Corporate Income Tax for Businesses Companies operating in Costa Rica face a flat corporate income tax rate of 30% on their taxable profits, which applies to net income after allowable expenses. For example, a foreign contractor invoicing a Costa Rican company for professional services may see part of the payment withheld until the corresponding tax is settled.
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The Free Trade Zone regime allows companies engaged in exports and specific services to be exempt from income tax on foreign-source profits while operating inside designated zones. This rate is competitive within the region and forms the core of the country’s business taxation framework.
You may also benefit from reductions based on family dependents, mortgage interest under specific conditions, and contributions to approved private pension funds. Understanding how income taxes work in Costa Rica is essential for anyone considering a move, investing, or running a business in the country.
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Royalties, technical services, interest, and management fees often fall under this category, with rates commonly set at 15%, although treaties may lower them. Once classified as a resident, you are subject to tax on your worldwide income, meaning earnings generated both inside and outside Costa Rica can be taxable here.
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