Luxury homes in Costa Rica have a yearly solidarity tax based on the value of the property. For 2021, the minimum threshhold to be considered a luxury home in Costa Rica, for tax purposes, starts at ¢133.000.000 colones which is approximately $222,000 and above. The tax rate ranges from .25% to .55% of the calculated value of the luxury home.
The Solidarity Tax for the Strengthening of Housing Programs in Costa Rica was established in 2009 and is based on the value of real estate for residential use, regardless of whether the luxury home is used on a regular, occasional or recreational basis, and includes both fixed and permanent installations.
The tax was created as part of a broader national program to finance housing options for people in extreme poverty in Costa Rica. Payment of this tax is not deductible for income tax purposes in Costa Rica.
|LUXURY HOME VALUE||TAX|
|¢133.000.000 to ¢335.000.000||0.25%|
|¢335.000.000 to ¢672.000.000||0.3%|
|¢672.000.000 to ¢1.008.000.000||0.35%|
|¢1.008.000.000 to ¢1.345.000.000||0.4%|
|¢1.345.000.000 to ¢1.679.000.000||0.45%|
|¢1.679.000.000 to ¢2.017.000.000||0.5%|
Paying the luxury home tax in Costa Rica
The luxury home tax in Costa Rica is declared every three years but its payment is annual. The tax must be paid within the first 15 days of the month of January of the following year.
The taxpayers of this tax can complete the declaration and payment through the Virtual Tax Administration portal for the Ministry of Finance of Costa Rica, called ATV.
Costa Ricans must use their identification number and foreigners who reside outside the country and who have a special tax identification number (NITE) or document of Migratory identification for foreigners (DIMEX) must use the electronic form for the presentation of the declaration. Foreigners who do not have a bank account in the Costa Rican financial system must make their payment by direct international transfer to the Ministry of Finance SWIFT account available on their website.
Real estate that is used on a regular, occasional or recreational basis, and with a value greater than ¢133 million (approx. $222,000) is subject to the payment of the Solidarity Tax for the Strengthening of Housing Programs.
Do foreigners have to pay this tax?
Foreign ownership of property in Costa Rica is very common. Any foreign citizen can validly own real estate in Costa Rica. They have the same rights and obligations as any Costa Rican citizen.
So, YES, if you’re a foreigner and own a home valued above $220K in Costa Rica, you’ll need to pay the luxury tax every year.
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