Costa Rica
Top Income Tax
25%
Marginal rate
Corporate Tax
30%
Standard rate
VAT / Sales Tax
13%
Standard rate
Capital Gains
15%
Standard rate
Overview
Costa Rica offers territorial taxation, meaning foreign-source income is not taxed. The country is famous for its biodiversity, stable democracy, and Pura Vida lifestyle. The digital nomad visa was introduced in 2022 and has attracted many remote workers to beach towns like Tamarindo and Santa Teresa.
Income Tax Brackets
| Income Range (CRC) | Tax Rate |
|---|---|
| 0 - 4,181,000 | 0% |
| 4,181,000 - 6,244,000 | 10% |
| 6,244,000 - 10,414,000 | 15% |
| 10,414,000 - 20,872,000 | 20% |
| 20,872,000+ | 25% |
CRC annual amounts. Territorial taxation - only Costa Rican-source income taxed.
Corporate Tax
Standard Rate
30%
30% standard. Progressive rates for SMEs: 5% on first 5.6M CRC, 10% up to 8.4M, 15% up to 11.2M, 20% up to 22.4M.
VAT / Sales Tax
Standard Rate
13%
Reduced Rates
1%, 2%, 4%
13% standard. Reduced rates on healthcare, education, some foods.
Capital Gains Tax
Standard Rate
15%
15% on capital gains from 2023. Previously capital gains were not taxed.
Social Security Contributions
Employee
10.5%
Employer
26.5%
Self-Employed
10.5%
CCSS (social security). High employer burden covers health, pension, workers' comp.
Special Tax Regimes
Free Trade Zone Regime
Various tax incentives including 0% corporate tax for qualifying companies for up to 12 years.
Eligibility: Must invest minimum amount and create jobs in designated free trade zones.
Digital Nomad Visa
Digital Nomad Visa. Must earn at least USD 3,000/month (or USD 5,000 for families). Valid 1 year, renewable once.
Pros & Cons
Pros
- Territorial taxation (foreign income tax-free)
- Stable democracy
- Digital nomad visa
- Beautiful natural environment
- No army
Cons
- High employer social security costs (26.5%)
- 30% corporate tax
- New capital gains tax
- Limited infrastructure in rural areas
- Relatively high cost for Central America
Living Indicators
Cost of Living Index
Moderate
Quality of Life Index
Good
Best For
Data Sources
Tax rate data for Costa Rica is compiled from the following authoritative sources:
- OECD Tax Database
- Tax Foundation International Tax Competitiveness Index
- World Bank Business Enabling Environment
- Costa Rica government tax authority publications
- PwC Worldwide Tax Summaries
Last verified: 2024-01
Disclaimer: This content is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making decisions about your tax residency or obligations.