Tuesday 22 June 2021

People Renting Houses and Apartments For Less Than A Month Must Pay Sales And Income Tax

Torres Paseo Colon

Q COSTA RICA – Rentals of houses, apartments and condominiums for a period of less than one month is subject to sales and income tax, indicates the Ministry of Finance (Ministerio de Hacienda) in a clarification of the new law to improve the fight against tax fraud, published in La Gaceta on December 20, 2016.

The tax man says that owners of properties must register as taxpayers of the two taxes, in order not to be subject to fines.

- Advertisement -

Alan Saborío, Managing Partner of Deloitte, explained that neither the rent of rooms nor of commercial premises (ie retail stores) are subject to sales tax. However, article 1 of the General Sales Tax Law, that calls for rents less than a month to be taxed, was subject to interpretation by the tax department.

For the Cámara Costarricense de Hoteles (CCH) –  Costa Rican Chamber of Hotels, who considered private rentals an unfair competition, see the clarification as “an achievement” given the struggle for equality the Chamber has fought. Hotel operators much charge the 13% sales tax on their rooms.

The CCH announced that it will begin, in coordination with the Ministry of Finance, an awareness campaign for property owners. No date was given for the start of the campaign.

According to Saborio, services offered by third-party, such as Airbnb and others who provide short-term rentals for property owners, are much easier to control.

- Advertisement -

In fact, last month, Airbnb offered to the government to collect and remit the sales tax on transactions in Costa Rica, but it would not give up (to the Ministry of Finance) its client (hosts or property owners) list.

Saborio said the big issue here is how to control the short-term rentals, collect taxes and apply sanctions.

The penalty for not complying with the new tax regulation is a fine of between 50% and 150% of the unreported income. In the event that the fine exceed 440 minimum wages, very unlikely to occur, the law establishes jail time.


Source La Nacion

- Advertisement -

We strive for accuracy in its reports. But if you see something that doesn’t look right, send us an email. The Q reviews and updates its content regularly to ensure it’s accuracy.

"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

Related Articles

Weather, friendly locals, cost of living: expats in Mexico, Costa Rica enjoy same things

EXPAT FOCUS (MND) Of course it was no surprise that readers...

Cynthia Ann Telles named new U.S. Ambassador to Costa Rica

QCOSTARICA - Today, U.S. President Joe Biden announced his nomination of...


Today’s Vehicle Restriction June 19: only “ODDS” can circulate

Today, Saturday, June 19, only vehicles with "ODD" ending plates CAN circulate The measure is countrywide and applied between 5:00 am and 9:00 pm, save...

Ortega government accuses imprisoned opponents of receiving money from the United States to overthrow him

TODAY NICARAGUA – The Nicaraguan government assures that the imprisoned political opponents detained on charges of “inciting foreign intervention” are “usurpers” financed by the...

Will that be Cash or Sinpe Móvil?

QCOSTARICA - Sinpe Móvil is easy to use. From your phone, you can send money to friends, family and pay for things. Or receive...

First five months of the year reflect recovery of Costa Rican exports

QCOSTARICA - The value of Costa Rica exports increased by 23% in the first five months of the year, being the highest growth in...

Informants assisted OIJ in corruption investigations, says the minister

QCOSTARICA - The investigation into alleged bribery of public officials in exchange for contracts for road works, received help from informants within the Consejo...

The United States will distribute 55 million vaccines against Covid-19 in Latin America, Africa and Asia

QCOSTARICA - The United States presented on Monday a plan to share 55 million doses of coronavirus vaccines worldwide, with approximately 75% of the...

Today’s Vehicle Restriction June 17: 7 & 8 CANNOT circulate

Today, Thursday, June 17, vehicles with plates ending 7 & 8 CANNOT circulate The measure is countrywide and applied between 5:00 am and 9:00 pm,...

Today’s Vehicle Restriction June 16: 5 & 6 CANNOT circulate

Today, Wednesday, June 16, vehicles with plates ending 5 & 6 CANNOT circulate The measure is countrywide and applied between 5:00 am and 9:00 pm,...

American woman found lifeless in hotel bathroom in Sabana

QCOSTARICA - A sad discovery occurred this Thursday morning in a hotel located in La Sabana, in San José, the lifeless body of a...


Get our daily newsletter with the latest posts directly in your mailbox. Click on the subscribe and fill out the form. It's that simple!

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.