Costa Rica VAT e-services
Costa Rica introduced Value Added Tax on foreign providers of electronic and digital services on 1 July 2019. This was at the same time as Sales Tax was replaced by VAT.
The scope of the tax includes income from: downloads or streaming media; app's; e-books; online journals; software services; online gambling; dating and similar membership sites; and telecommunication services.
VAT must be collected by financial intermediaries - payment providers - including credit and debit card issuers. They are responsible for identifying liable payments by their cardholders and calculating withholding VAT. The financial intermediary will then make monthly payments to the tax office of VAT collected.
Voluntary provider registration
Non-resident providers may still register voluntarily and submit quarterly VAT returns. Registrations are by email. In this case, financial intermediaries would not be required to withhold any VAT. There would be no scope for reclaiming input VAT suffered by the provider.
Costa Rican VAT Compliance
VAT returns must be completed monthly for Costa Rica registered taxpayers. Non-resident providers are not required to comply with the Costa Rican e-invoice obligations.
VAT is due on both B2C and B2B transactions, with no provision for use of the reverse charge on business supplies.