Costa Rica – located on the Central American isthmus is the most visited nation in Central America. Home to a rich variety of animals and plants as well as a tropical climate year round are the key reasons for its popularity as a holiday destination. Nearly a quarter of the approximate 4.5 million inhabitants live in the metropolitan area of the capital city, San José. In terms of human development, Costa Rica is leading the Latin American region.
Costa Rica’s rapidly developing economy, once heavily dependent on agriculture (especially coffee), has diversified into many sectors so that its industry has become much more focussed on the world of business. Pharmaceuticals, software development, financial outsourcing, and ecotourism have become prime industries. Costa Rica has a tax on water pollution to protect the environment.
A specific tax breaks by the government in to encourage higher education makes the country attractive to investors. Several global high-tech corporations have started developing in the country.
Contracting in Latin America is not a simple task and has many on-costs for employers. Most in country tax laws do not recognise contractors per se, hence contract workers may need to be remunerated as employees, taxes withheld and paid to various city, state and federal governments, and reserve funds held for other entitlements until end of contract. Please contact CXC Global for professional advice on the specific legislation applying in the country in order to facilitate contractors and foreign nationals working in Costa Rica. Forward planning is of the essence to optimize costs. Costa Rica has entered into Double Taxation Treaties with other countries.
For foreign national contract workers, contracting in Costa Rica, it would be wise to consult with CXC Global on the best way to structure, and how best to balance your taxation.
With our extensive experience and expertise in contractor management, and assisting organisations with their contingent workforce, CXC Global has the resources and solutions to manage the administration process associated with contracting in Costa Rica, facilitating accounting services and administration, local tax calculations, social security registration, tax balancing and preparation of personal income tax return at the end of the tax year.