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I wrote this blog about Corporation Tax Costa Rica originally on January 1st, 2016. Since 2016, many things have happened with the Corporation Tax Costa Rica.
Everything I wrote at the time has changed and we’re now in September 2019. So it’s time for an update.
For many years, lawyers in Costa Rica recommended property buyers to hold property ownership in a corporation. I’m not going to get into this now, but you can read up on that here. Also, it’s interesting to read what attorney Rick Philps thinks about holding assets in a corporation from now on, click here.
Everything that has to do with corporations and corporation tax Costa Rica has changed since 2016. So, I decided to re-do this blog entirely, so you don’t have to go through all those old blogs again.
Some owners of property in Costa Rica don’t even know that a corporation tax (impuesto a las personas jurídicas) was created in December 2011 through tax law No 9024.
When and what to pay
The Corporation Tax Costa Rica has to be paid every year, the first 30 days after January 1st. Check here how much.
For 2019, the basic salary of ¢446,200 is used. For 2019, the tax to pay is:
a) 15% of the basic salary for those corporations not registered in RUT (inactive corporations) = ¢66,930
b) 25% of the basic salary for those corporations that pay income tax, with a gross income of less than 120 basic salaries. – impuesto sobre la Renta (active corporations) = ¢111,550
c) 30% of the basic salary for those corporations that pay income tax, with a gross income between 120 and 280 basic salaries = ¢133,860
d) 50% of the basic salary of those corporations that pay income tax, with a gross income of 290 salaries or more = ¢223,100
Where to pay
You can pay the Corporation Tax Costa Rica at
– Banco de Costa Rica
– BAC San José
– Coopenae
– Banco Nacional de Costa Rica
If you’re not in Costa Rica, or you don’t have an account at the above tax collecting banks, you will need assistance to pay.
Assistance
Before you read any further, if you are not a citizen or resident of Costa Rica, and you own a corporation, you should click on the banner below. It’s important to understand, that if you own a corporation in Costa Rica, you have many more obligations now than you had before. These obligations include
- Registering form D140
- Paying annual corporation tax
- Filing shareholders with the Central Bank
- Mandatory digital signature
- and various others
Then you’ll find out, without having to read a lot, that you will need the services of a third party to comply with all your obligations.
Confiscation of assets
Those corporations, who have not paid the Corporation Tax Costa Rica, including 2015, have probably been dissolved by the National Registry by now. You will first need to check if that happened and attorney Roger Petersen’s video shows you how to do so. Also, learn more about dissolved corporations here.
If you owe corporation tax, you can pay it at the Banco de Costa Rica. Most corporations that not have paid the tax for 3 consecutive years were dissolved by the Costa Rican government except for those with assets, but the tax debt will still be owed by the legal representative.
But, if your corporation owns any assets, the government will have to put a legal mortgage on your property. If that has happened, you should contact your lawyer.
Income tax
Corporation Tax Costa Rica is not the same as capital gain tax or income tax for corporations. The Corporation tax is a fixed annual fee that you pay to have a corporation. If the corporation is used, the tax is a bit higher than for a dormant corporation. Functioning corporations also pay income tax, unless it is used to only hold assets such as real estate or vehicles.
How to dissolve your unused corporation
If you still own a corporation but are not using it and don’t want to keep paying the corporation tax every year, read this article carefully.
If you don’t know what to do, contact your attorney. Are planning to purchase property in Costa Rica? Then ask your attorney about the advantages and disadvantages of holding your assets in a corporation and what your options are.
Looking to purchase a property in the Central Valley of Costa Rica? Then I suggest you hire the experts, contact us now.
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I DO want to remind our readers that we appreciate any referrals you can send us. Also, when talking about your home in Costa Rica, please remember the GoDutch Realty agents. We appreciate it.
