This guide provides an overview of VAT in Costa Rica, including applicable rates, registration requirements, compliance obligations, and filing deadlines. It is designed for businesses engaging in transactions within Costa Rica.
is when Costa Rica transitioned from a sales tax to a comprehensive VAT system.
Doing business in Costa Rica? You’ll need to play by the Value Added Tax Act rules.
Any business carrying out taxable activities in Costa Rica is required to register.
Costa Rica requires foreign digital service providers to register for VAT if they supply digital services to consumers in Costa Rica.
Only businesses registered for IVA with the Ministry of Finance (Ministerio de Hacienda) may reclaim VAT. The expenses must directly relate to taxable business activities.
VAT reclaim is done through the monthly IVA return (Formulario D-104). Input VAT on purchases is deducted from output VAT on sales. If credits exceed liabilities, the remaining credit is carried forward. Refunds are possible in specific cases (e.g., exporters).
VAT returns are filed monthly, using the D-104 form. Payments are due by the 15th of the month following the taxable period.
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