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When starting a business in Costa Rica, choosing a corporate structure should be the first step, especially if the business is developed by two or more stakeholders. The two most common business structures under Costa Rican Law are the Sociedad Anónima (SA) and the Sociedad de Responsabilidad Limitada (SRL or Ltda.).

Below you will find a chart comparing the relevant features and differences between these entities:

Similar to a U.S. Corporation.

Similar to a U.S. Limited Liability Company

Capital may be in any currency.

Capital must be in Costa Rican colones and stated in multiples of 100.


Ownership interest is represented by shares, which are deemed securities and are freely transferable (except for a shareholder agreement requiring the authorization of the Board of Directors or the shareholders). Shares are transferable by endorsing the share. Shares may be of different classes and certain classes may have preferences or limitations compared to others.


Ownership interest is represented by Partnership Interests (“Cuotas”). Partnership Interests (“Cuotas”) are not securities and they are not freely transferable. A statutory right of first refusal in acquiring Partnership Interests (“Cuotas”) exists for the benefit of remaining partners. The transfer of Partnership Interests (“Cuotas”) requires the approval of 100% of the partners (unless the articles of association provide for a lesser majority, but never less than 75%). The transfer must be done through a formal assignment agreement.


No statutory preference for acquiring new shares in capital increases.


Statutory preference for existing partners to subscribe to new capital in proportion to their respective stake, in the event of a capital increase. If a Partner is not present at a meeting authorizing a capital increase, he/she must be notified and allowed to exercise this right.


Board of Directors comprised of at least a President, a secretary, and a treasurer.


No Board of Directors. The company is administered by one or more managers or submanagers with the authority granted to them by the partners.


Costa Rican law requires that all companies appoint a Statutory Examiner (“Fiscal”). The main responsibility of the examiner is to determine that all corporate rules, statutory obligations and procedures are duly and adequately followed to ensure protection of the interests of shareholders. The Commercial Code establishes that those who hold another position in the company cannot be appointed as auditors. Neither can the spouses of the managers and their blood relatives and in-laws up to the second degree.


No Statutory Examiner (“Fiscal”) is required.


Definite Term.


Definite Term.


Limited liability for its shareholders. Shareholders are only liable up to the amount of their capital contribution.


Limited liability for its partners, who are only liable up to the amount of their capital contribution.

Incorporation process

  • Once the corporate structure is chosen, then the first step for incorporating a Costa Rican company is to check the availability of the proposed company name. In less than one day the proposed name can be verified. In addition to the corporate name, the Public Registry will assign you a corporate identification number (“cédula de persona jurídica” in Spanish) that can be used as a corporate name in the meanwhile.
  • Then, a Notary Public drafts and notarizes public deeds of the incorporation charter or bylaws for registration before the Public Registry online. The incorporation deed must be executed by the founding shareholders/partners of the company; at least two persons must concur as founding partners, but once the company is duly incorporated the shares can be transferred, or the Partnership Interests (“Cuotas”) can be assigned to one or more different persons than the founding partners.
  • As a prerequisite for registering the company, 25% of the capital stock indicated in the bylaws (if paid in cash) must be deposited in a national bank. The amount deposited may be withdrawn once the company has been duly recorded. If the founders chose to sign a promissory note, there is no enforceable obligation to deposit capital in a bank account later.
  • Once the incorporation process has been completed, the Public Registry will issue a corporate identification number, assigning a number that becomes evidence of the company’s readiness to start operations lawfully. With the constitution of the company, the Public Registry will assign a number for issuing the legal books of the company.

A company can be incorporated within 5 to 8 business days from the date of execution of the incorporation deed.


All legal entities and other legal vehicles must annually provide the information to the platform managed by the Central Bank of Costa Rica to comply with their declaration. Our director Bernardo van der Laat, explains everything we need to know about the Declaration for the Registry of Transparency and Final Beneficiary in Costa Rica.


Corporations must be registered as taxpayers, even if the company does not have an economic activity yet. The following are the main obligations a company must comply with before the Tax Administration:

Every company must be formally registered as a taxpayer using a D-140 form, where it will specify its economic activity (if any), operational address, legal representative information, and contact information. If the company does not conduct economic activity, then it must be registered under the description of “Legal person incorporated in the country that does not carry out economic activity of a Costa Rican source.”

All corporate entities that are duly registered in the Public Registry must pay corporate taxes. This applies whether or not the company actively engages in a commercial activity.

For companies that are registered as active taxpayers, the payable amount will be determined based on the gross income reported during the prior fiscal year.

If the company is not engaged in commercial activity and is not registered as a taxpayer, it should annually pay fifteen percent (15%) of one monthly base salary.

Those who fail to pay on time, are liable to economic and operational penalties.

The Costa Rican tax system is based on the principle of territoriality. Therefore, only Costa Rican source income derived from real estate, movable assets, goods, operations, and services rendered or located in Costa Rica is subject to taxation. This is regardless of citizenship, residence, or domicile.

Under territorial taxation, the Costa Rican income tax regime encumbers continuous or temporary income received or earned by individuals or entities with legal domicile in Costa Rica. The profits, income, or benefits of a Costa Rican source shall include the services, assets, or capital used in the national territory, obtained during the fiscal year. Any income produced outside Costa Rica is not subject to taxation.

Income tax filings are completed electronically through a digital platform (“ATV” in Spanish).

Legal entities incorporated 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 assets, liabilities, and social capital.

This form should be filed within two months and fifteen calendar days following the end of the fiscal year.

All distributions made by a Costa Rican company from its net profit, are subject to a fifteen (15%) withholding tax. However, dividends received by a Costa Rican entity registered as a taxpayer, from another Costa Rican entity are exempted. However, it is advisable to get the assessment of a tax advisor to confirm exactly what kind of fiscal implications will apply for the Costa Rican entity.

Dividend-related tax filings are completed electronically through the ATV digital platform.

With the recent approval of the Tax Reform, the existing Sales Tax evolved into a Value Added Tax (“VAT”) as of July 2019.

The VAT taxes most sales of goods and services at a 13% rate (exceptions are found in the law, such as private education and medical services). Therefore, taxpayers that offer taxable services are obliged to add the 13% applicable VAT rate and report the amounts collected with a monthly report.

Sales tax filings are completed electronically through the ATV digital platform.

All Costa Rican taxpayers are obligated to employ electronic invoices.

Electronic invoices replace paper invoices, to allow the Tax Administration a more efficient way to control tax evasion; while providing real information of sales amount to properly calculate income taxes.

Companies must select an electronic invoice provider that is properly registered before the Tax Administration.

All legal entities with a Costa Rican legal identification number, including, corporations, limited liability companies, branches, foreign entities with powers registered in Costa Rica etc., must file an annual declaration on the platform managed by the Central Bank of Costa Rica, in order to report all the information necessary to determine and identify who their ultimate beneficiaries are, with the aim of complying with the obligations established in the “Law to Improve the Fight against Tax Fraud”.

This declaration can be made by persons who: (i) hold a position of representation with general power of attorney without limit of amount in the Entity; (ii) have a Costa Rican identity or residence card – DIMEX; and, (iii) must necessarily have a “Digital Signature” (be it the special device authorized by the Central Bank). Otherwise, a Special Power of Attorney may be granted to a trusted person to make the declaration on behalf of and in representation of the Entity. It is important to remember that this declaration has the same legal validity as an affidavit, therefore, it is subject to the same sanctions and penalties in case of providing incorrect or inaccurate information.

All the information declared on the Platform must be supported by documentation that supports it. This documentation must be kept in original by the obliged subjects in case it is required by the competent authority. Any document issued abroad must be duly consularized or apostilled and with no more than sixty (60) days of issuance.

It is important to take into account that in case the Entity does not file the declaration within the established deadline, it is exposed to both administrative and pecuniary sanctions. It will not be able to register any document before the National Registry, nor will it be able to obtain legal entity certifications.



Registering your company name will not automatically grant you the right to use it as a trademark. To register a trademark in Costa Rica, you need to complete the following process:

First, it is highly recommended to run an availability search at the Costa Rican Industrial Property Register’s database to confirm a trademark’s availability.

Once the availability is confirmed, the applicant must file a petition for the registration of a trademark at the Costa Rican Industrial Property Register. The application must be notarized.

Once the application is completed and filed, it will be reviewed by an official from the Costa Rican Industrial Property Register. If there are no objections or observations, the Property Register will issue a legal notice to be published in the official government newspaper “La Gaceta”.

From the date of publication, there will be a 2-month term for any third party to file oppositions against the Costa Rican trademark application. If there are no oppositions filed within such 2-month period, then the trademark will be registered.

Based on the process described above, if there are no oppositions filed against the trademark application the registration procedure normally takes from 3 to 4 months.

The trademark registration is valid for 10 years, subject to renewal.


As a general overview, please consider that labor laws and policies in Costa Rica are very protective of employees. Labor regulations are categorized as essential public welfare, and all employment agreements should include all guaranties and rights granted under Costa Rican labor ordinances.

Any clause or provision that may be deemed as a waiver of employees’ statutory rights will be considered null and void under the local legislation.

However, not all parties that assist your company will be classified as employees. Based on the nature of your contract agreements, those relations could also be classified as professional services agreements that are not subject to labor regulations.

As a rule, labor relations are characterized by: (a) a service provided personally; (b) salary, and (c) work schedule and other forms of subordination conditions.

If you hire employees under such conditions and are hence deemed an employer under Costa Rican regulations, you must consider the following:

Standard process to transfer or purchase titled property

In order to subdivide and purchase titled property in Costa Rica, the following steps should be followed:

Before purchasing property, it is highly recommended to perform title research to acquire all information regarding the current and legal status of the property. Due diligence should also consider the review of zoning regulations, environmental restrictions, utility availability, and general regulatory compliance.

Depending on the type of property and its location, the due diligence items may vary. It is common to enter into an Option to Purchase Agreement before executing a transfer deed to provide the buyer time to review the property to its satisfaction.

A common practice in Costa Rica is to acquire property through a new company. This instrument is especially useful if the buyer wishes to sell the property in the future using a share transfer, or if the property would be managed from outside Costa Rica.

If the property to be purchased is already owned by a company, it may be acquired by share purchase, provided that proper due diligence is conducted on the company.

Once the buyer has a clear view and understanding of the property status, the parties may execute a property transfer public deed. The transfer deed shall contain all of the stipulations regarding the transfer of real estate, including basic information on the property, the buyer, seller, the purchase price, and any other terms and conditions of the sale.

The transfer deed must be executed before a Costa Rica public notary and recorded before the Real Estate Department at the Public Registry. If the buyer elects to purchase the property through a share acquisition, the agreement may be executed in a private document.

Once Counsel executes and prepares the public deed, it will be filed immediately before the Public Registry

As soon as the public deed is filed before the Public Registry for its annotation, the property will be protected against any third-party interest. Although the presentation of the public deed guarantees its priority, it does not automatically guarantee registration. The Public Registry must first approve the purchase agreement and verify that all legal requirements have been fulfilled and that the corresponding taxes and expenses have been duly paid.

Property transfer registration takes from five (5) to (10) working days.


All companies and individuals that want to open a bank account in a Costa Rican public or private bank must comply with certain requirements. The banks, at their sole discretion, can request documents and information that will serve as support to authorize the opening of bank accounts for their users.

However, it is common to request the following from the interested parties, which must be submitted for the bank to authorize the opening of the account:

  • For Costa Rican individuals, the original identification document, which must be valid and in good condition. This applies to the owner of the bank account and all the persons that will be included as authorized account signatories.
  • Original migratory identification document for foreigners known as the “DIMEX.”
  • Original identification document for diplomats (“DIDI”).
  • For non-resident foreigners, a valid passport that must have the entry stamp of the border´s authorities and, if applicable, the visa stamp. Passport must be valid.
  • For companies, an updated certificate of incumbency, a copy of the bylaws, notary certification attesting to the company´s ultimate beneficial owners, and in some cases, a certification from a licensed accountant regarding the company’s projected cash flow, must also be provided.
  • The “Know Your Customer” form.
  • Supporting documentation attesting to the source of funds of the account´s beneficiary.

At PredictaBill we constantly support our clients in their bank account opening process. In addition, we have communication with certain banking executives who will help make your account opening process faster and more efficient.

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