Tax system in Costa Rica
Costa Rica is primarily source-based. Income from activities carried out in Costa Rica is generally in scope, even if the customer or payer is abroad, while genuinely foreign-source income is generally outside the ordinary income-tax base.
Individuals use progressive salary or business-income brackets that reach 25%. Companies generally pay 30% on taxable profits, with a reduced schedule for qualifying small companies.
Costa Rica also applies 13% VAT, 0.25% municipal real-estate tax, a progressive solidarity tax on high-value homes, real-estate transfer tax and 2026 payroll contributions of 26.83% for employers and 10.83% for employees.
Tax rates at a glance
- Income tax
- 0% - 25%Progressive
- Wealth tax
- 0%
- Inheritance tax
- 0%
- Capital gains tax
- 15%
- Corporate tax
- 5% - 30%
- Dividend tax
- 5% / 15%
- VAT
- 13%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
Local operating businessesNearshore employersEmployees and professionalsExpats with Costa Rican-source incomeInvestors using Costa Rican substance
Watch out for
- Source matters more than the location of the bank account. Services physically performed from Costa Rica can be Costa Rican-source even when the client and payment account are abroad.
- Tax residence is generally connected to more than 183 days in the country during the relevant fiscal period, but residence does not turn Costa Rica into a simple worldwide-tax system.
- Costa Rica was removed from the EU list of non-cooperative tax jurisdictions in October 2023 and is not on the February 2026 list, but international reporting still matters.
- The 2026 solidarity tax can apply to residential, occasional or recreational property whose construction and fixed installations exceed ₡143 million.
Frequently asked questions
Is Costa Rica a territorial tax country?
Broadly, yes. Costa Rica taxes Costa Rican-source income, including many services performed in the country, while genuinely foreign-source income is generally outside the ordinary local income-tax base.
What is the highest personal income-tax rate in Costa Rica?
The highest 2026 salary and individual-business-income bracket is 25%. The thresholds differ between employees and people carrying on a lucrative activity.
Is Costa Rica a low-tax country?
It is moderate rather than universally low-tax. Personal income can reach 25%, standard corporate tax is 30%, and payroll, VAT and property taxes add materially to the total.