On Friday, December 25, Central America observes the feast of the nativity of Jesus Christ, which entails the enjoyment of a holiday regulated in the region as follows: Guatemala: The holiday is a mandatory pay date, applicable to 12 hours on December 24 and all day on December 25. An employee who works from noon…
Tag Archives: Costa Rica
By resolution DGT-R-38-2020, the General Directorate of Taxation determined that inactive entities registered before the Tax Administration under the economic activity code 960113, “legal entities constituted in the country that do not develop economic activity from a Costa Rican source”, must file an Income Tax Return using form D-101. The information to be submitted must include…
The Costa Rican Social Security Fund (“La Caja”) has recently sent a message to all employers informing of modifications to the composition percentages of the Labor Capitalization Fund (FCL)) and the Obligatory Pension Scheme (ROP), based on the Law to Safeguard the Right of Workers to Withdraw Supplementary Pension Resources, law number 9906, which has…
Are you aware of the formal tax obligation of inactive companies in Costa Rica? Below, we detail this obligation and suggest how to comply with it in time to avoid sanctions. What is this new tax compliance about? The formal obligation consists of filing declaration D.135 called, Asset Declaration for Inactive Legal Persons. Who must…
As of March 1, 2021, no person may access an early retirement with the right to a reduced pension under articles 5 and 24 of the Disability, Old-age and Death Insurance Regulations. * Since the publication of the amendment to the indicated Regulation, a gradual change in the right to early pension was established as…
Law that suspends VAT charge on construction services enters into force On September 16, 2020, Law N°9887, which suspends the Value-Added Tax on engineering, architecture, topography, and construction services for civil works until August 31, 2021, entered into force. Moreover, for the years 2021 and 2022, the law reduces the VAT charge to 4% and…
The Costa Rican government has issued a regulation exempting spare parts for electric vehicles and fast-charging centers from the Value-Added Tax (VAT), Selective Consumption Tax, and the 1% tax over customs value. The regulation also established the obligation for electric vehicle importers to inform the Energy Direction of the MINAE, during September of each year,…
Nearshoring is a company’s process of transferring part of its business from a geographically distant country to one closer to its main place of operation. In recent decades, many manufacturing and service companies have sought to establish themselves in various jurisdictions around the world to operate at a lower cost and diversify their production capabilities,…
On Saturday, August 15, 2020, Costa Rica celebrates Mother’s Day which was established as a holiday of mandatory payment according to article 148 of the Labor Code. This year, under Law No. 9875, Transfer holidays to Mondays, to promote internal visits and tourism during the years 2020 to 2024, the enjoyment of Mother’s Day from a…
Yesterday, the Legislative Assembly approved in first debate two bills of law intending to extend the VAT exoneration applicable to tourism and construction services. Regarding tourism services, the bill proposes that during the first two years of the entry into force of the Strengthening of the Public Finances Law (until June 30th, 2021), tourism services…