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Costa Rica: Remote Worker Visa Introduced

August 11, 2021

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Country / Territory

  • Costa RicaCosta Rica

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At a Glance

  • The Costa Rican government has approved a law that will create a remote work visa, which will go into effect when published in the Official Gazette, expected in the next few weeks.
  • The remote work visa will allow eligible foreign nationals who are employed outside Costa Rica or who provide services to persons or entities outside Costa Rica to reside in and work remotely from Costa Rica for up to one year, without local employer sponsorship.
  • However, the visa does not allow foreign nationals to perform local remunerated work in Costa Rica.

The situation

The Costa Rican government approved a law creating the “Short-term Visa for Remote Workers or Service Providers”. The visa allows foreign nationals who are employed outside Costa Rica or who provide services to persons or entities outside Costa Rica to reside in and work remotely from Costa Rica, without local employer sponsorship.

A closer look

  • Duration. The visa is valid for one year, with a one-time extension of one additional year.
  • Eligibility. Applicants must prove they have had a stable average monthly income of at least USD 3,000 (or USD 4,000 if accompanied by dependents) for the past year through bank statements or other documentation as determined by the General Immigration Directorate.
  • Health insurance requirement. Applicants and their families must hold private medical insurance valid for the entire duration of their stay in Costa Rica.
  • Process. The government expects to adjudicate these applications in 15 calendar days from the date of filing through a streamlined digital application process.
  • Tax and other benefits. The law offers tax benefits for the principal visa holder, including exemptions from income tax and from taxes on importing technological work equipment. It also offers visa holders the ability to use their foreign driver’s license to drive in Costa Rica and open savings accounts in national banks.
  • Eligibility for renewal. To renew the visa for one additional year, visa holders must have remained in Costa Rica for at least 180 days during the initial one-year period.

Impact

  • Working remotely. The visa offers foreign nationals an option to work remotely from Costa Rica, whereas other visa options in Costa Rica either require company sponsorship or do not automatically confer work authorization.
  • Local work restricted. Visa holders cannot perform local remunerated work in Costa Rica.

Background

  • Economic recovery. Costa Rica’s tourism sector, and, as a result, the Costa Rican economy has been significantly affected by the COVID-19 pandemic. Consequently, Costa Rica created this new visa category to attract long-term visitors and increase local economic activity due to the flexibility in work locations that many employers are now allowing. The law is part of the government’s continued plan to attract foreign investment in Costa Rica and follows the recent introduction of immigration and other benefits for investors and retirees.
  • Increase in remote work visas. Remote work has become increasingly popular among employees globally due to the COVID-19 pandemic. As a result, at least 19 countries have implemented remote work visa programs in the last year and a half, including countries in Latin America and the Caribbean such as Antigua and Barbuda, the Bahamas, Barbados, Bermuda, Cayman Islands, Curacao, Dominica and Panama.
  • Remote work visa warning. In countries where remote work is unregulated, workers and employers may unknowingly put themselves at risk of noncompliance with many aspects of the law, exposing them to possible fines or other penalties, depending on the country. Importantly, noncompliance with regulations could result in employers losing their rights to hire foreign labor. Additionally, this type of work arrangement may have employment or tax law impacts. Employers should also consider tax and labor law implications beyond the scope of immigration-related impacts as part of their decision-making process.

Looking ahead

The new law will go into effect when it is published in the Official Gazette, expected in the next few weeks. Further details on the application process for the remote work visa will be available in the next 60 days when the General Immigration Directorate publishes accompanying immigration regulations.

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].

Country / Territory

  • Costa RicaCosta Rica

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