be far less than you actually paid for the property.

Taxes on a $150,000 house are typically only a few hundred dollars a year. Owners are also spared high taxes when they sell, because there are no capital gains taxes in Costa Rica.

Other taxes are also low:

Income Tax

Only income derived in Costa Rica is subject to taxation. The highest rate is 15%, which is levied on monthly income above 324,100 colones, or $613. In some cases, you may be able to lower local taxes by forming a corporation in Costa Rica. Corporations pay a higher income tax rate--20% or 30%, depending on its size. But corporations can deduct many expenses from their earnings.

Sales Tax

13%. Transfer taxes also apply to the sales of property and vehicles. In the case of property, these taxes are very low. The transfer tax on cars is 1.5%.

Foreign Earned Income Tax credit or exclusion up to $80,000.00:

This is a tax benefit that the US offers to citizens living abroad. You must of course consult with accountant.

We are not offering Tax advice and advise all new residents and investors to consult with your own accountant. We can recommend several North American based Accounting Firms who handle foreign asset protection and tax liability.