For years, the Costa Rican real estate market was simple: the seller paid their taxes, and the buyer acquired the title. But with the introduction of the Capital Gains Tax (CGT)<\/strong> and recent tax resolutions, particularly Article 28 ter of the Income Tax Law (Law 7092)<\/strong>, a major change has occurred for properties sold by non-resident sellers<\/strong>.<\/p>\n\n\n\n Now, the buyer is legally responsible<\/strong> for acting as the Withholding Agent<\/em>. While this may sound complex, it is a mechanism designed to increase compliance, prevent tax evasion, and most importantly protect your property transaction<\/strong> from future complications.<\/p>\n\n\n\n This law applies only when the seller is considered a non-resident of Costa Rica. Important:<\/strong> If a property is held by an active Costa Rican corporation (sociedad an\u00f3nima<\/em> or SRL<\/em>) registered with the tax authorities, it is typically considered domiciled and not subject to this withholding rule. Always confirm the seller\u2019s tax status with your attorney.<\/p>\n\n\n\n If you are buying property from a non-resident seller, you, the buyer, must withhold 2.5% of the total sale price<\/strong> and remit it to the Costa Rican Tax Authority (Direcci\u00f3n General de Tributaci\u00f3n<\/strong>, or \u201cHacienda\u201d).<\/p>\n\n\n\n This 2.5% is not the seller\u2019s total tax liability. It is an advance payment (credit)<\/strong> toward their final capital gains tax calculation.<\/p>\n\n\n\n When your closing is managed by a qualified notary public<\/strong> y escrow agent<\/strong>, here is how compliance works:<\/p>\n\n\n\n Your legal team verifies whether the seller is an official resident or non-resident. This determines if the 2.5% withholding applies.<\/p>\n\n\n\n The full purchase amount is deposited into escrow. Under the notary\u2019s guidance, 2.5% is deducted<\/strong> from the funds due to the seller and held aside for tax remittance.<\/p>\n\n\n\n The buyer (or their attorney) must:<\/p>\n\n\n\n Once fully implemented, the National Registry will not register<\/strong> a transfer until Hacienda confirms that the withholding has been declared and paid. Although this enforcement is still being phased in at the time of this post, buyers should assume it will soon be mandatory. Proper compliance is essential to avoid delays in title registration.<\/p>\n\n\n\n The seller receives an official receipt showing the 2.5% tax withheld and can use it as a credit toward their final capital gains tax return.<\/p>\n\n\n\n For sellers who purchased their property before July 1, 2019<\/strong>, the law allows a one-time alternative<\/strong>: pay a flat 2.25% of the total sale price<\/strong> instead of 15% on net gains. If you are purchasing real estate in Costa Rica, including our zone of specialty of Jac\u00f3, Herradura, Playa Blanca, and Punta Leona<\/strong>, the 2.5% withholding rule is a small technical detail with major consequences<\/strong> if ignored.<\/p>\n\n\n\n Failure to comply can lead to:<\/p>\n\n\n\n Working with an experienced real estate broker<\/strong> and a qualified legal team<\/strong> ensures your transaction remains compliant, efficient, and secure.<\/p>\n\n\n\n At\u00a0Pacific Dreams Realty<\/strong>, we specialize in guiding international buyers and sellers through every legal and financial detail of real estate transactions along Costa Rica\u2019s Central Pacific, covering\u00a0Jac\u00f3, Playa Blanca, Herradura, Los Sue\u00f1os, and Punta Leona<\/strong>.<\/p>\n\n\n\n Whether you are purchasing your dream vacation home or selling an investment property, our team ensures your closing is smooth, compliant, and 100% secure.<\/strong>sellers through this process, ensuring secure and compliant closings every time.<\/p>\n\n\n\n <\/p>","protected":false},"excerpt":{"rendered":" The Law That Made Buyers the Tax Police For years, the Costa Rican real estate market was simple: the seller paid their taxes, and the buyer acquired the title. But with the introduction of the Capital Gains Tax (CGT) and recent tax resolutions, particularly Article 28 ter of the Income Tax Law (Law 7092), a major change has […]<\/p>\n","protected":false},"author":1,"featured_media":9514,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[96,8,136],"tags":[],"class_list":["post-9513","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment","category-real-estate","category-taxes"],"_links":{"self":[{"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/posts\/9513","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/comments?post=9513"}],"version-history":[{"count":2,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/posts\/9513\/revisions"}],"predecessor-version":[{"id":9517,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/posts\/9513\/revisions\/9517"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/media\/9514"}],"wp:attachment":[{"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/media?parent=9513"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/categories?post=9513"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/pacificdreamsrealtycr.com\/es\/wp-json\/wp\/v2\/tags?post=9513"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\n\n\n\nWho Is Affected? (The Non-Resident Seller)<\/strong><\/h2>\n\n\n\n
That classification typically includes:<\/p>\n\n\n\n\n
\n\n\n\nThe Core Rule: Withhold 2.5% of the Gross Sale Price<\/strong><\/h2>\n\n\n\n
What Is Withheld?<\/strong><\/th> 2.5% of the total sale price<\/th><\/tr><\/thead> Who Withholds?<\/strong><\/td> The Buyer (as Withholding Agent)<\/td><\/tr> Who Receives the Payment?<\/strong><\/td> Direcci\u00f3n General de Tributaci\u00f3n (Hacienda)<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
\n\n\n\nBuyer Compliance: The Four-Step Closing Checklist<\/strong><\/h2>\n\n\n\n
1. Identify the Seller\u2019s Status<\/h3>\n\n\n\n
2. Fund the Escrow and Apply the Withholding<\/h3>\n\n\n\n
3. File the Declaration and Remit the Payment<\/h3>\n\n\n\n
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4. Register the Deed at the National Registry<\/h3>\n\n\n\n
\n\n\n\nWhat Happens to the Seller?<\/strong><\/h2>\n\n\n\n
\n
\n\n\n\nSpecial Option: The 2.25% Rule<\/strong><\/h2>\n\n\n\n
In these cases, the 2.5% withholding typically covers or slightly exceeds the seller\u2019s tax liability, simplifying the process.<\/p>\n\n\n\n
\n\n\n\nWhy This Matters for Buyers in the Central Pacific<\/strong><\/h2>\n\n\n\n
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\n\n\n\nWhat Buyers Should Do Before Closing<\/strong><\/h2>\n\n\n\n
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\n\n\n\nNavigating Real Estate Closings with Confidence<\/strong><\/h2>\n\n\n\n