Costa Rica is one of Latin America’s most stable and business-friendly markets, making it a prime destination for legal entity setup. With an educated bilingual workforce, political stability, and strong protections for foreign investors, it consistently attracts multinational companies. As a member of the OECD, Costa Rica also aligns with global standards on transparency, data protection, and taxation.
Whether you’re planning long-term investment, scaling regional operations, or launching a shared services hub, legal entity setup in Costa Rica provides the credibility and structure needed for sustainable growth.
Unlock growth opportunities in Costa Rica with Cerity Global as your trusted partner. We offer end-to-end support for establishing your legal entity, navigating Costa Rica’s often complex regulatory landscape with clarity and efficiency.
From company registration to ongoing back-office support, including HR, payroll, benefits, accounting, tax and compliance, Cerity Global simplifies the process so you can focus on growing your business.
Need to hire quickly before your entity is set up? We offer interim EOR services in Costa Rica, enabling you to onboard talent fast. Once your entity is established, we ensure a smooth transition of your employees from the EOR structure to your own legal entity, without disrupting payroll or compliance.
Our experts stay ahead of regulatory changes to keep your operations aligned with Costa Rican employment and tax laws, helping you scale confidently and compliantly.
Also known as a corporation, it requires at least two shareholders, and the shares are transferable. Mostly used by medium to large businesses, it is managed by a board of directors which must have at least three members: President, Secretary, Treasurer.
Also known as a limited liability company, it is the most common choice of entity set up for entrepreneurs. It provides flexibility and limited liability protection for its shareholders. An LLC is best suited for SMEs and partnerships and requires at least two shareholders
Also known as a branch, it is an establishment that carries out the parent company’s business activities either completely or partially. With a branch, the parent must appoint a legal representative in Costa Rica.
A board of directors is mandatory, consisting of a minimum of three individuals: President, Secretary, and Treasurer. One of the directors must reside in Costa Rica and act as the legal representative. Corporate directors are not permitted.
A legal representative (Gerente) is required and must be an individual. There is no board of directors. At least one representative must reside in Costa Rica and hold a local identification number (DIMEX or cédula física).
A branch must appoint a legal representative who resides in Costa Rica and holds a valid local ID (DIMEX). This representative is granted power of attorney to act on behalf of the parent company in all local matters.
In Costa Rica, a corporate bank account cannot be fully operational until after legal entity incorporation is complete. However, it is a critical part of the setup process and must follow specific steps in accordance with local financial and AML regulations.
Costa Rican banks are highly regulated and apply strict anti-money laundering checks. They may require detailed declarations of the business activity, proof of beneficial ownership, and notarized documents. Delays are common if the legal representative or beneficial owner does not have a strong local connection or if documentation is incomplete.
To open a corporate bank account, companies must provide notarized articles of incorporation (Escritura Pública), company name reservation certificate, identification of shareholders and legal representatives, proof of legal address in Costa Rica, appointment of resident agent (a licensed attorney, if shareholders are all foreign).
Cerity Global supports companies in their global expansion plans and helps in legal entity setup, registration and ongoing support services. With us, you can quickly set up a legal entity, operate compliantly, and expand globally. The process typically takes a few days to a week, depending on the bank.
Employment in Costa Rica is primarily governed by:
All employers must register with the Caja Costarricense de Seguro Social (CCSS).
Some of the standard details mentioned in the written contract include:
The different types of employment relationships are:
Also known as permanent employment, these are the most common types of employment with no end date.
Also known as temporary employment, these contracts have a stipulated end date and are commonly used for specific tasks or projects.
In Costa Rica, a probationary period typically lasts up to 3 months. However, some industries may have exceptions if sector-specific regulations exist.
The notice period in Costa Rica usually depends on the length of service, such as:
Employers must provide:
Foreign nationals can live and work in Costa Rica by securing a work and residence visa. With a valid job offer and employer sponsorship, individuals with the right skills or qualifications may be eligible for temporary or long-term work authorization.
The most common option for foreign employees hired by Costa Rican companies.
Requires labor market justification that no qualified local candidate is available.
For foreign staff relocating from a parent company abroad to a Costa Rican branch.
Designed for foreign individuals investing in Costa Rican business or property.
Ideal for self-sufficient individuals without employment.
Created for remote workers who work for companies outside Costa Rica.
Key Notes:
Annual leave in Costa Rica is 2 weeks after 50 weeks of employment with the same employer.
Maternity leave in Costa Rica is for 4 months. 1 month can be taken before childbirth and 3 months after it.
Paternity leave in Costa Rica for private sector employees is 2 days per child.
Employees in Costa Rica are entitled to paid sick leave under the country’s social security system, known as, Caja Costarricense de Seguro Social (CCSS). Sick leave compensation is shared between the employer and the CCSS and is based on the duration of the illness and proper medical certification.
The employee must submit a medical certificate issued by an accredited CCSS doctor, to be eligible for sick pay compensation.
The following statutory national holidays are observed in Costa Rica:
Additionally, the Day of Our Lady of the Los Angles) and the Day of Abolition of the Army are non-compulsory payment holidays.
The payroll frequency is usually monthly, and employees are paid on the last working day.
A 13th-month bonus, known as “Aguinaldo,” is mandatory and paid in December.
Employees in Costa Rica must pay Social Security taxes, which contribute to Social Security benefits (CCSS).
The mandatory and statutory benefits in Costa Rica are:
Accounting standards must adhere to International Financial Reporting Standards (IFRS).
Companies in Costa Rica must file annual financial statements in accordance with tax and financial reporting obligations set by the Tax Administration (Dirección General de Tributación).
Costa Rican companies must file annual financial statements with the Tax Administration (DGT).
Statutory audit is required in Costa Rica for companies that meet specific thresholds, particularly for large taxpayers and regulated entities.
The standard corporate tax rate is 30%. However, the law establishes lower rates for smaller companies ranging from 5% to 20%.
The VAT rate in Costa Rica is 13%.
Corporate tax returns are typically due by March 15th for the previous fiscal year.
Each month the tax is outstanding; a penalty equal to 1% of the tax due is imposed, up to a maximum of 20%.
Costa Rica follows OECD Transfer Pricing Guidelines, with local rules enforced under Decree No. 37898-H.
Costa Rica has implemented CbC reporting in line with OECD BEPS Action 13.
Transfer pricing documentation is required for taxpayers engaged in related-party transactions, with no minimum monetary threshold explicitly stated.
Master File
Local File
Deadline: Documentation must be prepared and made available in Spanish within 10 business days upon request by the Tax Administration. It is not required to be submitted unless specifically requested.
Data protection in Costa Rica is governed by two main laws:
As of 2025, a new draft bill aligning Costa Rican law with the EU GDPR is under congressional review.
Costa Rica’s AML framework is governed by Law No. 8204, which combats money laundering and terrorism financing in alignment with FATF recommendations.
Obligated entities: Financial institutions, real estate firms, accountants, auditors, lawyers, notaries, and trust service providers.
Key requirements:
Penalties: Fines, business closure, or criminal prosecution under Costa Rican law.
Reasons you should setup legal entity in Costa Rica:
Cerity Global ensures your business expansion in Costa Rica is fast, compliant, and future-ready, so you can focus on growth while we manage the back-office tasks.
Economic figures are subject to change based on quarterly reports and market conditions.
Cerity Global combines deep local knowledge with proven expertise to make your Costa Rica business establishment effortless and compliant. Whether you’re looking for legal entity setup and registration or ongoing support, we’re your trusted partner for sustainable global expansion in Costa Rica.
Disclaimer – The information provided is for informational purposes only and does not constitute legal, business, or tax advice. Entity setup requirements, tax rates, and economic data are subject to change and may vary by location. Cerity Global disclaims any liability concerning the accuracy, completeness, or currency of this information.
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