Property Taxes In Costa Rica
Do you have questions about taxes in Costa Rica when selling or renting properties? Here is a brief summary to guide you.
Capital gains tax in Costa Rica:
As of July 1, 2019, any real estate in Costa Rica that is sold pays capital gains tax. This tax is equivalent to 15% on the profit. The first time the property is sold after July 1, 2019, the seller will be able to choose whether to pay 2.25% of the property’s value or 15% of the profit. All subsequent sales will pay 15% on the profit.
Tax on residential rentals in Costa Rica:
Regarding housing rentals, rents greater than 669,000 colones per month approximately (the equivalent of 1.5 base salary) will pay 13% VAT. The tax applies to the entire monthly amount paid. Rentals below 669,000 colones do not pay the tax.
Tax on commercial rentals in Costa Rica:
In the case of commercial property rentals, 13% VAT applies to the entire rental without exceptions. Small and medium-sized companies may have a differentiated treatment if they are registered with the MEIC.
Transfer tax in Costa Rica:
The transfer tax is equivalent to approximately 1.5% on the value of the transaction.
Attorney fees in real estate transactions in Costa Rica:
Attorney fees are approximately 1-2% of the property’s sale value.
Real estate broker commission taxes in Costa Rica:
The real estate broker commission fee is also subject to the payment of 13% VAT on the commission. For example, if the commission is $1000, then it would be $ 1000 + 13% VAT for a total of $1130.
We suggest you consult with your lawyer, financial advisor and / or accountant on issues related to this law and how it applies to each particular case.