The Solidarity Tax, commonly known as the “Luxury Homes Tax,” is a levy that applies to properties with a construction value exceeding ₡145 million. This tax, in effect in Costa Rica, must be declared and paid between January 1st and January 15th.
If you own a property that falls into this category, it is crucial to understand the rules and requirements to comply with this tax obligation and avoid penalties.
Who Must Pay the Solidarity Tax?
This tax applies to:
Properties with a total value (including land and construction) exceeding ₡145 million.
Condominiums, also taking into account the proportional value of common areas assigned to each unit.
Applicable Rates:
The tax rates range from 0.25% to 0.55% of the total property value. These rates are updated annually.
Deadlines and Validity:
- Declaration and Payment: Between January 1st and January 15th.
- Frequency: The declaration is submitted every three years, setting the reference value for the subsequent cycle. For the 2025–2027 period, changes in reference data from 10 cantons will be considered.
Importance of the Declaration:
- Including the total value of the property is mandatory.
- Any changes to the property’s characteristics since the last declaration must be reported.
- For condominiums, the proportional value of common areas must be calculated.
Consequences of Non-Compliance:
The tax authority will enforce payment of the tax with interest and penalties for those who fail to meet the deadline.
How to Prepare?:
- Review the current value of your property and common areas if you live in a condominium.
- Check the updated values and applicable rates.
- Submit the declaration and payment within the established timeframe.
Complying with the Solidarity Tax declaration and payment is essential to avoid penalties and keep your tax obligations up to date. If you need expert assistance, the ERP Lawyers team is ready to help you meet all the requirements. Contact us to ensure efficient and hassle-free tax management.
