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6. Taxes: Costa Rica

Taxes in Costa Rica: the 30% tax on Costa Rican source profits and the small company scale, 15% on dividends, interest and capital gains, final withholding of 5.5% to 30% on payments abroad, 13% VAT with reduced rates and VAT on digital services, the 20% of EBITDA interest cap, transfer pricing, loss carryforward, the four income tax treaties, CCSS payroll charges, customs, municipal taxes, the free zone regime and the audit and appeal process, each rule tied to the official text in SCIJ. For Argentine shareholders, the Argentine side of tax and FX questions is covered in The Argentine Thread guide.

Investor view. A territorial system, a 15% dividend withholding that drops to 5% for treaty parents, long free zone holidays and predictable SCIJ published rules make Costa Rica a competitive base for services and advanced manufacturing, rewarding investors who keep substance, transfer pricing files and monthly filings in order.

• Taxes in Costa Rica: 30% corporate income tax, 15% on dividends and capital gains, 13% VAT, withholding on payments abroad and municipal taxesCosta Rica taxes companies on Costa Rican source profits at 30%, with lower progressive brackets for small companies, and taxes dividends, interest and capital gains at a flat 15% under the capital in
• Corporate income tax in Costa Rica: 30% on Costa Rican source profits, small company brackets from 5%, prepayments and the 15 March returnCompanies, branches and other entities pay the tax on profits at 30% of taxable income from Costa Rican source activities; companies with gross income up to ₡119,174,000 apply brackets of 5% to 20%, a
• Withholding tax on payments abroad from Costa Rica: 15% on dividends, branch profits and interest, 25% on royalties and services, treaty ratesCosta Rican payers withhold a final tax when they pay, credit or make available Costa Rican source income to persons domiciled abroad: 15% on dividends, branch profit remittances and most interest, 5.
• VAT in Costa Rica: 13% on goods and services, reduced rates of 4%, 2%, 1% and 0.5%, reverse charge on services from abroad and monthly returnsLey 6826, as restated by Ley 9635 of 2018, charges VAT at 13% on sales of goods and services carried out in Costa Rica, including imports and services or intangibles bought from abroad by VAT taxpayer
• Transfer pricing in Costa Rica: arm's length rule, 25% related party test, annual return above 1,000 salarios base and five year APAsTaxpayers that transact with related parties in Costa Rica or abroad must price them at arm's length for income tax, and the tax administration adjusts only where the agreed price lowers or defers Cos
• Interest deduction limits in Costa Rica: 20% of EBITDA for net non bank interest, indefinite carryforward and no deduction without withholdingCosta Rica has no debt to equity ratio; instead, net interest expense is deductible only up to 20% of EBITDA (UAIIDA) each year, with the excess carried forward indefinitely within the same annual cap
• Tax losses in Costa Rica: three year carryforward, five years for agricultural, new industrial and audiovisual companies, no carrybackBusiness losses can be deducted in the three following tax years; agricultural companies, new industrial companies and qualifying film and audiovisual companies have five years. Losses must be booked
• Costa Rica's tax treaties: four income tax treaties in force (Spain, Germany, Mexico, UAE), the BEPS multilateral instrument and treaty ratesCosta Rica has four comprehensive income tax treaties approved by law: Spain (Ley 8888), Germany (Ley 9345), Mexico (Ley 9644) and the United Arab Emirates (Ley 9963), and it approved the OECD multila
• Capital gains tax in Costa Rica: 15% on gains, 2.25% of price option for older assets, 2.5% buyer withholding when non residents sell real estateGains on assets not used in a business, including shares, real estate and fund units, are taxed at 15% under the capital income chapter of Ley 7092; for assets acquired before the chapter took effect,
• Digital services tax in Costa Rica: 13% VAT on cross border digital services, collected by registered providers or by card issuersCosta Rica has no separate digital services tax: digital, telecommunications, radio and television services consumed in the country bear 13% VAT. Foreign providers and intermediaries can register with
• Local taxes in Costa Rica: 0.25% municipal property tax, the municipal business licence tax and the yearly tax on legal entitiesMunicipalities charge 0.25% a year on the registered value of land and buildings, value property at most every five years, and expect owners to file a value declaration at least every five years. Ever
• Payroll taxes in Costa Rica: CCSS health 9.25% and pensions 5.58% for employers in 2026, FODESAF, IMAS, INA, Banco Popular and the salary taxEmployers pay CCSS health insurance at 9.25% and pension (IVM) contributions at 5.58% of salaries from 2026 to 2028, plus FODESAF 5%, IMAS 0.5%, INA 1.5% (employers with at least five permanent worker
• Customs duties in Costa Rica: tariff plus 1% import tax on customs value, 13% import VAT and WTO valuationImports into Costa Rica bear the tariff duty of the Central American tariff schedule, a 1% tax on customs value under Ley 6946, selective or specific consumption taxes where applicable, and 13% VAT on
• Tax incentives in Costa Rica: free zone income tax holidays of 8 to 12 years, 6% and 15% rates for strategic manufacturers, and reductions for new SMEsThe free zone regime of Ley 7210 exempts beneficiaries from income tax at 100% for eight years and 50% for four more inside the Greater Metropolitan Area, or 100% for twelve and 50% for six outside it
• Tax audits and disputes in Costa Rica: four year review period, 50% to 100% penalties with voluntary reductions, appeals to the Tribunal Fiscal AdministrativoThe tax administration has four years to assess and collect, ten years for unregistered taxpayers, fraudulent returns or returns not filed. Understatements are penalised at 50% of the tax shortfall, 1

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