Failure to Pay Taxes in Costa Rica Could Result in Stiff Penalties

The General Directorate of Revenue (DGT) has announced that tax dodgers in Costa Rica will face stiff penalties if they do not accurately report their income. In fact, individuals who fail to report income from self-employment or from business operations could face up to $80,000 in penalties. It should be noted that not all self-employed individuals or business owners will be affected by the fine. Only those individuals who rendered professional services with a value of more than $100 or those who acquired goods with a value up to $5,000 will be affected.

Tax payers in Costa Rica must declare their income and expenditures by December 1st. According to the General Directorate of Revenue, only about 25 percent had done that by the end of November last year. Business owners or self-employed individuals who make late decorations may face fines beginning at $8,000, but could reach as much as two percent of their total gross income.

Self-employed individuals, business owners, and wage earners in Costa Rica earning more than about $1,500 per month were subject to the national revenue collection authority withholding last year. Workers earning less than this amount last year are exempt from income tax obligations. Due to the fact that most people in Costa Rica earn less than this amount, they are exempt from such required filings.
Other Tax Penalties in Costa Rica
Taxpayers in Costa Rica could also face a penalty known as impuesto sobre la renta, which is a failure to declare general income. This requirement affects more than half a million wage earners in Costa Rica. Taxpayers affected by this filing requirement have until December 15th to file and pay their taxes. Wage earners who fail to do so could face a fine of $400 in additional to interest.

The good news is that the tax filing process is primarily online in Costa Rica, making it easier for wage earners to handle their tax filing and declarations. It should be noted; however, that many people wait until the last minute and as a result, it is not uncommon for the DGT servers to crash in December.

John Wieland

John currently believes that this is the best time in history to being a buyer in Costa Rica. He studies global markets and the flow of funds meticulously and is seeing an upswing. He is currently working with Haute Living Magazine to promote a higher quality of luxury homes to discerning clientele throughout the US. He is rigorous in his pursuit to expand such marketing efforts and visits prominent markets like Los Angeles, Miami, New York and more to build upon his network of affluent brokers. As the President of Coldwell Banker Costa Rica’s nine offices, his #1 Priority for his franchisees’ is training. With an ever-changing industry, he carefully reviews the performance of each office and is committed to helping each succeed. He is committed to growing the brand in Costa Rica from nine offices by implementing systems and a useful business tools that brings all the offices together. A visionary and consummate professional, John saw the benefit of starting an alliance amongst other brokerages and in 2008, spearheaded Southern Pacific Alliance of Realtors (SPAR). Although this may be his most challenging work, the sustainability of this business model has already proven to be a tremendous success and benefit for the area brokers. He has built networks spanning multiple countries and is committed to providing the highest level of client service. John, a self-proclaimed wine snob, currently resides in Playa Uvita where he often chooses wine from his hidden stash while his wife prepares something fantastic to pair with it. They continue to travel and visited Spain and Germany and also enjoyed a trip to visit family in California & Arizona. He has purchased a couple properties this year and has plans to build their family home next year in Ballena. An avid golfer, he was able to tick off Torrey Pines in San Diego and PGA Championship in Palm Beach from his bucket list. He is currently reading such books like “The One Thing”, “Business Adventures”, “Tomorrow’s Gold” and “The Clipper Ship Strategy” while also finding time to play the guitar for his wife and daughter.” Keep an eye for his new love of writing on his blog and other various industry platforms.