Last September 30th, 2011, the Costa Rican Tax Administration (Tributacion) gave us a couple of nice gifts in the last few days of our fiscal year end, it couldn’t be more convenient.

The good gifts are:

• The archaic accounting and legal books are gone and…
• The invoices (facturas) can now be delivered electronically.

How are the books going to work now? Resolution Nº DGT-R-027-2011

Well, it seems that the Tax Administration, specifically its head Francisco Villalobos, was so excited about this change and all they said is that starting now, the tax payers can decide if they want to keep their records in the same old fashion way or switch to a “digital format.”

What they have not explained what they mean by “digital format,” nor have they explained how the information should be stored however, no doubt the Tax Administration will officially establish these procedures in the near future.

So, all we know for now is that the tax payer who already has the books legalized can switch to this more modern tool and those who would get their books legalized for the first time, can up front, to decide if they want the old school books or the new era ones, now we have to wait for more detailed information about the format.

Electronic Invoices… Finally! Resolution DGT-R-026-2011

The electronic invoices had been around for a good while now in Costa Rica, which means that a business can get registered under a “special category” in order to be able to electronically issue invoices, which means that those big blocks of paper wouldn’t be needed any more, but now it gets better since now those business can also email the invoice to the customer instead of printing the invoice out and hand it to the customer, this is really good.

To rent or buy this one hour video with Costa Rica Tax Expert Randall Zamora, please visit our Video On Demand page here.

Nevertheless, the not so good part is that in order to be authorized to electronically issue the invoices, the software must be a XML based one, I am not going to get into technical areas, but this means that not any POS or accounting software can be used to get this job done which means that not everybody would be able to get registered under this special category at the Tax Administration.

If I was them, the Tax Administration, I would allow the use of any software which at least guarantees a satisfactory level of security (not possible to delete invoices without a second user’s authorization for instance) to be used and not only those based on XML, the logic behind that is simple: I would want as many tax payer as possible to join this program, not only because it makes it real easy for everybody but because a lot of businesses will save on paper!

Don’t get me wrong, these are two great and expected big steps in order to take the Tax Administration to a higher level, but as usual the Tax Administration hasn’t clarified exactly how this will be accomplished.

Written by Randall Zamora who is the President and CEO of CostaRicaABC.com, former CFO and Head of Accounting Department of multinational companies like Four Seasons Resort Costa Rica, active member of the Interamerican Accounting Association, Pro Bono Local Partner of The World Bank and contributor to their yearly publication “Doing Business Report.”

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Andrew Makarik

to@welovecostarica.com

Andrew Makarik is the main editor of WeLoveCostaRica, a fan of this sunny country. He is also a loving husband and a has a lovely daughter. By being a devoted family man and the biggest Costa Rica fan, he wants to make more people feel at home there. WeLoveCostaRica unites people and helps them find new home or a new travel destination. This website is a friendly community where everyone can find not only information, but also new friends and travel pals. Andrew is also passionate about IT and programming, so he himself maintains a friendly atmosphere in this cozy environment of WeLoveCostaRica.com.