Costa Rica Properties, protect your Investments

It is not always easy for foreigners investing or living in Costa Rica to find the right information to protect their investments.

There are a handful of simple rules you should follow, which might save you trouble and money later.

Many come to Costa Rica to buy property and the first thing you should do is make a title search on the lot you are considering. This means that you have to go to the Public Register in order to get a certificate in which all the main details of the property will appear. Use a good lawyer to help you with the research and the to advise on the transaction process.

After you are sure about purchasing the property, you will have to appear before a Notary Public or attorney to get the property transferred and registered in your name. This is necessary, and if a seller ignores this process there is something wrong.

When you have signed the transfer document, you will need to pay the transfer taxes. Usually the notary will ask you for a specific amount of money, which should include the notary’s fees and those taxes. It is the notary who will be in charge of paying all the necessary taxes and tax stamps, so always ask for a detailed receipt of what you are paying for. If these taxes are not paid, the property will not be registered in your name and you can be defrauded. Another thing to keep in mind is that transferring a property is relatively simple. No unreasonable delays should take place, and if they do, something could be wrong.

Another issue that could put your property at risk is land taxes. If you come from a country such as

Canada, Holland, Germany, the United States or any other countries which boast advanced tax collection systems, you may be surprised at that which you find in Costa Rica. A landowner here must pay land taxes every quarter, but the difference between our system and the one that you are used to, is that here you do not receive a notice from the collecting authority when taxes are due.

The system assumes you will remember every quarter to appear before the local government or Municipality and pay such taxes. If not, you could face foreclosure procedures and lose your investment.

In order to duly pay the taxes, you will have to make sure the property is correctly registered and appraised by the local municipality.

Keep in mind it is possible to become the victim of fraud or natural disaster and you can guard against both. Natural disasters are constant risk. Property insurance is a good idea, especially if you are investing in Costa Rica but not planning to be a permanent resident. Property insurance, known in Costa Rica as title insurance, can protect your investment not only from possible fraud, but also from natural disasters. For that reason it is important to have an insurance agent analyze your case.

Another good idea is to constantly “keep an eye” on your title’s status. This can be easily done by accessing the Public Register’s web site, or you can have your attorney do that for you.

Costa Rican tax authorities require all taxpayers to file income statements every year, and that includes local corporations. It is possible your corporation will be excused from paying taxes because of a so-called “lack of commercial activity.” For example, a corporation may not have to file a tax state or pay any taxes if it has been created simply to maintain your property title.

Even if you own one of these corporations --- which by law are not required to pay income taxes --- it is important that you are aware of the Educación y Cultura tax stamp. This tax has to be paid every year in March and the amount will not exceed 9000 colones (about $18). While this may appear a small sum, it must be paid in order to comply with the law.
Of course, there is a lot of other paperwork which must be filled out and considered, but those above are among those most commonly neglected. Deal with them and you can save a lot of time, money and trouble later.

Comments

[registry collection real estate]

A great idea to protect investments, a very informative blog, thanks for sharing.

-Linda

[investment commercial property]

Costa Rica is a very good example of a good investment but at the same time; in order to survive this market as well as any other, follows some simple tips. On average the property market in Costa Rica has increased a 300% in the previous 10 years. This has resulted in investors being able to even tripling from doubling their money in just a short span of time.

[Philippines properties for sale]

Great post! thanks for sharing this very informative post. With this tips I think I can protect my properties.

-pia-

[Land in Texas]

Their numerous other countries. There are distinct restricts of taxation counting on your income: the more you profit from, the more you pay; if you profit from less than the smallest allowance established by Costa Rican regulation, you yield no taxes. The next rudimentary data talks about some of the levy scheme, but you should habitually ascertain present numbers with your accountant.
Municipal Taxes.

[miami beach apartments]

As i was looking for more information regarding the property and their related issues, this blog have been helped me a lot.

[homes in Bellingham]

Costa Rica is an excellent example of a lovely investment but at the same time; in order to survive this market as well as any other, follows some simple tips. On average the property market in Costa Rica has increased a 300% in the earlier ten years. This has resulted in investors being able to even tripling from doubling their funds in a short span of time.

[Calvin Mordarski]

Foreigners who are willing to retire in Costa Rica must follow its rules on taxes and insurance. This rule of thumb must be practiced not only in Costa Rica, but in every other place.