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Income tax in Costa Rica 2026
Employees are taxed through a final monthly withholding: 0% up to CRC 918,000, then 10-25%, with 25% starting above CRC 4,727,000 a month — and no annual return.
The self-employed use an annual scale with the same 0-25% span, a flat 25% no-receipt expense deduction, and a 15 March filing deadline.
At a glance
- top rate
- 25% (above CRC 4,727,000/month employment; above CRC 20,872,000/year self-employed)
- entry band
- 0% up to CRC 918,000/month (employment) or CRC 6,244,000/year (self-employed)
- tax year basis
- Calendar year
- filing deadline
- 15 March (self-employed only)
- residency basis
- Territorial; resident at 183+ days including arrival and departure days
- regime flag
- Family credits: CRC 1,710/month per child, CRC 2,590/month per spouse
Rates
Employment income — final monthly withholding (2026)
| Monthly income (CRC) | Rate |
|---|---|
| 0 – 918,000 | 0% |
| 918,001 – 1,347,000 | 10% |
| 1,347,001 – 2,364,000 | 15% |
| 2,364,001 – 4,727,000 | 20% |
| Over 4,727,000 | 25% |
Marginal rates apply within each band.
Self-employed and business income — annual scale (2026)
| Annual taxable income (CRC) | Rate |
|---|---|
| 0 – 6,244,000 | 0% |
| 6,244,001 – 8,329,000 | 10% |
| 8,329,001 – 10,414,000 | 15% |
| 10,414,001 – 20,872,000 | 20% |
| Over 20,872,000 | 25% |
Marginal rates apply within each band.
Thresholds & allowances
- Child creditCRC 20,520 a year (1,710/month)
Per child under 18, or under 25 in higher education, or disabled
- Spouse creditCRC 31,080 a year (2,590/month)
Unless legally separated; only one spouse may claim it
- No-receipt expense deduction25% of gross income
For all independent service providers from 2026 — or actual documented expenses instead
- 13th-month bonusExempt up to one-twelfth of annual pay
The Christmas bonus stays tax-free within the limit
Residency
Residency trigger
You are resident after more than 183 days in the country in the tax year, counting arrival and departure days — but because taxation is territorial, residence changes little: everyone pays only on Costa Rican-source income.
Non-resident treatment
Non-residents face final withholdings on Costa Rican payments — 10% on salaries (15% under some case law), 25% on professional fees, 15% on dividends and interest.
Notes
- Brackets adjust every year with the central bank's price indexes — the 2026 figures edged down slightly as prices fell.
- The self-employed make three advance payments (end of March, June and September) totalling 75% of the prior year's tax or the 3-year average, whichever is higher.
- Someone with several employers must ask one of them to withhold on the combined salary; the tax-free band can be used only once across employment and independent income.
- Pensions are taxed like salaries through withholding, but benefits from the complementary pension regime are fully exempt.
- Foreign taxes are neither creditable nor deductible — unnecessary under territoriality, since foreign income is not taxed at all.
FAQ
What is the top income tax rate in Costa Rica?
25% — above CRC 4,727,000 a month for employees, or above CRC 20,872,000 a year of net income for the self-employed.
Does Costa Rica tax foreign income?
No — 0%. Foreign salaries, pensions, dividends and gains are outside the territorial system for residents and non-residents alike.
Do employees file tax returns in Costa Rica?
Not for salary alone — the monthly withholding at 0-25% is final; only other-income earners file, by 15 March.
Figures: tax year 2026, compiled from public sources. Not tax advice.