Countries › Costa Rica › Guide › 15. Exiting › Closing a branch of a foreign company in Costa Rica: the general power of attorney, final remittance tax and the tax on legal entities until cancellation

Closing a branch of a foreign company in Costa Rica: the general power of attorney, final remittance tax and the tax on legal entities until cancellation

Last verified: 2026-10-30 · Status: Stable

A foreign company with a branch must keep a general attorney in Costa Rica for the branch's business for as long as it operates, and anyone doing business for a foreign company without registered powers is jointly liable for the obligations. Profits the branch remits to head office are taxed on 100% of disposable income, and the branch pays the yearly tax on legal entities until its registration is cancelled; three unpaid years cause its dissolution. Registry filings to close the branch need it to be current with the CCSS and the tax on legal entities.

USD figures use the Banco Central de Costa Rica reference selling rate of ₡454.82 per US dollar published for 29 October 2026 (indicator 318 on bccr.fi.cr), rounded to the cent. The salario base for 2026 is ₡462,200 (Circular 246-2025 of the Consejo Superior del Poder Judicial, under Ley 7337 art. 2).

Key facts

General attorney required while a branch operates	Yes Código de Comercio art. 226, as of 2026-10-30 · in force
Tax on legal entities, top bracket 2026	231100 CRCLey 9428 art. 3(d), as of 2026-10-30 · in force
Unpaid years of tax on legal entities causing dissolution	3 consecutive periodsLey 9428 art. 7, as of 2026-10-30 · in force

The rule

1. Foreign companies that have or open branches must constitute and maintain in the country a general attorney (apoderado generalísimo) for the branch's business; the power states the branch's object and assigned capital and submission to Costa Rican laws and courts for acts in the country.Ley 3284, Código de Comercio, as amended by Ley 4625, art. 226, 1970-07-30 official text · verified 2026-10-30

2. Whoever announces or does business as agent or representative of a foreign person or company without documents showing registered powers is jointly liable for obligations contracted and to be performed in the country.Ley 3284, Código de Comercio, art. 233, 1964-04-30 official text · verified 2026-10-30

3. The tax on legal entities applies to every branch of a foreign company or its representative registered in the Registro de Personas Jurídicas, accruing on 1 January each year and payable within the first 30 calendar days; in 2026 a branch not registered with the tax administration pays 15% of a salario base and registered branches 25%, 30% or 50% depending on gross income.
Cost to do it: ₡69,330, ₡115,550, ₡138,660 or ₡231,100 in 2026 (US$152.43, US$254.06, US$304.87 or US$508.11).Ley 9428, art. 1, art. 2, art. 3 and art. 4, 2017-03-21 official text · verified 2026-10-30

4. Failure to pay the tax on legal entities for three consecutive periods is a cause of dissolution of the branch; the tax administration can pursue collection against the last officially registered partners, who become jointly liable.Ley 9428, art. 7, 2017-03-21 official text · verified 2026-10-30

5. 100% of the disposable income that branches and other permanent establishments of non residents credit or remit to head office is taxable income, withheld on behalf of the head office.
Example: Final remittance of ₡12,000,000 of after tax branch profit: ₡1,800,000 at 15%. / US$26,384.06 remitted, US$3,957.61 tax.Ley 7092, art. 27 ter(2)(a)(iv), 2018-12-03 official text · verified 2026-10-30

6. To register any document in the mercantile registry, a legal entity must be registered and current with the CCSS; registry certifications and registrations are refused to entities in arrears with the tax on legal entities.Ley 17; Ley 9428, Ley 17 art. 74(2); Ley 9428 art. 5, 2017-03-21 official text · verified 2026-10-30

7. Taxpayers that cease activity must deregister within one month of ceasing; pending obligations and proceedings survive deregistration for the limitation period.Decreto Ejecutivo 38277, Reglamento de Procedimiento Tributario, art. 24, 2016-01-28 official text · verified 2026-10-30

Worked example

A Panamanian company closes its Costa Rican branch in November 2026. It pays the 2026 tax on legal entities already due, remits the last ₡12,000,000 (US$26,384.06) of after tax profit with ₡1,800,000 (US$3,957.61) withheld, settles CCSS, deregisters with Hacienda within a month of stopping activity, and records the branch cancellation and revocation of the general power.

Step by step

Stop new business; settle employees and suppliers.
Pay CCSS and the tax on legal entities so the registry accepts filings.
Remit final profits with 15% withholding.
Deregister with Hacienda within one month of ceasing.
Register the head office decision closing the branch and revoke the general power.

Common traps

Leaving the branch registered keeps the yearly tax on legal entities running into January.
Acting for the foreign company after revoking the power exposes the agent to joint liability (art. 233).

Sources

← Merging, converting or moving the seat of a Costa Rican company: one month opposition window, tax neutral reorganisations and retransfer of a foreign seatClosing a business in Costa Rica and the workforce: notice, cesantía up to eight years, vacations and aguinaldo, and the labor privilege in liquidation →

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