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New criteria for calculating VAT in outsourcing services could raise costs

Businesses that outsource services must collect the VAT (Value Added Tax) from their clients on the total amount of the service and not only on the commission, as had been understood until now. This was indicated by Costa Rica's General Directorate of Taxation in responses...

It’s January and that means it’s “tax time”!

QCOSTARICA - The first month of 2021 has a calendar abundant in declarations and payment of taxes. Ten different tax forms, in fact, must be filled out and remitted to the General Tax Office. January has the peculiarity that, unlike other months, the payment of...

Taxation: collecting VAT does not mean legalizing Uber or DiDi

QCOSTARICA - Charging the Value Added Tax (VAT) does not make a business legal in Costa Rica, so says the Tax Administration of the Ministry of Finance. As of Friday, December 18, the trips made through technological platforms such as Uber and DiDi will be...

Uber and DiDi or watching Disney+ will be 13% more expensive from Friday

QCOSTARICA - Uber, DiDi, Disney +, Expedia, Booking, Despegar, and Aplaudir.com will, starting Friday, December 18, collecting from their customers the 13% Value Added Tax (VAT). That is the word from the General Directorate of Taxation (Treasury) on Monday, December 14. The Treasury's decision is based...

New step against evasion? The Treasury will have a closer look at taxpayers

QCOSTARICA -  Taxpayer movements with the Treasury will have more controls as of December 1, with the addition of the 13-digit code known as Cabys. As of December 1, taxpayers are required to add the Implementación Catálogo de bienes y servicios (CABYS) to their economic...

Distrust of sectors complicate signing an agreement with the IMF this year

QCOSTARICA - Reaching a structural adjustment agreement with the International Monetary Fund (IMF) this year seems like an impossible mission for President Carlos Alvarado, according to analysts consulted by La Republica. This, regardless of the fact that it is one of the few options the...

Bankers Oppose Lifting of Bank Secrecy

The Costa Rican Banking Association expressed its opposition to the proposal of the Minister of Finance, Rodrigo Chaves, to lift bank secrecy as one of the measures to reduce tax evasion. Chaves made the proposal, on Monday, February 10, before legislators, as one of the...

Costa Rica is on the verge of adopting one of its biggest changes in taxes

Starting July 1, 2019, the economic life of Costa Rican households and businesses will face changes. On this day, Costa Rica launches the Value Added Tax (VAT) - Impuesto al Valor Agregado (IVA) in Spanish. On this day important tax reforms will go into effect,...

The ‘Netflix Tax’ Will NOT Start On July 1; Amazon To Be Excluded From The VAT

Services such as Uber, Airbnb, and Netflix, among others,  will continue without the 13% Value Added Tax (VAT), according to a report by La Republica, at least while the Ministerio de Hacienda (Ministry of Finance) defines the list of companies to which the tax...

According to proposal, Airbnb would pay 13% VAT

According to PLN legisaltor Roberto Thompson, it is almost a fact that the Airbnb in Costa Rica will pay the 13% Value Added Tax (VAT) that goes into effect on July 1. The legislator commented that the legislative bill is on track and that in...

Costa Rica Banks Win Tax Lawsuit Against Hacienda

Costa Rica's banking sector won a lawsuit against the Ministerio de Hacienda (Ministry of Finance), arising from disagreements over the method used to calculate tax payments. The legal dispute dates back several years, since in 2003 the General Directorate of Taxation (DGT) validated the methodology...

Residential Landords Must Provide Electronic Invoices Starting September 1

Property owners renting a room, an apartment or a house, even if it is for a low amount, should start to issue a "factura electrónica" (electronic invoice) to their tenants starting September 1 of this year. Tax experts say starting in September, taxpayers who have...

Taxation Closed 35 Businesses In The Last Week For Tax Irregularities

Behind on your business taxes? The General Directorate of Taxation, of the Ministry of Finance (Ministerio de Hacienda), may be knocking on your door as it did this past week, yellow taping (closing down) 35 businesses for five calendar days in different parts of...

Tax Avoidance Is A Booming Industry

The so-called Paradise Papers may sound familiar – leaked documents from a law firm that specialises in offshore services reveal how the global elite avoids paying taxes. Even the name has the same ring to it as last year’s Panama Papers expose. But the...

Corret Income Tax for Foreigners Investing in Costa Rica Stock Market Is 8%

Since September 25, foreigners who acquire securities from the local stock market will have to pay 8% tax on the dividends generated, just like the tax paid by nationals, and not the 15% set previously. The differences that had arisen regarding how much and in...

Bill Proposed To Lift Bank Secrecy Law in Costa Rica

Bank secrecy (or bank privacy) prohibits banks in Costa Rica providing to authorities personal and account information about their customers without a court order. A bill that is being currently discussed in Congress would remove banking secrecy (or bank privacy) in the country, allowing the...

Costa Rica Improves Tax Evasion Controls

(QCOTARICA) The Directorate General of Taxation (Dirección General de Tributación) has hired an external service that cross matches taxpayer data in public databases to identify suspicious patterns that might suggest misconduct. The project called "Modelo Predictivo" (Predictive Model) started to be implemented by the Ministry...

Costa Rica: Personal Taxation

QCOSTARICA often gets inquiries about taxes in Costa Rica. For that we turned to Tax-News.com, a great source of tax information on Costa Rica and around the world. The following is their take on taxes of individuals in Costa Rica: In Costa Rica the taxation of...

Hacienda Insists On Seizures Without a Court Order

(QCOSTARICA) --The government insists on authorizing the Directorate of Taxation (Dirección de Tributación Directa) to seize assets and bank accounts of delinquent taxpayers, despite the lack of a court decision. However, on Monday, it backed down on giving Taxation the authority to take possession of...

Taxation Aims To Seize Property And Bank Accounts Without a Warrant

(QCOSTARICA) In an effort to reduce the estimated ¢58 billion colones in tax evasion, the government wants to empower the Directorate of Taxation (Dirección de Tributación Directa) to seize property and bank accounts of taxpayers, without and order from a judge. That's one of the...

Collection of Tax Liabilities Upfront

QCOSTARICA - The Attorney General's Office  (Procuraduría General de la República) is recommending to the Constitutional Court that it reject the appeal which seeks to outlaw the power of the taxation department to proactively collect tax debts. The appeal to the Constitutional Court (or Sala...

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