New Law Introduces Immigration and Other Benefits for Investors and Retirees
July 6, 2021
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At a Glance
- A new law has been approved which relaxes requirements for the Temporary Residence category for foreign retirees (pensionados), investors and those who live off income from their investments (rentistas).
- The law reduces the minimum investment required for the investor category, streamlines processing, and provides tax benefits to holders.
- The changes are intended to attract foreign investment in Costa Rica in order to boost economic recovery and growth during the COVID-19 pandemic.
- The law will go into effect when it is published in the Official Gazette, expected in the next few days.
The situation
The government has approved a law that introduces improvements to the Temporary Residence category for foreign retirees (pensionados), investors and those who live off income from their investments (rentistas). The law will go into effect when it is published in the Official Gazette, expected in the next few days.
A closer look
Benefits of the new law include:
| New Rule | Current Rule | Impact |
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Investor status requires a minimum investment of USD 200,000 in Costa Rica in tangible property, shares, negotiable instruments, productive projects, or projects which are deemed of national interest in Costa Rica. |
Foreign nationals will find it easier to qualify for investor status since the minimum requirements have decreased and the types of investments deemed acceptable have expanded. As a result, Costa Rica may become a more attractive destination for foreign nationals looking to move to, invest or retire in another country. |
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Temporary Residence applications under this category are taking approximately 10-12 months to be adjudicated from the date of filing. |
Foreign nationals applying under these categories will be able to obtain their Temporary Residence permits and move to Costa Rica in a shorter period of time. Specific details on the application process are forthcoming, when the General Immigration Directorate publishes the accompanying immigration regulations to the new law. |
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Foreign nationals under this category are not eligible for tax exemptions. |
Eligible applicants will find a more favorable tax scheme under these categories but should consult a professional for tax and other legal implications. |
Background
- Temporary Residence category. Self-sponsored individuals are qualified for Temporary Residence if they can make a minimum investment in Costa Rica (investors); prove that they have financial access to at least USD 2,500 per month for at least two years (rentistas); or have a monthly income paid by a government entity for life of at least USD 1,000 (pensionados).
- COVID-19 impact on Costa Rica’s economy. The COVID-19 pandemic has had a dramatic impact on Costa Rica’s tourism sector (which generated approximately 8.2% of the country’s GDP pre-COVID-19) and in turn on the Costa Rican economy.
- Purpose of improvements. The changes are part of the government’s continued plan to attract foreign investment in Costa Rica to boost economic recovery and growth in the midst of the COVID-19 pandemic.
Looking ahead
The new law will go into effect when it is published in the Official Gazette, expected over the next few days. Further details on the new process will be available in the next 60 days when the General Immigration Directorate publishes accompanying immigration regulations to the new law.
Additional changes to immigration policies in Costa Rica are likely forthcoming as the government focuses on remobilization and economic recovery. A proposed law, in its final stage of approval, is expected to create a Short-term Visa for Remote Workers or Service Providers, which would allow eligible foreign nationals to reside and work remotely from Costa Rica.
This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
