If you’re dreaming of sunsets over the Pacific, tropical wildlife in your backyard, and a laid-back pura vida lifestyle, you’re not alone. Buying a home in Costa Rica has become incredibly popular among expats and investors seeking natural beauty and a strong sense of community. But before you dive into Costa Rica real estate for sale, it’s smart to understand the taxes involved. Let’s break it down with some helpful—and fun—clarity.
Do Foreigners Pay Taxes in Costa Rica?
Yes, they do—but don’t worry, the process is pretty straightforward. Costa Rica warmly welcomes foreign buyers, and you have the same rights as locals when it comes to owning property. Whether you’re a retiree buying a cozy beach bungalow or an investor eyeing Costa Rica real estate, you will be subject to a few key taxes, just like Ticos.
Does Costa Rica Pay Property Taxes?
Absolutely, and here’s the good news: property taxes in Costa Rica are incredibly low. The annual property tax is just 0.25% of the registered value of the property. For example, if your tropical dream home is valued at $200,000, you’ll owe just $500 per year in property taxes. That’s a steal compared to many North American and European countries.
In addition to the annual tax, there’s also a municipal services tax, usually another 0.25%. So altogether, you’re looking at about 0.5% per year in total property-related taxes. Not too shabby for paradise!
What is the Luxury Home Tax in Costa Rica?
Now, if you’re going big—say, a luxury ocean-view estate in Dominical or Ojochal—then you might be subject to the “Impuesto Solidario,” or luxury home tax. This applies to homes valued above a certain threshold (roughly $230,000 USD, though this adjusts yearly).
This luxury tax is on a sliding scale, starting at around 0.25% and going up to 0.55%, depending on the property’s assessed value. It’s assessed on the construction value, not the land. So if you’re looking at Costa Rica real estate for sale in the luxury bracket, it’s worth factoring this in.
Do You Pay Capital Gains in Costa Rica?
Yes—capital gains tax was introduced in Costa Rica in 2019. If you’re selling a property that’s not your primary residence, you’ll pay a 15% tax on net capital gains.
However, if the property is your primary home (and you’re a legal resident), you’re likely exempt. This is great news for those relocating long-term and working with a trustworthy Costa Rica real estate service (like Ballena Properties!) to settle in.
Do You Pay Taxes on Homes in Costa Rica?
If you own a home, yes. Between the standard property tax, municipal services tax, and possibly the luxury home tax, there are a few recurring obligations—but they’re manageable and far lower than in most other tropical destinations.
There’s also a real estate transfer tax of 1.5%, typically paid when purchasing a property. This is based on the higher of either the registered value or the actual sales price. Your real estate lawyer or Costa Rica real estate service provider will usually handle this as part of the closing costs.
Are There Tax Benefits to Living in Costa Rica?
You bet! One major plus is that Costa Rica taxes you only on local income. So if you’re a digital nomad or retiree with income from abroad, that money generally isn’t taxed in Costa Rica.
Plus, the low property taxes and potential capital gains exemptions for residents make buying a home in Costa Rica not just a lifestyle dream—but also a smart financial decision.
Top Spots: Dominical, Uvita, and Ojochal
Thinking about where to plant roots? Be sure to check out some of the most beautiful areas along the southern Pacific coast:
- Dominical real estate for sale: Known for its epic surf, boho beach town vibe, and lush rainforest backdrops.
- Uvita real estate: Home to the famous Whale’s Tail beach and Marino Ballena National Park—an ideal mix of nature and convenience.
- Ojochal real estate: A charming village with a renowned culinary scene and serene mountain-to-sea views.
No matter your vibe—surf, sanctuary, or something in between—Ballena Properties has premium listings to match your dream.
Final Thoughts
Buying a home in Costa Rica comes with some taxes, yes—but they’re refreshingly reasonable, especially when compared to global standards. Whether you’re browsing Costa Rica real estate for sale or already picking out hammocks for your new porch, knowing the tax landscape helps you plan wisely.
And remember: working with a reputable, bilingual Costa Rica real estate service like Ballena Properties ensures you stay informed, compliant, and confident from offer to ownership.
Ready to explore the best of Costa Rica real estate? Browse listings or contact Ballena Properties for expert, premium service backed by years of local experience. The pura vida life—and some very fair taxes—are waiting for you. Read up on the pitfalls of buying property in Costa Rica for foreigners before you invest.
Recommended Reads
For more insights before you buy, explore these useful guides:
- Buying a home in Costa Rica: A complete guide for expats
- Buying a Costa Rica Beach House: What You Should Know
- 5 Mistakes Foreign Buyers Make When Buying Costa Rica Real Estate
- How to Generate Rental Income from Your Costa Rica Vacation Home
- Beachfront or Jungle Home in Costa Rica: Which is the Best Investment?
- 5 Reasons to Invest in Real Estate in Costa Rica’s Southern Zone
- Costa Rica vs California Real Estate
