Set up a company in Costa Rica.
Central America’s institutional anchor and the standout nearshoring hub for the US market. OECD member since 2021. CIT 30% standard, IVA 13%. Free Trade Zone Regime (Law 7210/1990) — one of Latin America’s most successful, with 760+ companies and anchors including Intel, HP, Baxter, Procter & Gamble, Amazon, Microsoft. Strong English proficiency, no army (abolished 1948), stable democracy.
The two standard structures are the Sociedad Anónima (S.A.) and the Sociedad de Responsabilidad Limitada (S.R.L.). There is no major fiscal difference between them — the choice usually comes down to governance preference and the treatment of shareholder loans. Both require a minimum of two members at incorporation (though shares can be consolidated afterwards), a registered office in Costa Rica, and the appointment of a resident or fiscal representative.
You execute the bylaws (escritura constitutiva) before a Costa Rican notary, register with the Registro Nacional, obtain the corporate identity number, register with Hacienda (Ministerio de Hacienda) for tax purposes, file the UBO Declaration (RTBF), register for IVA where applicable, and complete municipal and social security registrations. Standard formation runs 3 to 6 weeks. For Free Trade Zone entities, add 8 to 16 weeks for PROCOMER qualification and zone-operator coordination.
Grant & Graham coordinates Costa Rican formations through our São Paulo office (our LatAm regional hub, opened 2026) working with senior San José counsel — structure selection, notarial incorporation, Registro Nacional filing, Hacienda registration, UBO/RTBF compliance, Banco de Costa Rica or BAC banking, sector and municipal licensing, FTZ qualification where relevant, and ongoing tax and statutory work.
30% CIT standard. Free Trade Zone exemption up to 8 years. Pillar 2 now subjects FTZ users to 15% minimum effective tax.
Costa Rican corporate taxation operates a territorial system — only Costa Rica-source income is taxed. The standard corporate income tax (CIT) rate is 30% for larger companies, with a progressive scale of 5% to 30% applying to SMEs based on gross income brackets. IVA (VAT) at 13%. The flagship Free Trade Zone Regime under Law 7210 of 1990 grants qualifying entities up to 8 years of 100% CIT exemption (extension possible), plus VAT, tariff, real estate transfer tax and WHT exemptions. The 2023 reform under Law 10381 (a direct response to EU scrutiny) introduced "qualified entities" and "adequate economic substance" requirements for MNE group passive income. Pillar 2 GMT now subjects in-scope FTZ users to a 15% minimum effective tax rate — a material consideration for larger multinationals.
Other notable items: Personal income tax progressive 0–25%. WHT 8.5%–30% depending on type of payment to non-residents. Annual Legal Entity Tax (impuesto a las personas jurídicas) on existence, varies by economically active status. UBO Declaration (RTBF) mandatory annual filing each April since 2019. Law 10381 (2023) introduces qualified entity / substance requirements for MNE passive foreign income. Cinematography Law (2025) film/audiovisual production incentives. Municipal tax applies (varies by canton). No separate capital gains tax — treated as ordinary income. Aguinaldo mandatory 13th-month payment. Social security contributions gradually rising to 12.16% by 2029.
Nine reasons businesses choose Costa Rica.
Central America’s institutional outlier — OECD member, longest-running stable democracy in Latin America, no army since 1948, strong English proficiency, world-class Free Trade Zone regime, and the obvious nearshoring base for export-oriented manufacturing or services serving the US market. The trade-offs: smaller domestic market (5.2m) and a 30% headline CIT, both materially mitigated for FTZ-qualifying operations.
OECD member since 2021
Fourth Latin American country to accede to the OECD (after Mexico, Chile, Colombia). Accession process drove material upgrades to transfer pricing, corporate governance, anti-bribery, banking supervision, environmental standards, and tax transparency frameworks. The most institutionally credible jurisdiction in Central America by a clear margin.
Free Trade Zone Regime (Law 7210)
One of the most successful FTZ regimes in Latin America. 760+ companies across 20+ industrial parks. Up to 8 years 100% CIT exemption (extensions possible), VAT and tariff exemptions, real estate transfer tax exemption, WHT on payments abroad exemption, discretionary FX use. Service companies have full access since Law 9689/2019 with no sales restrictions.
The nearshoring base for the US
Time-zone aligned with US Central, direct flights to all major US hubs, lower cost than Mexico for comparable operations, strong English proficiency in the GAM (Greater Metropolitan Area). Major presence: Intel (semiconductor packaging post-2023 partnership), HP, Baxter, Boston Scientific, Edwards Lifesciences, Smith & Nephew, Procter & Gamble, Amazon, Microsoft, Roche.
Medical devices & precision manufacturing
Latin America’s leading medical-device export hub. Now Costa Rica’s largest export sector by value, ahead of bananas, coffee and pineapples. 70+ medical-device companies (Edwards, Boston Scientific, Baxter, Smith & Nephew, Abbott, Cardinal Health and many others). Strong supplier ecosystem developed around the FTZs over 30+ years.
Stable democracy, no army
Latin America’s longest-running stable democracy. Army formally abolished in 1948 — the only Central American country without a standing military. Freedom House consistently ranks Costa Rica as "Free" with the highest scores in Central America. Rule of law, independent judiciary, peaceful transitions of power. The institutional baseline is genuinely exceptional for the region.
Strong English proficiency
One of the highest English proficiency rates in Latin America, particularly in the Greater Metropolitan Area (San José, Heredia, Alajuela, Cartago). Bilingual education widespread. English is the working language of most FTZ-located multinationals. Materially reduces friction for US/UK/European groups setting up operations here vs other Central American options.
Semiconductor partnership
July 2023 Costa Rica-US semiconductor partnership under the CHIPS Act framework specifically positions Costa Rica as a strategic ATP (Assembly, Testing, Packaging) hub for the US semiconductor supply chain. Intel has anchored Costa Rican operations since 1997 and was reinforced by the 2023 partnership. Material story for any chip, advanced manufacturing or semiconductor supply-chain investor.
CAFTA-DR & trade network
CAFTA-DR (Central America-Dominican Republic Free Trade Agreement) in force with the US since 2009 — tariff-free access to the US market for most products. EU-Central America Association Agreement. China FTA. Mexico, Chile, Peru, Singapore FTAs. CARICOM partnership. Pacific Alliance observer. Comprehensive trade network for a 5.2m-population country.
Floating colón, free FX
Costa Rican Colón (CRC) floats on a market-based exchange rate. Independent central bank (Banco Central). Free capital flows, free profit repatriation, free dividend remittance. USD widely used in parallel for FTZ operations and major commercial transactions. Free Trade Zone entities have explicit discretionary FX use. Materially simpler than Argentina (cepo cambiario) or pre-2026 Brazil.
Five legal structures — one usually fits.
For most foreign investors, the choice is between an S.A. and an S.R.L. — the two principal vehicles in Costa Rica. Fiscal treatment is broadly identical. The Free Trade Zone (FTZ) entity sits on top of either form and is the decisive structuring choice for export-oriented manufacturing or services. The branch and rep office serve specific narrow use cases.
Sociedad Anónima
The traditional Costa Rican corporation. Minimum 2 shareholders at incorporation (can consolidate to 1 afterwards). Bearer or registered shares (UBO must be disclosed). Mandatory board of directors with President, Secretary, Treasurer, Comptroller (Fiscal). The traditional default for inbound foreign investment, particularly larger or longer-term operations. Standard 30% CIT or progressive 5-30% for SMEs.
Sociedad de Responsabilidad Limitada
The Costa Rican LLC. Minimum 2 members at incorporation. Quota-based (not share-based) ownership. Single manager possible. Lighter governance than the S.A. (no mandatory Comptroller). The two structures are fiscally identical with the exception of shareholder loan treatment. Increasingly chosen for closely-held operations and smaller foreign-invested structures.
FTZ Entity (Law 7210)
S.A. or S.R.L. qualified as a Free Trade Zone user under Law 7210/1990 with PROCOMER. Up to 8 years 100% CIT exemption (extensions possible), plus VAT, tariff, real estate transfer tax and WHT exemptions. Discretionary FX use. Service-company access since Law 9689/2019. The decisive structuring choice for export-oriented manufacturing, medical devices, BPO, software, logistics. Pillar 2 GMT minimum 15% applies to in-scope MNEs.
Sucursal de Sociedad Extranjera
Foreign company conducting business in Costa Rica through a registered branch. Requires Registro Nacional registration, Hacienda registration, and appointment of a resident legal representative with broad powers. Taxed at 30% CIT on Costa Rica-source income. Used where parent-level booking is structurally necessary — for most foreign investors, an S.A. or S.R.L. subsidiary is preferable.
Empresa Individual de Responsabilidad Limitada
Single-individual limited-liability vehicle. Owner must be a Costa Rican-resident individual, which limits its utility for foreign corporate investors. Largely superseded by single-member S.R.L. structures for foreign-invested setups. Still used by Costa Rican-resident entrepreneurs and certain founder vehicles.
Representative Office
Foreign company representation only. Limited to liaison, market research, and promotional activities. Cannot generate revenue or sign binding commercial contracts. Lower setup cost. Used by groups exploring the Costa Rican market before committing to a full subsidiary. Less common since the S.R.L. is itself fast and inexpensive to establish.
Talk to us first
S.A. or S.R.L. for almost all foreign-invested operations — fiscally identical, choice driven by governance preference. FTZ qualification on top for export-oriented manufacturing, medical devices, BPO/software, logistics. Branch where parent-level booking is structurally necessary. Rep office for market exploration. Pillar 2 impact assessment if your group is over €750m consolidated revenue.
Book a call →From decision to live entity.
The end-to-end registration sequence for an S.A. or S.R.L. in San José or the Greater Metropolitan Area, coordinated through our São Paulo office and senior local counsel. Standard timeline 3 to 6 weeks end-to-end. FTZ entities add 8 to 16 weeks for PROCOMER qualification and zone-operator coordination.
Structure decision & FTZ assessment
S.A. or S.R.L. (fiscally identical, governance differs). FTZ qualification assessment: export orientation, investment commitment, employment targets, qualifying sector (medical devices, electronics, software, BPO, logistics, services). Standard structure ~3–6 weeks; FTZ adds 8–16 weeks for PROCOMER review. Pillar 2 modelling for in-scope MNEs.
Foreign shareholder documents & representative
Foreign corporate shareholder documents (certificate of incorporation, articles, board resolutions, signatory powers of attorney) must be apostilled in country of origin and officially translated into Spanish by a Costa Rican-certified translator. A Costa Rican-resident legal representative (apoderado) is required — either appointed from the foreign group or via Grant & Graham’s coordinated arrangements through senior San José counsel.
Bylaws drafting (escritura constitutiva)
Draft the bylaws in Spanish defining corporate purpose (objeto social), share/quota structure, governance (President, Secretary, Treasurer, Fiscal/Comptroller for S.A.; managers for S.R.L.), registered office, fiscal year, dividend policy. Costa Rican notaries play a central role — they both draft and authorise the public deed under the Notary Code.
Notarial deed & Registro Nacional filing
Execute the bylaws as a escritura pública before a Costa Rican notary public, who then files the deed with the Registro Nacional (specifically the Mercantile Section). The Registro issues the corporate identity number (cédula jurídica) confirming the entity exists. Typical timing 1 to 2 weeks for the registration.
Registro Nacional →Hacienda registration & tax setup
Register with the Ministerio de Hacienda via the ATV (Administración Tributaria Virtual) digital platform. Activate the cedula jurídica as a taxpayer (Inscripción en el Registro Único Tributario). Register for IVA where annual gross income is expected to exceed CRC 83m (~USD 150k). Authorise mandatory electronic invoicing — all Costa Rican taxpayers must issue e-invoices through the Hacienda system.
Hacienda →UBO declaration (RTBF)
File the UBO Declaration via the RTBF (Registro de Transparencia y Beneficiarios Finales) platform. Mandatory since 2019. Annual filing each April; ordinary filing within 20 working days of incorporation. Late filing triggers fines and can block operations or government contract eligibility. We coordinate this as part of the incorporation pack.
PROCOMER & FTZ qualification (if applicable)
If pursuing Free Trade Zone status, file the application with PROCOMER (Promotora del Comercio Exterior de Costa Rica). Documentation: investment plan, employment projections, sector qualification, project description, environmental compliance. Approval triggers the Executive Decree granting FTZ status. Coordination with a zone operator (industrial park) for premises. PROCOMER review typically 8 to 14 weeks.
PROCOMER →Bank account opening
Open the corporate bank account at a Costa Rican bank (Banco Nacional, Banco de Costa Rica, BAC Credomatic, Banco Popular, Scotiabank Costa Rica, Davivienda). KYC including beneficial ownership disclosure, apostilled and translated foreign shareholder documents, cedula juridica, UBO confirmation. CRC operating account; USD account commonly opened in parallel. Typically 2 to 4 weeks — the longest single step.
Social security & labour registrations
Register with the CCSS (Caja Costarricense de Seguro Social) for social security. INS (Instituto Nacional de Seguros) for workplace accident insurance. Banco Popular contribution. Costa Rican Labour Code applies. Employer social contributions ~26–30% of gross salary (gradually rising to 12.16% pension component by 2029). Mandatory 13th-month payment (Aguinaldo). Strict compliance regime.
Ongoing tax, statutory & compliance
Annual income tax return D-101 due 15 March (calendar tax year). Monthly IVA return D-104 due 15th of following month. Annual D-151 summary of payments and withholdings due last business day of February. Annual UBO/RTBF declaration each April. Annual Legal Entity Tax in January. Municipal tax filings. Mandatory e-invoicing. Transfer pricing for cross-border related-party transactions. Pillar 2 monitoring for in-scope MNEs.
What it costs to incorporate & run.
All figures are indicative for a standard S.A. or S.R.L. in San José with one foreign corporate shareholder. Costa Rica is reasonably efficient for incorporation — comparable to Chile and Colombia. The Free Trade Zone qualification process adds substantial scoping, application, and zone-operator coordination work, justifying a meaningful cost differential.
One-time setup
FTZ entity: add €4,500–7,500 for PROCOMER application, zone-operator coordination, sector qualification work — total €8,000–14,000. Branch setup €4,500–7,500 (additional registration complexity). Pillar 2 scoping for in-scope MNE groups: separate engagement.
Ongoing monthly / annual
FTZ entities: additional PROCOMER reporting (annual compliance reports), employment and investment commitment monitoring. Statutory audit for larger entities and FTZ users. Transfer pricing documentation mandatory for cross-border related-party transactions above thresholds. Pillar 2 GMT compliance for in-scope MNE FTZ users (15% minimum effective tax monitoring and top-up tax compliance).
Get an estimate in 30 seconds.
Three quick questions. We will give you a realistic cost range and timeline for your situation, and route the answers straight into a fixed-price quote request from our São Paulo office.
Which company structure are you considering?
How is the shareholding structured?
What do you need from us?
The legal framework to know.
A summary of the core legislation governing companies in Costa Rica. Substantive work delivered through Grant & Graham’s São Paulo office and senior San José legal, tax and accounting counsel.
Corporate Law
- Código de Comercio (Commercial Code)
- S.A. and S.R.L. framework
- Registro Nacional Mercantile Section
- UBO/RTBF Law (since 2019)
Tax Law
- Income Tax Law Ley 7092
- IVA Law Ley 9635 (2019)
- Free Trade Zone Law Ley 7210 (1990)
- EU-driven substance reform Ley 10381 (2023)
Labour Law
- Código de Trabajo (Labour Code)
- Aguinaldo (13th-month payment)
- CCSS social security framework
- INS workplace accident insurance
Data Protection
- Personal Data Protection Law Ley 8968 (2011)
- PRODHAB (data protection agency)
- Habeas Data constitutional right
- OECD-aligned framework
Foreign Investment & FX
- National treatment framework
- Banco Central de Costa Rica
- CINDE (FDI promotion agency)
- PROCOMER (foreign trade promotion)
Intellectual Property
- Trademark Law Ley 7978
- Patent Law Ley 6867
- Copyright Law Ley 6683
- Registro de Propiedad Industrial
Costa Rica, answered.
Four steps from enquiry to live entity.
Discovery call
30-minute conversation to understand your business, sector, FTZ eligibility (export orientation, investment commitment, sector fit), S.A. vs S.R.L. preference, Pillar 2 impact if in-scope, Law 10381 substance considerations. Honest assessment of fit.
Recommendation
Senior advisory on the right structure, FTZ qualification scoping if relevant, registered capital, Costa Rican-resident representative arrangements, banking partner, sector licensing, Pillar 2 modelling. Fixed quote in EUR or USD.
End-to-end formation
Bylaws, notarial deed, Registro Nacional, Hacienda, UBO/RTBF, CCSS, banking, sector licensing, PROCOMER FTZ qualification where relevant. São Paulo-coordinated, executed through senior San José counsel.
Ongoing support
Retained accounting, monthly IVA D-104, payroll/CCSS, annual D-101, D-151, UBO refresh, Annual Legal Entity Tax, transfer pricing, Pillar 2 monitoring for in-scope MNEs, FTZ compliance reporting where applicable.
Ready to incorporate in Costa Rica?
Tell us in 25 minutes what you need. We will tell you honestly whether Costa Rica is the right fit, which structure makes sense (S.A., S.R.L., Free Trade Zone), whether FTZ qualification is worth pursuing for your operation, and how Pillar 2 GMT and Law 10381 substance rules affect your structuring — then handle the setup end-to-end through our São Paulo office and senior San José counsel.