Foreigners are granted equal rights as residents and can own land in Costa Rica without restriction or prejudice of any kind.

CAPITAL GAINS TAXES

Presently, there are no capital gains taxes in Costa Rica.

However, we recommend that all tax questions or issues should be posed to the local authorities as tax regulations can change periodically.

PROPERTY TAXES

The property tax rate is 0.25% of the assessed value of the property. The assessed value is by law the contractual value of the property. Although there are ways in which the value of the property could be “self” assessed , we suggest that you follow the stated laws and assign the contract amount as the new value of the property. The contractual value of the property must be the value recorded to pay the transfer taxes when completing the transaction. You may be persuaded to register fictitious values to save on the tax, but this practice not recommended for the following reasons:

• You can legally be charged with Tax fraud in Costa Rica.
• If there was ever any legal situations regarding your property, the value of the property would legally be the registered value, and would be the only value recognized in a court of law.
• If a capital gains tax is implemented, the fictitious lower value of the property would result in enormous profits upon selling.

Property taxes in Costa Rica are remarkably low as is. Under the current system, one would pay $625 annually of a property valued at $250,000. For the sake of your investment and the country, it does not make much sense to nickel and dime around and suffer any repercussions of recording an improper land value.

INCOME TAXES

The maximum income tax rate for a full-time salaried employee is 19% and the corporate and private individual tax ceiling is 30%.

PROPERTY SALES CLOSING NOTARY FEES

The closing notary fees are legally set at maximum of 1.5% of the sales price. This fee is generally shared equally by both buyer and seller, yet any condition or term can be negociatied between the two parties and agreed to contractually. This fee can also be negociated on a case by case basis with your respective legal representative to a lower value (generally 1.25%).

PROPERTY TRANSFER TAXES

The property transfer tax is approximately 3% of the property value and is paid to your attorney at closing. It is generally expected that buyer pay this tax, however like most of these taxes, it is negotiable. In any case expect that the buyer will pay this 3% transfer tax.

PROPERTY OWNERSHIP REGISTRATION

Property registration in Costa Rica is done through the “Public Registry” (Registro Publico) and is secure. The Public Registry system in centralized and can be accessed publicly. As a purchaser, it is recommended that you advise your attorney to look up your property of interest in the Public Registry before beginning any negotiations.

CONSTRUCTION ZONING RESTRICTIONS

Generally these restrictions are rare and are usually focused towards structures over 5 storeys’ high. As the country developes and modernizes its city and development planning practices, these restrictions may become more prevalent. It is recommended that you verify the zoning restrictions in your area of interest. Costa Rica Estates can provide you this information with respect to our listed properties.

REAL ESTATE BROKERS/ AGENTS

Unlike North America, real estate is not a regulated business in Costa Rica. Thus “brokers” are not required to have a liscence to practice. That being said, there is a highly recognized and repulatble governing body called the CCCBR (Costa Rican Chamber of Real Estate brokers). The CCCBR is working in conjunction with the government of Costa Rica to pass legislation and regulations prohibiting non-liscneced borkers from practicing in real esate and enforcing a formal licensing to help regulate in the industry and enforce a code of ethics. Of the brokers currently accredited with a CCCBR license, the majority are Costa Rican Nationals. All of Costa Rica Estates’ Sales Representatives are licensed and recognized under the code of ethics and regulations for Real Estate Agents in Canada.