Countries › Costa Rica › Guide › 11. Real estate and land › VAT on real estate in Costa Rica: property sales, rents and construction

VAT on real estate in Costa Rica: property sales, rents and construction

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

Transfers of real estate already taxed by the 1.5% transfer tax are outside VAT, so sales of land and buildings carry no 13% VAT. Housing rents are exempt only up to 1.5 salarios base a month (₡693,300 in 2026); above that, and for commercial leases, 13% applies to the whole rent. Engineering, architecture and construction services have paid the full 13% since 1 September 2023.

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

VAT on sale of real estate	Not subject (transfer tax applies) textLey 6826 art. 9(3), as of 2026-10-30 · in force
Monthly housing rent exempt from VAT (2026)	693300 CRCLey 6826 art. 8(9); 1.5 salarios base, as of 2026-10-30 · in force
VAT standard rate	13 %Ley 6826 art. 10, as of 2026-10-30 · in force
VAT on construction and design services	13 %Ley 9635 Transitorio V bis, as of 2023-09-01 · in force

The rule

1. Transfers of real estate and registrable movables subject to the Ley 6999 transfer tax are not subject to VAT.Ley 6826, Ley del Impuesto al Valor Agregado, art. 9(3), 2018-12-03 official text · verified 2026-10-30

2. Leases of property used exclusively for housing, with garages and furniture rented together, are exempt if monthly rent is at most 1.5 salarios base; above that VAT applies to the full rent.
Example: 2026 threshold 1.5 × ₡462,200 = ₡693,300; ₡1,000,000 rent pays ₡130,000 VAT. / Threshold about US$1,524.34; VAT about US$285.83 a month.Ley 6826, Ley del Impuesto al Valor Agregado, art. 8(9), 2018-12-03 official text · verified 2026-10-30

3. Leases used by MEIC registered micro and small businesses and MAG registered small farms are exempt up to the same 1.5 salarios base, with VAT on the full rent above it.Ley 6826, Ley del Impuesto al Valor Agregado, art. 8(10), 2018-12-03 official text · verified 2026-10-30

4. The general VAT rate is 13%, which applies to commercial leases and lodging.Ley 6826, Ley del Impuesto al Valor Agregado, art. 10, 2018-12-03 official text · verified 2026-10-30

5. Engineering, architecture, surveying and civil construction services for CFIA registered projects were exempt until 31 August 2021, taxed at 4% to 31 August 2022 and 8% to 31 August 2023, and at the general 13% from 1 September 2023.Ley 9635, Fortalecimiento de las Finanzas Públicas, Transitorio V bis, 2020-09-10 official text · verified 2026-10-30 · changed: The phase in ended on 1 September 2023; construction services now pay 13%.

6. The salario base used by the property tax exemption, the VAT rent threshold and many fines is ₡462,200 for 2026.Corte Suprema de Justicia, Circular 246-2025 (salario base 2026), full text, 2025-12-17 official text · verified 2026-10-30

Worked example

A landlord rents a house for ₡1,000,000 a month. Because this exceeds ₡693,300, VAT of 13% applies to the full rent, ₡130,000 (about US$285.83) a month, on top of the capital income tax. A house at ₡650,000 would be fully exempt. If the landlord sells the house, no VAT applies, only the 1.5% transfer tax.

Step by step

Check the monthly rent against 1.5 salarios base each year when the salario base changes.
Register for VAT and invoice electronically if rents exceed the threshold or are commercial.
Budget 13% VAT on design and construction contracts.

Common traps

Crossing the threshold by one colón makes the whole rent taxable, not just the excess.
Commercial leases pay VAT regardless of amount, except for registered micro and small businesses under the threshold.
Short stays are lodging services taxed at 13%.

Sources

← Selling property in Costa Rica: 15% capital gains tax, 2.25% option and 2.5% withholding on non residentsZoning, subdivision and building permits in Costa Rica →

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