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(506) 2223-1327        Published Monday, Dec. 8, 2008,  in Vol. 8, No. 243       E-mail us
Jo Stuart
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Tax tips for expats who want a comfortable holiday
By Garland M. Baker
Special to A.M. Costa Rica

Here is the help one needs for this year's tax season.  Most expats hold their Costa Rican assets in a company.  Whether it be a sociedad anónima  or a sociedad de responsabilidad limitada — also known as an S.R.L. or in Gringo speak an L.L.C. — expats have tax obligations like Costa Ricans.  However, most expats use inactive companies to hold the assets, and tax obligations are different for active and inactive companies.

Active companies are those that perform some commercial activity and receive revenue.  These companies must file Costa Rica tax form D-101 by Monday, Dec. 15.  Any taxes due also must be paid by this date.

Inactive companies are those that may only hold assets and only exist for that purpose. The asset could be properties or vehicles.  These companies do not need to file any form or pay any tax by the filing date mentioned above.  This is a great relief for most expats because they only have inactive companies and not active ones.  However, it is very important to check to see if a company is considered active or inactive by the tax department, Dirección General de Tributación.

Here is how to check:  1.) go to the "Sistema de Identificación de Contribuyentes,"  the taxpayer identification system, 2.) in the section at the bottom of the Web page called "Consulta de Personas Jurídicas" type in the company's cedula number or company identification number. Do not use dashes. Just type the string of numbers with no spaces and/or the company's razón social, the company name, and 3.) then click buscar, "find" button under the box. 

The Web page will then return the following information under the box: 1,) sin obligaciónes, meaning the company is inactive and has no tax obligations, 2.) con obligaciónes, meaning the company does have tax obligations, or 3.) no hay registros en el rango solicitado, meaning there are no records on file for the company.

If the company being checked is sin obligaciónes, it is inactive.  If that information is correct, and the company only holds assets and is truly inactive, one can go back to having morning coffee. Everything is the way it should be and nothing needs to be done. No tax form needs to be filed, and no taxes are due until March when the pesky education and culture taxes, Timbre de Educación y Cultura, needs to be filed and paid.

If the result is con obligaciónes, and one is running a commercial enterprise, the person in charge has to get those tax forms filed and to pay the tax before the deadline.  Sometimes the tax people make a mistake, and a company is con obligaciónes when it should not be.  If this happens, the responsible party needs to file form D-140, Declaración de Desinscripción del Registro de Contribuyentes. a "declaration to unregister as a taxpayer," with the tax department to put it in an inactive status. 

Finally, if the company is not registered at all because the No hay registros en el rango solicitado message appears, the company is not properly registered with the tax department.  One should register the company using form D-406, Solicitud de Legalización de Libros, solicitation to legalize books.

There was a time the tax people wanted all companies to file tax forms but no more.  The tax department actually legalized all company books for all companies until last year, now they will not even accept accounting books, only legal books for registration.  Today, it is very important not to file a tax form for an inactive company because by doing so the company is automatically made active and con obligaciónes.
help for taxes

The fact that the Dirección General de
Tributación will no longer legalize accounting books is somewhat in contradiction to the Costa Rican Commercial Code Article 251, which states that corporate entities must have legal accounting books.  Most expats know that Costa Rica is a land of contradictions and that multiple interpretations exist of the law and rules, so one just needs to go with the flow.

All companies should have an annual meeting according to the commercial code where a balance sheet is presented and discussed among shareholders.  In practice, for inactive companies, the meeting event usually does not take place physically.  A minute act is written into the shareholders' book that one did take place somewhere and the shareholders sign the book from time to time.  If these minutes do not exist, most legal books are blank for inactive companies, they should be consolidated into one entry where the shareholders approve the current state of affairs of the entity including its balance sheet.

Expats working in Costa Rica who make an income and who are not on a company payroll should register with the tax department as individuals, file and pay taxes.  The Dec. 15 tax deadline also applies to them.  However, many expats are in Costa Rica working illegally and do not register or pay the taxes they should pay.  In essences, they are working illegally and are evading taxes as well. In the past, few have been caught because the cross checking system has not been very good.  This will significantly change for the 2009 tax year, and expats who are not paying their due will surely be increasing their exposure to being caught and charged with hefty fines.

To enjoy the Christmas holidays, get the tax obligations out of the way early.  There are only seven filing days to Dec. 15. Usually, the banks that take tax forms (Some do and some do not) have long lines during the last days.  This year those would be Friday, Saturday and of course Monday of next week, the final day.  Some banks get into squabbles with the tax authority and decide not to receive the forms.  The best advice is to try one bank and then another until one is found that will take the D-101 income tax form. 

Remember, inactive companies do not need to file.  All expats should take the time to check out their companies to see if they are properly registered.

Garland M. Baker is a 36-year resident and naturalized citizen of Costa Rica who provides multidisciplinary professional services to the international community.  Reach him at  Baker has undertaken the research leading to these series of articles in conjunction with A.M. Costa Rica.  Find the collection at, a complimentary reprint is available at the end of each article.  Copyright 2004-2008, use without permission prohibited.

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Cleaning out the mud

Our reader reports
Sixaola is still a real mess

our visiting readers report

Dear A.M. Costa Rica:

Since business required us to be in the immediate area of the disastrous flooding that had devastated the town of Sixaola and other small towns in the neighboring vicinity, my husband and I took time to look around at what the receding water had left.

Mud… just lots of mud!

Along one street there had been a couple of sodas, a family owned supermarket and some other small businesses, but the only things selling now was fresh water and rubber boots.

While we were there the local fire truck was pumping water into the local high school to try to clean this brackish mess off the first story. The water had reached into the second floor where the school library was housed.

If you can, please donate whatever you can afford to help the people in these towns, to get back to some type of normal living routine, especially with the upcoming Christmas season, and those who live here, know how these lovely, caring Ticos enjoy this time of year.
Patricia Nethercote
Guayabo de Bagaces

EDITOR'S NOTE: Donations are being taken by the Cruz Roja at a number of supermarkets. Bank accounts also have been established for cash donations.

sixaola boots
The town's biggest sellers.

Gasoline prices dropping
when new rate published

By the A.M. Costa Rica staff

Super gasoline is going down 152 colons a liter (about 28 U.S. cents), and gasoline plus is dropping 150 colons, as a result of a decision taken by the regulating agency and announced Friday. Diesel drops 87 colons (about 16 cents).

The Authoridad Reguladora de los Servicios Públicos said the new price for super would be 488 colons a liter or about 89 U.S. cents. Plus, 91 octane, will be at 474. Diesel will be at 522 (85.3 cents) per liter when the decision is published in the La Gaceta official newspaper at the end of this week.

There are 3.798 liters in a U.S. gallon, so the gallon price of super will be about 1,853 colons or $3.38.

The regulating agency calculated the price based on the cost of petroleum and the value of the dollar between Oct. 30 and Nov.13.

The agency is always behind the dropping or rising price of petroleum because the new price is set just once a month.

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San José, Costa Rica, Monday, Dec. 8, 2008, Vol. 8, No. 243

An expat wish list of proposed constitutional changes
By the A.M. Costa Rica staff

The Arias administration is making moves to change the nation's Constitution because officials think that the current document makes the country ungovernable.

Administration officials have not said what they have in mind, but here are some suggestions from the expat point of view:

1. How about changing this part of the existing document:

ARTICLE 133. The election for president and vice presidents shall be held on the first Sunday of February of the year in which these officials are to be elected.

The first Sunday in February also happens to be Superbowl Sunday, and the election dry laws greatly hamper the celebration of the expat national holiday.

2. How about extraditing Costa Ricans who have committed crimes elsewhere. The current Constitution says "ARTICLE 32. No Costa Rican may be compelled to abandon the national territory." We would like to see locally born muggers, rapists, murderers and other crooks sent away to face trial for crimes committed elsewhere.

3. This is in the Constitution now: "ARTICLE 30. Free access to administrative departments for purposes of information on matters of public interest is guaranteed."

However, such laws do not do much unless they have criminal penalties attached. So a sentence that says deliberately withholding information from any person is a felony or delito would be appropriate.

4. This is also in the Constitution: "ARTICLE 29. Every person may communicate his thoughts verbally or in writing and publish them without previous censorship; but he shall be liable for any abuses committed in the exercise of this right, in such cases and in the manner established by law."

That sounds a lot like what Thomas Jefferson wrote for the new State of Virginia. A better choice would be the negative liberty expressed in the U.S. Bill of Rights, starting with "Congress shall make no law . . . "  The difference is significant.
5. While on the topic of freedoms, consider "ARTICLE 75. The Roman Catholic and Apostolic Religion is the religion of the State, which contributes to its maintenance, without preventing the free exercise in the Republic of other forms of worship that are not opposed to universal morality or good customs."

Is it not about time to recognize that many citizens believe many other creeds or none at all and stop the financial support to churches?

6. Articles 108 and 109 specify the requirements for individuals to be elected to the Asamblea Legislativa. Here's a chance for Costa Rica to lead the way and make it clear that lawyers are members of the judicial branch and may not be elected to a legislative seat or to posts in the executive branch. We have far too many legal eagles complicating public life. 

Lawyers should be advisers, not voting lawmakers.

7. Then there is Article 96 that spells out state financing of political parties. Ever wonder why there are so many political parties? If a party gets 4 percent of the popular vote, it gets to share in public financing. They should earn their own money.

8. Then there is the matter of punishment. Punishment is addressed here: "ARTICLE 40. No one may be subjected to cruel or degrading treatment or to life imprisonment, or to the penalty of confiscation. . . ."

What Costa Rica needs now is life imprisonment and then some for the more violent in society. And also for the arrogant bank tellers and alleged public servants.

The Corte Suprema de Justicia is in charge of crime and punishment. The new constitution should require each high court magistrate to take a 15-minute walk at midnight once a week through the finer areas of the downtown. The country quickly would have some tougher laws and probably a few new magistrates.

9. Although this is not an A.M. Costa Rica editorial position, some expats would like to see a clear statement in a new constitution allowing individual use of mind-altering drugs. That is the de facto situation now.

The traditional holiday fare, the tamal, is a learned taste
By the A.M. Costa Rica staff

There is a great truth about the tamal, the Costa Rican national Christmas meal. The dish is an acquired taste.

Very few new arrivals dig right in to a Costa Rican tamal. Some conditioning is required. The corn taste is strong and not usually found in North American dishes.

A reporter on the hunt for a delicious tamal said Sunday that she could not stand the dish. Meanwhile, millions of Tico mouths are watering for the treat. The interest is so great that the Municipalidad de San José gave away some 10,000 tamales Saturday in a Christmas promotion on the downtown pedestrian boulevard.

Now the tamal, or tamale, as it is called in English, has a wide acceptance in the Americas, but the contents and presentations vary. For example, there is a sweet tamal, wrapped in a corn husk, and one without any filling. The South American arepa could be considered the offspring of a tamal.

In Venezuela, the name is hayaca, but the form is the same. Corn flour or corn meal wrapped around meat, raisins, olives, chiles or other goodies, then wrapped water tight in banana leaves. The community of Aserrí south of San José has developed a reputation for quality and quantities of tamales. And there are stores that just sell the masa or mixed corn flour by the kilo for home or restaurant use.

For those seeking just a taste, tamales of pork, beef and even vegetarian are on sale in the dairy department of
A.M. Costa Rica/Elyssa Pachico
Usual presentation of a tamal: The banana leaves are opened by the diner.

local supermarkets. They already have been baked, probably over a wood fire in Aserrí. The idea is to drop them in boiling water or place in the microwave to heat them up and then peel off the string and the banana leaves to reach the doughy mass inside. Two tamales tied together in the traditional manner are called a piña.

The dish can be eaten with various sauces. Lizano is a favorite. But the brave prefer something more spicy like tabasco.

A little health tip: Courtesy dictates that you do not eat the banana leaves.

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San José, Costa Rica, Monday, Dec. 8, 2008, Vol. 8, No. 243

Swiss and U.N. are seeking a world court of human rights
By the A.M. Costa Rica wire services

The Swiss government is launching an agenda for human rights that aims, among other things, to establish a world court of human rights over the next 10 years. A panel of eight "eminent persons" will oversee the work of the new organization, which has been established to mark the 60th Anniversary of the Universal Declaration of Human Rights.

The co-chairlady of the new organization, Agenda for Human Rights, is Mary Robinson. She was U.N. high commissioner for human rights in 1998 when the 50th Anniversary of the Universal Declaration of Human Rights was celebrated.

Ms. Robinson laments the past 10 years have seen a further deterioration of human rights around the world, noting incidents of genocide and ethnic cleansing. She said the dignity of millions of people continues to be violated by corruption, poverty, oppression and war.

The former high commissioner also says the emphasis on security in the post Sept. 11, 2001, world is undermining fundamental standards in relation to torture. In the name of fighting terrorism, she says people are being detained without trial and sent to countries where they will be tortured.

Ms. Robinson says the world has not lived up to the promise of the Universal Declaration of Human Rights.

"A reality that shames us frankly, that is not acceptable. If the world had taken seriously the Universal Declaration of Human Rights, we would have a world where no parents would see their children waking up in the morning crying of hunger, dying from preventable diseases," said Ms. Robinson. "There would not be more than half a million mothers dying giving birth. We would have a different
world and it would be a much more secure world, of course."

The new organization plans to carry out research projects on themes aimed at strengthening the Declaration and Human Rights. These include projects on human dignity, prevention of violence, detention, migration, statelessness, the right to health, climate change, and the creation of a world court of human rights.

One of the eminent persons on the panel is Manfred Nowak, who is also U.N. special investigator on torture. He said there is an International Criminal Court that holds individuals accountable for crimes against humanity, genocide and war crimes.

He said there are regional human rights courts in Europe, the Americas and Africa committed to protecting human rights.  But, what is lacking, he said, is a world court on human rights that can deal with violations globally. The interamerican court is located in San José.

"We would go beyond the powers of regional courts, by in particular taking into account that in a global world, we have global responsibilities that go beyond State responsibilities. But also holding accountable inter-governmental organizations or transnational corporations or others that violate human rights," Nowak said. "So, to give every individual victim of major human rights violations, the right to a remedy before an international human rights court."

Nowak says the court could also decide on legally binding reparations for the victims.

The eminent persons acknowledge it may take 10 years for the court to become reality. But, they note the only way to have true justice and to protect human rights is to have independent judges that are not susceptible to corruption.

First man caught red-handed detained in San Pedro to face new allegation
By the A.M. Costa Rica staff

The first individual brought before a new court for those caught red-handed has been caught again.

The man was identified by the last names of Esquivel Soto. Fuerza Pública officers said he was 21.

The man and a girlfriend were detained in Barrio Granja in San Pedro de Montes de Oca Saturday night. The girlfriend
was identified by the last names of Piran Cortés. She is 20.

Esquivel was detained earlier and became the first person to appear before the special court, which gave him conditional release for two years and eight months with the stipulation that he would work in an educational center. He had been detained for selling drugs.

The arrest followed a string of car breakins that took place in the southern area of the community.

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San José, Costa Rica, Monday, Dec. 8, 2008, Vol. 8, No. 243

A.M. Costa Rica

users guide

This is a brief users guide to A.M. Costa Rica.

Old pages

Each day someone complains via e-mail that the newspages are from yesterday or the day before. A.M. Costa Rica staffers check every page and every link when the newspaper is made available at 2 a.m. each week day.

So the problem is with the browser in each reader's computer. Particularly when the connection with the  server is slow, a computer will look to the latest page in its internal memory and serve up that page.

Readers should refresh the page and, if necessary, dump the cache of their computer, if this problem persists. Readers in Costa Rica have this problem frequently because the local Internet provider has continual problems.


The A.M. Costa Rica search page has a list of all previous editions by date and a space to search for specific words and phrases. The search will return links to archived pages.


A typical edition will consist of a front page and four other newspages. Each of these pages can be reached by links near the top and bottom of the pages.


Five classified pages are updated daily. Employment listings are free, as are listings for accommodations wanted, articles for sale and articles wanted. The tourism page and the real estate sales and real estate rentals are updated daily.

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A.M. Costa Rica makes its monthly statistics available to advertisers and readers. It is HERE! 

Contacting us

Both the main telephone number and the editor's e-mail address are listed on the front page near the date.

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drug dog at work
Ministerio de Gobernación, Policía
y Seguridad Pública/Guillermo Solano

Romeo singled out this man during a sweep in Cartago

Even the dog went along
on weekend police raids

By the A.M. Costa Rica staff

Law officers from several agencies including the Policía Turística conducted sweeps in Cartago and San Carlos over the weekend.

In Cartago a drug-sniffing dog located packages of suspected cocaine hidden in a man's pants. The dog was Romeo, who has been trained especially for these types of sweeps.

The Cartago efforts were Friday night and early Saturday in the barrios of Los Ángeles, El Carmen and Cocorí, said police.

Saturday night the police were in Ciudad Quesada and the tourist town of La Fortuna. Participating were the Policía Turística, the municipal police, the Fuerza Pública and Policía de Migración. The targets were night clubs and bars that had been subject to earlier investigations. A number of undocumented individuals were located, officers said.

Hunt on for seasonal fireworks

By the A.M. Costa Rica staff

Fuerza Pública officers are on the lookout for illegal fireworks, which are a tradition during the holiday season. Officers made a handful of arrests over the weekend and warned the citizenry that those transporting and selling fireworks can face from three to seven years in prison.

Jo Stuart
Real Estate
About us
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