Starting on August 1, 2020, cross-border digital services will be subject to a 13% VAT in Costa Rica. This tax will be calculated on the gross amount of any purchase of international services or intangible goods made through the internet or other digital platform and consumed in the national territory.
The Tax Authorities by resolution No. DGT-R-13-2020 established that the VAT may be withheld directly by the service provider or intermediary, or by the credit or debit card issuer involved in the transaction.
In those cases where the tax is withheld directly by the provider or intermediary, the provider must register as a VAT withholding agent, following the procedure determined by the resolution, and may request voluntary deregistration at any time.
Among the obligations of the provider or intermediary subject to in the resolution is the responsibility to pay to the Tax Authorities within the first 15 calendar days of the month following the month in which the sale of the digital services or intangible goods occurred the tax withheld for the services rendered and/or intangible goods consumed in the national territory.
Credit or debit card issuers must apply the withholding tax on the transactions made by a cardholder through the digital services providers included in the list of cross-border digital services providers, which is available on the website of the Ministry of Treasury. The VAT withheld must be declared within three working days after the cardholder is charged.
Finally, the resolution established that a consumer of digital services and/or intangible goods who is a VAT taxpayer may use the invoice issued by a provider or intermediary domiciled abroad, or the bank statement of the card or an equivalent document received, to support the purchase and apply for the respective tax credit.
