Costa Rica imposes a Luxury Home Tax on property that is used for residential purposes and whose value for the fiscal year 2015 is greater than 128,000,000 Colones about US$241,509 at the current rate of exchange.
The tax rate starts at 0,25% and goes up to 0,55% of the valuation of the property according to the following sliding scale.
A lot of people get confused with the application of this tax because they assume that it is based on the market value of the property.
If I paid US$300,000 for my property that does not necessarily mean you are automatically subject to the Luxury Home Tax.
Why ? because the law uses the value of the construction of the structures on your property as the basis to apply the law. In order for the law to apply to your property it first has to be determined that the construction value of the building structures is above the exemption of US$241,509.
According to the Costa Rican Tax Department it has identified 3,607 properties that it has determined have the obligation to pay the Luxury Home Tax for 2015.
The Luxury Home Tax is due by January 15th, 2015 and after that date the tax due incurs a penalty fine of 1% per month and the balance accumulates interest as well.
Is Your Property In Costa Rica Subject To The Luxury Home Tax for 2015?
Written and copyright by Attorney at Law – Roger A. Petersen. Roger has been an attorney since 1992 and is a member of both the Costa Rican and Florida Bar.
He practices law in San José, Costa Rica and is the author of the best-selling book The Legal Guide To Costa Rica (the new sixth edition is now available) which you can order from Barnes & Noble here or from Amazon.com here. Attorney Petersen’s website can be found at Petersen & Philps Law Offices.
To speak with Attorney Roger Petersen about hiring him as your Costa Rica attorney, please contact them using the information below:
Escazu, San José, Costa Rica
Tel: 506-2288-2189 Ext. 101 or 2288-6228 Ext. 101
You can email Attorney Roger Petersen by clicking here.
You can visit the Petersen and Philps Law Offices Website here.
You can visit the CostaRicaLaw website here.
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