Costa Rica Expertise LLC

Beach house before destruction order.

Beach house is on its way down!

By Garland M. Baker
Special to A.M. Costa Rica

If they have property in the maritime zone, expats can look forward to a hard time this year from municipalities up and down the coasts. If that is not enough stress for 2008, the Ministerio de Ambiente y Energía will be in line to add more tension. Some expats may be losing their comfy beach houses if they are located in the wrong places.

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Norwegian artist Edvard Munch could have been thinking of bureaucracy as inspiration for his famous 1893 painting "Scream."

By Garland M. Baker
Special to A.M. Costa Rica

What is Tributación Directa doing? One does not know whether to get drunk, curse or cry.

Tributación Directa is the tax collecting agency.

Last year, taking company books to be legalized was a long process in San José. A registrant had to fill out a form, play musical chairs, and then leave the five or six books for over a month.

In February, the tax department decided to become efficient. The first thing officials did was make a new rule that made all unused, printed legal books currently in existence obsolete. They wanted the first page of any book they legalized to have a special form imprinted on it.

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By Garland M. Baker
Special to A.M. Costa Rica

It is tax time again. Tax returns for individuals and companies are due on Friday. Yes, this Friday.

Every company is required to register with the taxman. This registration happens when one gets a set of legal books approved at the tax authority, Tributación Directa. The form to do so changed this year from one without a number to Form 406. The old form had no number and was clumsy looking. It can still be used until Friday, but starting Monday, to register a company to get legal books authorized one must use the new form.

There are several important deadlines for taxpayers in Costa Rica. The most important ones for expats are Dec. 15 when Form 101 for income taxes is due and March 31 when Form 110 for education and cultural taxes is due.

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By Garland M. Baker
Special to A.M. Costa Rica

Now there is a new way to duck messy probate in Costa Rica.

Thanks to an avid reader with a ton of patience, a limited liability company called an S.R.L. in Costa Rica, is now an even better vehicle for holding assets and succession planning. Most professional people do not know this secret.

Limited Liability companies are great for holding properties and managing businesses, but if there is only one manager and the manager is taken by death, a long legal struggle can take place.

If there are multiple managers, the liability company runs the risk of internal confusion and sometimes theft.

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By Garland M. Baker
Special to A.M. Costa Rica

First there was arithmetic, and then came new math, and now Costa Rica has introduced tax math.

Aristotle, the Greece philosopher, was the first ever to theorize this kind of geometric mathematics in his book The Physics. So no one should be surprised Tributacion Directa, the Costa Rican tax authority, much like the IRS in the United States, and Hacienda, the Costa Rican treasury, has decided to use it in calculating tax values on property.

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