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Apr 06, 2017

Progressive income
tax rates in Costa Rica


INDIVIDUAL TAXATION

Nonresident individuals are liable to tax only on their Costa Rican-sourced income. Married couples are taxed separately.

The tax year runs from 01 October of the current year to 30 September of the succeeding year. The tax year 2016-2017 is from 01 October 2016 up to 30 September 2017. The tax year 2017-2018 is from 01 October 2017 up to 30 September 2018.

INCOME TAX (Impuesto sobre las remesas al exterior)

Income is taxed at progressive rates. Income earned by nonresidents is subject to withholding taxes.

Tax on All Income Other than Employment Income

Income from non-employment sources are taxed separately from employment income. Income-generating expenses are deductible when calculating the taxable income from business activities. Income tax is levied at progressive rates.

INCOME TAX 2016-2017

TAXABLE INCOME, CRC (US$) TAX RATE
Up to 3,517,000 (US$6,280) 0%
3,517,000 - 5,251,000 (US$9,377) 10% on band over US$6,280
5,251,000 - 8,760,000 (US$15,643) 15% on band over US$9,377
8,760,000 17,556,000 (US$31,350) 20% on band over US$15,643
Over 17,556,000 (US$31,350) 25% on all income over US$31,350
Source: Global Property Guide

CAPITAL GAINS TAX

Capital gains are not taxed in Costa Rica unless they are derived from habitual transactions.

Capital gains derived from habitual transactions are taxed at a flat rate of 30%.


PROPERTY TAX


Real Estate/Habitation Tax (Impuesto sobre bienes inmuebles)

Property taxes are levied on the cadastral value of the property as assessed by the tax authorities. Property taxes are levied by the municipalities at the flat rate of 0.25%. The real estate tax is calculated on a calendar year basis and must be paid annually, semiannually or quarterly, depending on the municipality.

CORPORATE TAXATION

INCOME TAX

Income and capital gains earned by companies are generally subject to corporate income tax at a flat rate of 30%. Income-generating expenses are deductible when calculating taxable income.

Small companies whose gross income does not exceed a particular limit may be subject to corporate income tax at progressive rates.

CORPORATE TAX 2016-2017

TAXABLE INCOME, CRC (US$) TAX RATE
Up to 52,634,000 (US$93,989) 10%
52,634,000 105,872,000 (US$198,057) 20% on band over US$93,989
Over 105,872,000 (US$198,057) 30% on all income over US$198,057
Source: Global Property Guide





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