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Avoid Property Transfer Tax in Costa Rica

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If you sell a piece of real property (bienes inmuebles) in Costa Rica, there is a 1.5% transfer tax based on the highest value given by either the value in the transfer deed or the value assigned at the time the property was acquired. One way to avoid this tax is to put the property under a corporation as an asset. In this manner, you only need to sell the shares of the corporation, which are not taxed. There is no free lunch, however, since you must pay a few hundred dollars to create the corporation and about $200 per year in taxes on the corporation if it is used only to hold an asset.

Submitted on Mar 19, 2014 - Category: Real Estate, Network: Costa Rica

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