Wednesday, February 19, 2020

Real Estate Tax Exemptions in Costa Rica

Properties with a value under ₡20.2 million are now exempt from paying real estate tax. In the case that your home is worth more and it is your only property, 0.25% on the excess is what is collected as tax.

The tax exemption applies if it is the only property owned. The exempt value varies from year to year and is calculated by multiplying the base salary established by the Supreme Court of Justice by 45. This salary in January 2020 was 450,200.

Some municipalities offer incentives to those who do have to pay tax for prepaying it. This can save 5.65%. This helps the municipalities with the problems faced from lack of timely payments.

The taxes go, in part, to administrative expenses of the local government, the Technical Standardization Body of the General Directorate of Taxation of the Ministry of Finance and the Administrative Board of the National Registry.

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