Sales Tax & Digital Invoicing

Sales Tax or Impuesto de Valor Agregado (IVA) is mandatory for anyone who sells goods or services in Costa Rica. The rate is 13% and you will find it in anything you buy and will need to add it to all sales made through the factura electrónica or Digital Invoicing. Its purpose is to reduce tax fraud and it requires monthly declarations and payments.

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For example: if you own a property in Costa Rica and a contractor renovates your kitchen for $10,000, he will have to send you a factura electrónica for $10,000, plus the 13% IVA, for a total of $11,300. The Costa Rican tax agency, Departamento de Hacienda, will automatically receive an electronic copy of this “factura”. When the contractor receives your payment, he will owe the 13% ($1,300) to the Departamento de Hacienda.

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Same concept applies to all the sales you make, the 13% must be added to the total.

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So, when the end of the month comes and its time to file and pay your sales tax, you can deduct the 13% that was charged to you on all your expenses to reduce the final paying amount.

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Luckily, Eden Properties in collaboration with our quality accountants will take care of this for you, making all the facturas electronicas to add the 13% to all sales and also processing all your expenses so that when the end of the month comes all the deductions, filing and payments can be made. 

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The process is as follows: Every factura electrónica contains three documents — one PDF and two XML documents that must be uploaded into a software. We manually accept the electronic invoice and then store it in the appropriate tax group. The system allows you to keep all documents for five years, but it is recommended to always save your PDFs.

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If you have any questions on this issue, don't hesitate to contact us. We are happy to help, and  committed to making your life as easy as possible in a complicated business environment.