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IMPORTANT ASPECTS OF THE CORPORATE TAXES LAW N°9428 (Costa Rica)

May 13, 2018 10:38 am

Field of application

To all corporations, to the representatives or branches of foreign corporations and to LTDA/SRL companies; it applies to both the corporations that are already registered as well for the ones that are going to be registered in the Mercantile National Registry.

Payment

Each tax period will be counted from January 1° to December 31° of the same year.

For the entities that are already registered, the tax will generate on January 1° of each year and the payment has to be done during the next 30 days counted from January 1° of each year.

As for the entities that are set up during the year, the taxes have to be paid in the next 30 days counted from the day of submission of the public deed of Constitution of the Corporation before the National Registry.

The rate has to be proportional to the time left between the date of submission of the deed and the end of the tax period. The discount stated in the Law of Taxation of the National Registry will not apply.

The tax is paid through the means, forms and conditions established for this purpose by the National Tax Office.

Rates

The law lists four scenarios under which the rate that must be paid is established:

  • The corporations that are registered in the Registry of Corporations, but not in the Unique Tax Registry of the General Directorate of Taxation, must pay an amount equivalent to 15% of a monthly base salary (office worker 1) according to the second article of the Law N°7337.
  • Taxpayers of the utility tax who have declared a gross income lower than one hundred and twenty base salaries regarding the utility tax of the last period, must pay an amount equivalent to 25% of a monthly base salary.
  • Taxpayers of the utility tax who have declared a gross income between a hundred and twenty and two hundred and eighty base salaries regarding the utility tax of the las period, must pay an amount equivalent to 30% of a monthly base salary.
  • Taxpayers of the utility tax who have declared a gross income equal or superior than two hundred and eighty base salaries regarding the utility tax of the last period, must pay an amount equivalent to 50% of a monthly base salary.
  • The legal representatives of the corporations are jointly responsible for the neglect of payment of the taxes stablished in the Law.

    Sanctions

    In case of non-compliance, the Code of Rules and Procedures of Taxes.

    The National Registry will not be able to issue certifications, nor register any document in favor of taxpayers who are not up to date with the payments of this tax. Notary Public that issue certifications to the overdue taxpayers must record this condition in the respective document.

    The overdue taxpayers cannot contract with the Government or any public institution.

    The debts derived from this tax will constitute preferential legal mortgage or preferential liens on the corporation assets.

    The neglect of payment for 3 consecutive periods is cause of dissolution. The National Tax Office will send to the National Registry a report of the taxpayers that did not payed the taxes, so that the National Registry can proceed with the cancellation of registry and asset annotation.