Costa Rican Law: In the states, our legal system is based on Common Law whereas Civil Law is used in Costa Rica. This is an important distinction to make in regard to how judges make decisions and how contracts are written. Civil Law is more restricted with less interpretation by the judges. Precedent is not necessarily a factor and may be considered or viewed only for clarification purposes. The Supreme Court or Sala Cuarta, is the exception and will hear cases where the lower courts were restricted to rule only on provis ions provided in the civil code.

Written contracts in Costa Rica are of a simpler form than their stateside counterparts. Contracts include only what the law does not already state. Under Common Law, contracts are more specific and detail oriented since they must allow for as little interpretation as possible.

Protection of Private Property:

ou may ask, Can the government take my property from me? Yes, it is possible, but very difficult. One thing to understand is that there are similar conditions we find even in the United States and other countries where the government has and can expropriate private property for public interests, i.e. roads, easements, protected areas, etc. There have been cases in the past where the Costa Rican government has expropriated lands for national parks and protected areas, however these are the exception and not the rule. Especially today with new constitutional procedures where the government must legally demonstrate public interest and justly compensate the landowner. Article 45 of the Costa Rican Constitution guarantees equal rights and protection of private property, be it owned by nationals or foreigners.


Income Tax – Costa Rica is a source jurisdiction from an income point of view. Residents, non-residents and corporations generally are subject to tax only on their Costa Rican source income. For this reason, Costa Rica offers no credit for foreign taxes paid on foreign source income by Costa Rican residents or non-residents. Tax Rates – 30% on corporations / 30% catch-all rate on non-residents, and a graduated scale of 10% – 25% for nationals depending on the type of income source. There is no capital gains tax in Costa Rican unless the income is derived from habitual activities. An individual or corporation can sell 2 properties in one fiscal year without being subjected to capital gains. However, if 3 or more properties are sold, you would be subjected to capital gain taxes on all properties! National sales tax is 13%. Property taxes are 0.025% of the declared property value. Taxes on concession properties within the Maritime Zone properties are 3% of the property value – a significantly higher tax rate!

Immigration: Under certain conditions, Costa Rica allows foreigners to gain residency status. This is not to be confused with citizenship. Being a Costa Rican resident allows certain benefits while you reside here but still maintain your foreign citizenship. Foreigners living in Costa Rica on a tourist visa do not necessarily qualify for residency as they must first meet certain requirements (listed below). As a tourist, your visa must be renewed every 90 days (depending on the country of origin) by checking out of the country for 72 hours.

Aside from not have to renew your tourist visa, benefits of residency include access and discounts on some public services like health care, insurance, and education.

In years past, Costa Rica was a haven for retirees, offering foreign residents certain incentives like importation of household goods and a vehicle exempt from import duties. These incentives were discontinue several years ago. Today, benefits are few unless you qualify through an investment scenario.

NOTE: You can own property as a foreigner and live here on tourist visa.

One of the confusing issues is gaining residency but also have the right to work

Working status is not part of your residency and is given only under special circumstances, like an investment scenario. This requires a lengthy and bureaucratic process so be sure this something necessary to your plans or project.

Qualification categories are as follows:

  • Pensionado Status You must demonstrate a permanent income from a retirement source such as a pension. The minimum amount is $1000 per month and you must reside in the country for a at least 6 months each year.
  • Rentista Status – This is for individuals who do not have retirement income but can show income from other capital investments. You must provide documentation that you receive a minimum of $2,500 each month for a period of at least five years. You must also change this amount into colones through the Costa Rican National Banking System.
  • Investor Status – Those making a minimum investment of $200,000 can qualify for residency if the investment is made in a priority industry such as non-traditional exports or tourism. Residency along with other incentives are offered with investments of $100,000 in reforestation projects or $200,000 in non-priority industries. Ask your attorney for further details.
  • Permanent Residency – is usually reserved for people who marry Costa Ricans, have a child born in Costa Rica, or are seeking political asylum.
  • Temporary Residency – is regularly awarded to people employed by international companies or students and teachers participating in official exchange programs with the Costa Rican Universities.

In all cases, you must provide a series of documentation from your home country such as certificate of birth, marital status, police report, photos, income certification, etc. All documents must be certified by the Costa Rican Embassy in your home country and then translated here in Costa Rica. Fingerprints and a written declaration are taken in Costa Rica at the immigration office. If you solicit for investor status, you will be required to provide a financial study of your project. If the project involves real property, you must provide proof of ownership. In theory, the process should only take a few months but this would be an exception. Some cases can take up to a year or more depending much on the efficiency of your lawyer.

Our Advice: Most attorneys will do immigration work but very few specialize in it. It is best to talk to an immigration specialist to see if you qualify before getting started.