Countries › Costa Rica › Guide › 11. Real estate and land › Rental income tax in Costa Rica: 15% on rents with a flat 15% deduction

Rental income tax in Costa Rica: 15% on rents with a flat 15% deduction

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

Individuals and entities without a business activity pay tax on rental income as capital income: 15% on gross rent after a flat 15% deduction, an effective 12.75%. Landlords with at least one employee can elect to be taxed under the business income tax for five years. Rents paid to non residents are taxed under the remittance tax rules covered in the taxes section.

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.

Key facts

Tax on rental income (capital income regime)	15 %Ley 7092 art. 31 ter, as of 2026-10-30 · in force
Flat deduction on gross rent	15 %Ley 7092 art. 29, as of 2026-10-30 · in force
Effective rate on gross rent	12.75 %Ley 7092 art. 29 and 31 ter, as of 2026-10-30 · in force

The rule

1. Rentas del capital inmobiliario are income from leasing, subleasing or granting rights of use over real estate.Ley 7092, Ley del Impuesto sobre la Renta, art. 27 ter(1), 2018-12-03 official text · verified 2026-10-30

2. Capital income taxpayers are individuals, entities and investment funds receiving such income, unless taxed under the business tax (art. 1) or the remittance tax; a landlord with at least one employee may opt into the business tax for all real estate income, giving notice before the tax year and keeping it for five years.Ley 7092, Ley del Impuesto sobre la Renta, art. 28, 2018-12-03 official text · verified 2026-10-30

3. Taxable rental income is gross rent less a flat 15% deduction, with no proof and no other deductions; non financial real estate investment funds deduct 20%.Ley 7092, Ley del Impuesto sobre la Renta, art. 29, 2018-12-03 official text · verified 2026-10-30

4. The rate on capital income is 15%.
Example: ₡1,000,000 monthly rent: ₡12,000,000 a year, taxable ₡10,200,000, tax ₡1,530,000. / About US$26,384.06 rent a year and US$3,363.97 tax.Ley 7092, Ley del Impuesto sobre la Renta, art. 31 ter, 2018-12-03 official text · verified 2026-10-30

5. Where no withholding applies, capital income is declared and paid by the taxpayer within the first 15 calendar days of the month after it arises; regulations can allow quarterly or annual filing for recurring income.Ley 7092, Ley del Impuesto sobre la Renta, art. 28 quáter, 2018-12-03 official text · verified 2026-10-30

6. The capital income chapter took effect on 1 July 2019.Ley 9635, Fortalecimiento de las Finanzas Públicas, Title II effective date, 2018-12-03 official text · verified 2026-10-30

Worked example

A foreign resident individual rents a San José apartment at ₡1,000,000 (about US$2,198.67) a month. Annual gross rent is ₡12,000,000; after the 15% flat deduction the base is ₡10,200,000 and the tax is ₡1,530,000 (about US$3,363.97), 12.75% of gross. Because the rent exceeds ₡693,300 a month, 13% VAT also applies.

Step by step

Register with Tributación for capital income and VAT if rent exceeds the threshold.
File and pay as the regulations require for recurring rental income.
If you employ staff for the rental business, consider electing the business regime before the tax year, keeping in mind the five year lock in.

Common traps

Actual expenses such as interest and repairs cannot be deducted under the capital regime; only the flat 15%.
The business regime election lasts at least five years.
Rent paid to a landlord abroad follows the remittance tax and treaty rules, not this page.

Sources

← Short term rentals in Costa Rica: Ley 9742 registration with ICT and HaciendaSelling property in Costa Rica: 15% capital gains tax, 2.25% option and 2.5% withholding on non residents →

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