Categories: Blog
Each year in Costa Rica, corporations and real estate owners must comply with various tax filing obligations. At ERP Lawyers, we have prepared a 2023 liability schedule for Costa Rican Corporations and Real Estate Owners.
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JANUARY |
FEBRUARY | MARCH | APRIL |
OTHERS |
| Corporate Tax Payment
Value Properties Declaration and Property Tax Payment
Luxury House tax Declaration and Payment |
Education and Culture Stamp Payment | Transparency and Final Beneficiaries Declaration.
Statement of assets and liabilities for inactive legal entities. |
Resident Agent |
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| Ordinary Shareholder Meeting Celebration
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January
i. Corporate Tax Payment
All companies in the country are required to pay this tax as of January 1st of each year. Commercial companies forced to make this payment will have until January 31st to comply with it, without any charge of interest or fines.
The amounts to be paid this 2023 for inactive companies, which are those that are not registered before the Financial Ministry under any lucrative activity, will be the same as in 2022, which corresponds to the amount of ¢69,330 equivalent to approximately US$120; and, for active companies, depending on the gross income declared in the previous fiscal period, or according to whether they are taxpayers or not, they will pay as follows:
1. Companies registered as income taxpayers that declare zero income or have no activity and/or registered companies that have declared gross income of less than 120 base salaries, which is, less than ¢55,464,000, pay 25% of the base salary. This corresponds to the amount of ¢115,550.00, equivalent to approximately US$200.
2. Companies with gross income greater than 120 base salaries but less than 280 salaries, which is less than ¢129,416,000, pay 30% of the base salary, which corresponds to the amount of ¢138,660, equivalent to approximately US$240.
3. Companies with gross income greater than 280 salaries pay 50% of the base salary which corresponds to ¢231,100, equivalent to approximately US$395.
4. New companies: all those companies that are incorporated during the present year, will pay the corporate income tax proportionally, taking into consideration the date of their registration and the last day of the 2022 period.
To comply on time with this obligation is very important to avoid any financial penalties. From February 1st, there will be a fine of 1% per month elapsed. It is very important to take into consideration that companies with payment delays will not be able to make any transactions before the National Registry, nor contract with the State or any other public institution. Also, keep in mind that the non-payment for three consecutive periods of this tax will cause the company’s dissolution.
ii. Value Properties Declaration and Property Tax Payment
All those who have any property in the country are obliged to declare before the municipality where the property is located the purchase value of it. This must be done when acquiring the property and every five years thereafter.
The no declaration of the property´s value, entitles the municipality to charge a fine equivalent to the non-paid amount.
In addition, the payment must be made on a quarterly, semi-annual or annual basis as determined by the corresponding municipality. Such payment will be 0.25% of the value registered with the municipality as of January 1st of each year.
iii. Solidarity Tax Declaration and Luxury Home Tax Payment
By means of an Executive Decree, the Ministry of Finance establishes each year the corresponding tax parameters to be paid for the solidarity tax, better known as the Luxury Homes Tax Law.
This declaration must be made every three years within the first 15 calendar days of January. To avoid this obligation brings with it a minimum fine of three base salaries corresponding to ₵1,386,600, equivalent to approximately US$2350.00. This amount varies every year.
The exempted amount for this year is the sum of ₡148.000.000,00. This means that the owners of houses with a value higher than such amount are the ones obliged to pay this tax. It is very important to take into consideration that such amount is considered for the existing constructions within a property and the cost of the land must be excluded. The following are the tax brackets to be paid:
| Value | Tax % |
| Up to 371,000,000.00 | .25% |
| Over 371,000,000.00and up to 744,000,000.00 | .30% |
| Over 744,000,000.00 and up to 1,116,000,000.00 | .35% |
| Over 1,116,000,000.00and up to 1,490,000,000.00 | .40% |
| Over 1,490,000,000.00 and up to 1,859,000,000.00 | .45% |
| Over 1,859,000,000.00 and up to 2,333,000,000.00 | .50% |
| Over the excess of 2,333,000,000.00 | .55% |
February – March
iv. Education and Culture Stamp Payment
This payment must be made annually to the Ministry of Finance in February and March. It is a tax payable by all legal entities, based on the amount of net capital reported in the income tax return of the previous year. For those companies that are not income taxpayers, they must previously file the form “Official payment receipt D-110”. If the payment is not made on time, interest will be generated.
April
v. Transparency and Final Beneficiaries Declaration
It is a requirement in Costa Rica that all legal entities file with the Central Bank the declaration of Transparency and Final Beneficiaries. This declaration is a complete detail of all the shareholders that make up the capital stock of the company, as well as the beneficial owners of it.
This is an obligation that must be presented under three circumstances:
a. When a corporation is constituted for the first time.
b. If there is a change in the capital stock that equals or exceeds 15%, the declaration must be filed within the following 15 business days, counted from the date of the entry in the respective legal book.
c. If there is no change in the capital stock, the declaration must be filed annually during the month of April of each year.
The non-compliance with this obligation leads to a fine that ranges from 3 to 100 base salaries, for a maximum of ₡46,220,000.00, equivalent to approximately US$78,206.00.
vi. Statement of assets and liabilities for inactive legal entities
An inactive company is any company registered in the National Property Registry that does not carry out any lucrative activity registered with the Ministry of Finance, since they do not earn income from lucrative operations, but may have assets in their name, like vehicles and properties.
In Costa Rica, inactive companies must declare to the Tax Administration the value of their assets. That means the value of their assets or properties they have, minus the value of their liabilities or debts.
The presentation of this declaration is an annual obligation that inactive companies in our country will have to comply with.
Other Obligations
i. Resident Agent
All those companies that do not have an attorney-in-fact residing in Costa Rica must have a Resident Agent, who must be an attorney with an office open in the country whose function is to receive administrative and judicial notifications in the country.
ii. Ordinary Meetings
The shareholders of a company must hold at least one Ordinary Annual Meeting within three months after the end of the fiscal year, which refers to the fiscal period. At this meeting, the shareholders will discuss how the company has been managed, in case there are dividends, the distribution of profits is agreed upon, and if necessary, the appointment or revocation of the administrators is appointed or revoked.
It is of vital importance to comply with all these obligations. At ERP Lawyers we are at your disposal to help you with this matter.
