Costa Rica Tax Rates
Costa Rica operates a territorial tax system administered by the Dirección General de Tributación (DGT). Only income sourced within Costa Rica is subject to taxation, making it attractive for expatriates and international workers. Personal income tax is progressive with a top rate of 25%, corporate tax is 30%, and the VAT rate is 13%. Costa Rica reformed its tax system in 2019 with the introduction of a modern VAT replacing the previous sales tax.
Top Income Tax Rate
25%
Corporate Tax Rate
30%
VAT / Sales Tax
13%
Capital Gains Tax
15%
Detailed Tax Information
Income Tax Brackets
Costa Rica imposes a progressive personal income tax on employment income with five brackets ranging from 0% to 25% (annual amounts). Self-employed individuals and businesses are taxed under separate schedules. Under the territorial system, only Costa Rican-source income is taxable. Foreign-source income is exempt regardless of residency status. Deductions are limited but include a personal credit, dependent credits, and social security contributions. The 2019 tax reform (Law 9635) modernized the tax system, introducing VAT and expanding the tax base.
| Income Range | Tax Rate |
|---|---|
| ₡0 – ₡4.6M | 0% |
| ₡4.6M – ₡6.8M | 10% |
| ₡6.8M – ₡11.4M | 15% |
| ₡11.4M – ₡22.8M | 20% |
| ₡22.8M+ | 25% |
Corporate Tax
Costa Rica imposes a 30% corporate income tax on Costa Rican-source income for companies with gross income exceeding CRC 112,170,000 annually. Reduced rates apply to smaller companies: 5% for gross income up to CRC 5,761,000, 10% for income up to CRC 8,643,000, 15% for income up to CRC 11,524,000, and 20% for income up to CRC 112,170,000. Companies in Free Trade Zones benefit from income tax exemptions of up to 100% for the first 8 years and 50% for the following 4 years. Monthly advance tax payments are required.
Standard Rate
30%
Small Business Rate
5%
Capital Gains Tax
Costa Rica introduced a capital gains tax in 2019 as part of the tax reform (Law 9635). Capital gains from the sale of assets (real estate, shares, and other investments) are taxed at a flat 15%. Previously, capital gains were not taxed in Costa Rica. The sale of a primary residence remains exempt. For real estate, a 2.5% withholding applies on the gross sale price as an advance payment toward the 15% capital gains tax. Losses can offset gains from the same category of assets.
Short-Term Rate
15%
Long-Term Rate
15%
Rate
15%
VAT / Sales Tax
Costa Rica introduced a 13% value-added tax (IVA) in July 2019, replacing the previous 13% general sales tax. The new IVA expanded the tax base to include services, which were previously largely untaxed. Reduced rates apply to essential goods and services: 1% for basic food basket items, 2% for medicines, and 4% for private health services. Education, public health services, and exports are zero-rated. Financial services and residential rentals below a certain threshold are exempt. Monthly IVA returns are required.
Standard Rate
13%
Cryptocurrency Tax
Costa Rica does not have specific cryptocurrency tax legislation. Under the territorial tax system, crypto income would only be taxable if considered Costa Rican-source income. The Central Bank of Costa Rica has stated that cryptocurrencies are not legal tender and not backed by the government. In practice, crypto gains from international platforms would likely be treated as foreign-source income and thus exempt from Costa Rican taxes.
Tax Treaties
Costa Rica has a limited network of approximately 5 double taxation agreements in force. The country has been working to expand its treaty network and joined the OECD in 2021. Costa Rica participates in the Global Forum on Transparency and Exchange of Information for Tax Purposes and exchanges information under the Common Reporting Standard (CRS). Tax Information Exchange Agreements exist with additional countries including the United States.
Treaty Network
5
Double taxation agreements
Major treaty partners:
Key Details
Relocate to Costa Rica
See how much you could save by moving here from your current country.
+$14K
Tax in United States
$24K
24.4% effective
Tax in Costa Rica
$11K
10.5% effective
You Save
56.9%
less tax annually
US Citizens: Important Note
US citizens are taxed on worldwide income regardless of residence. You'll still need to file US taxes, though the Foreign Earned Income Exclusion and Foreign Tax Credit may reduce your liability.
