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Owning Property Under Your Name or Corporation

What should I do when purchasing property in Costa Rica?


In Costa Rica, anyone is permitted to own property, buy a car, or open a bank account under their given name. Neither the Commercial Code nor the Constitution prevents foreigners from creating, owning, or managing corporations. Similarly, neither the Constitution nor the Civil Code prevents foreigners from owning property, whether real estate, a vehicle, or any other type of asset. Therefore the only reason to open a Corporation within Costa Rica would be because you are starting a business or wish to bank without limitations.


The purpose of a corporation is to:

  • To amass capital from different investors or partners for the furtherance of common business goals, and

  • To separate the personal assets of the investors or partners from the business assets.

Therefore, if you are buying a property with the intent of starting a business, doing so under a corporation makes sense. As an individual, buying adequate insurance will protect you. There is no need to separate yourself from your assets.



There are a few exceptions in which a foreigner can’t own property:

  • agricultural property that was donated to farmers by the former IDA (now INDER) cannot be sold until after the farmer has owned the property for 15 years.

  • A non-citizen can own only up to 49% of the concession, and concessions are often owned through a trust.

  • There is very little untitled land left in Costa Rica, but it is possible you will find some land that is in the “possession” of the people who live on it (this is different from territory invaded by squatters) who can request title after 10 years.

  • Any property that is located within 50 meters of the high tide line is public and protected. The 150 meters that are adjacent to this zone are called the Maritime Zone (ZMT).

  • A foreigner cannot own 100% of a property in a Maritime Zone.


Generally, when looking for a home or rental property, owning the property under your name is sufficient and you’ll have fewer taxes to pay. If the property is your primary residence you will not pay capital gain taxes when it comes time to sell.


You can open a bank account as a foreigner in Costa Rica however, that account will have some limitations until you have residency. For example, you will not be able to perform or receive online or Sinpe transfers between banks. However, you will be able to pay bills and make transfers to other individuals within the same bank. This small hurtle may cause some friction if you prefer to pay rent online and your landlord has a different banking institution. A simple solution would be to open an account within the same bank with whom you have frequent transactions. The corporation will not have these limitations.


Until you have a cedula card, you may also have some restrictions in opening monthly phone plans and may have to remain with pay-as-you-go service. If these limitations are too much of a nuisance, you could open a Corporation. Having a Cedula Juridca number will allow you to use these services as a resident but be prepared to pay a few extra taxes.


In Costa Rica even if a company does not carry out commercial activities, it must pay annually the Corporate Tax starting at ¢67,530 colones. An additional fee for the Annual Registry of Transparency and Final Beneficiaries that started in 2019 is required, and the duty to register and declare the assets of inactive corporations using Form D-135.


If you do choose to own property under a corporation it would be best to register an SRL. This does not require the appointment or inclusion of any other parties other than you and your spouse. If it is only you, then you can use the EIRL. SA requires a minimum of three people which could lead to problems in the future.


The Commercial Code in Costa Rica allows for five business structures:

(Excerpt from Outlier Legal Services)


  1. Sociedad en Nombre Colectivo. Section 17 a) This is the equivalent of a General Partnership, where partners retain full, shared liability among them. Partners are not only liable for their own actions, but also for the business debts and decisions made by other partners. In addition, the personal assets of all partners can be used to satisfy the partnership’s debt.

  2. Sociedad en Comandita. Section 17 b) This is the equivalent of a Limited Liability Partnership formed by two types of partners: one or more general partners who direct business and’ are jointly and severally liable for debts, and one or more limited partners whose liability is limited to the amount of equity paid in.

  3. Sociedad de Responsabilidad Limitada or SRL. Section 17 c) This is the equivalent of an LLC and is the appropriate structure for companies with a small number of investors. It is a hybrid type of legal structure that provides the limited liability features of a corporation and operational flexibility of a partnership. The “owners” of an SRL are referred to as “cuotistas.” While in the USA some states allow the company to be formed by one single individual, in Costa Rica the SRL must be formed by at least two members. Contrary to the SAs, SRLs do not have a board of directors and are administered by one or more managers.

  4. Sociedad Anónima or SA. Section 17 d) This is the equivalent of a corporation. A corporation is an independent legal entity owned by shareholders. This means that the corporation itself, not the shareholders that own it, is held legally liable for the actions and debts the business incurs. Corporations are more complex than other business structures. They are required to have a board of directors which is elected by the shareholders. The shareholders need to meet in a general assembly at least once a year. SAs tend to have costly administrative fees and legal requirements. SAs are generally suggested for established, larger companies with multiple shareholders.

  5. Empresa Individual de Responsabilidad Limitada. Chapter II. The name stands for Individual Limited Liability Company, and as it implies, it is for an individual person. Thus, the company is registered with only one owner. This type of structure is suggested for people doing business on their own with no partners.


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