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You will need to be familiar with the financial regulations in Costa Rica if you plan to do business or launch a company in that market.
Because failure to comply with financial regulations can cause legal issues or result in financial penalties, potentially diminishing the standing of your company in the eyes of local authorities and impacting your business.
Financial regulatory compliance can also refer to corporate compliance. Many of its features are offered under the umbrella of corporate secretarial service providers.
If you are thinking about starting a business in Costa RicaThis guide will be of great help.
If you are interested in market entry or have questions about ongoing operations in Costa Rica please contact us. contact us todayLet’s talk about how we can support your business.
Costa Rica is popular with foreigners who are looking to invest or relocate.
Costa Rica is one of the most stable, developed and prosperous countries in Latin America. It also boasts the highest levels English proficiency.
Those factors contribute to Costa Rica’s popularity among foreign investors looking to do business in Latin America, with over $2.5 billion in foreign direct investment (FDI) inflows entering the country in 2019.
It is also a popular holiday destination and attracts many retirees and remote workers from the United States, Canada and Europe.
Prior to the COVID-19 epidemic, foreign investment made up 7.8% of gross domestic products. However, that number has fallen to 3.5% in the wake of the global health crisis. Therefore, the Costa Rican government is encouraging foreigners to return to Costa Rica.
This includes the recent announcement of incentives and reduced investment prerequisitesTo obtain residency, as well a new scheme to entice digital nomads and remote workersTo move to the country.
Financial regulatory compliance in Costa Rica: key responsibilities & dates
While there are some aspects of Financial regulatory complianceIn Costa RicaVariations can be made based on the type of company you haveThese aspects of corporate compliance are applicable to all.
Annual shareholders meeting is an essential aspect of compliance for any company registered before Costa Rica’s National Registry of CorporationsAll shareholders must be notified in advance. This must be done within 3 months of the close of the fiscal year. The fiscal year runs from January 1 through December 31. Therefore, the shareholders meeting must take place by March 31.
Payment of annual corporation taxes must be made to Costa Rica’s General Directorate of Taxation (DGT) every year. Payments are due by January 31.
Filing annual income tax returnsYou must complete Form D101 and submit it to the DGT by March 15, after the end of each fiscal year.
Filing an annual statement summary of suppliers clients and specific expensesAnother annual obligation is via Form D-151. This form must be completed by February 28, the year following the fiscal year. This form includes information about the company’s large clients and suppliers. It also includes amounts that were sold or purchased in the previous fiscal year.
Ultimate Beneficial Owner Declaration (UBO) Must be filed by April 30th each year. The UBO declares who is the owner or beneficiary of a legal entity involved in transactions and is an important element of financial regulatory compliance in Costa Rica.
Payment of the annual ‘Education and Culture Stamp’ All payments must be made by March 31 to the DGT. The funds generated from this payment go towards higher and further education, particularly among lower-income learners, as well as supporting Costa Rica’s National Museum.
An annual report on operationsYou must file a request to the Costa Rican Trade Promotion Agency.PROCOMER) by any company operating in a free trade zone (FTZ), no later than April 31, four calendar months after the end of the fiscal year.
Additional considerations for financial regulatory compliance in Costa Rica
Every company that is registered in Costa Rica must have an address in Costa Rica, so that official correspondence can be received.
All companies should also have a legal representative in Costa RicaThe representative of the company before authority, but does no need to have any credentials.
However, if the appointed representative is not a Costa Rican citizen/resident, a resident agents must be appointed. They must be a qualified Costa Rican attorney. All official correspondences will be sent to the resident agent.
Biz Latin Hub is here to help you with Costa Rican financial regulatory compliance
Biz Latin Hub has multilingual corporate support specialists who can help you with Costa Rican financial regulations compliance. With our extensive portfolio of back-office solutions, including accounting & taxation, company formation, legal services, hiring & PEO, and visa processing, we can be your single point of contact for entering and doing business in Costa Rica, or any of the other 17 markets around Latin America and the Caribbean where we have teams in place.
Contact us nowLet’s talk about how we can help your business.
You can also read about our team and expert authors.
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