Saturday, December 12, 2009
Dear Reader,
Last Saturday, we started our Overseas Residency series, with the latest information on residency requirements in some of the countries we know are popular with many of you as second-home destinations.
We wrote about Belize, and a residency program that is under threat. The Qualified Retired Persons (QRP) program currently offers a range of benefits, including exemption from capital gains tax and import taxes on household goods.
The QRP program is under review, and may be significantly limited or even eliminated in the New Year.
Today’s residency update is on Costa Rica. Here, there is no uncertainty. The new immigration law published in September this year will come into effect on March 1, 2010. One difference will be the amount of income you’ll need to prove for residency. For the pensionado (retiree) visa, the monthly income requirement will increase from $600 a month to $1000 a month, for example.
Read attorney Rick Philps’ summary of the four main categories of residency in Costa Rica below, and the changes in the new law. Rick practised law in Canada until 1998, before moving to Costa Rica and becoming a member of the Costa Rican Bar association. If you have any questions, feel free to contact him at (JavaScript must be enabled to view this email address).
Margaret Summerfield
The Four Basic Categories for Costa Rica Residency
For Costa Rica residency, there are four basic initial categories. The application for each category must be submitted through the Costa Rica Consulate nearest to where the applicant resides, in their country of origin.
The application process for the ‘Pensionado” and ‘Rentista’ Residency categories is very straightforward, requiring minimal supporting documentation (a birth certificate, a criminal records search, a complete current passport copy, and a financial responsibility letter). The financial responsibility letter should show an income of US$600 per month for the Pensionado, from a recognized pension source, and US$1,000 per month for a minimum of five years, from a recognized financial institution, for the Rentista. All of these documents must be properly certified by a notary, and authenticated by the Costa Rica Consul, in the applicant’s home country.
Applicants must also register with the embassy of their home country in Costa Rica.
The Rentista category requires an additional US$1,000 per month for a spouse, and US$500 per month for each minor child under the age of eighteen. One of the most effective ways to meet the Rentista financial responsibility requirement is for the applicant to deposit US$60,000 into a Costa Rican bank account. In return, the bank will issue the required letter of financial responsibility.
You can withdraw money at the rate of US$1,000 per month, or US$12,000 annually from the deposited funds, over the five-year deposit period. You can also deposit additional funds, to meet the spousal and minor child financial responsibility requirements.
The ‘lnversionista’ and ‘Entreprenurial’ Residency categories are much more complicated, requiring significant investment capital (which varies according to the nature of the undertaking) and government approval. You’ll have to provide a lot of additional documentation, including accounting support, business plans, etc.
Immigration authorities are much more discretionary in their approval of these latter two categories, and for that reason, we advise applicants to avoid these categories, if they qualify for either the ‘Pensionado’ or the ‘Rentista’ categories. The Pensionado and Rentista categories have simpler application processes, with a much greater likelihood of success.
A party in the ‘Rentista’ or ‘Pensionado’ category cannot work as an employee in Costa Rica. You can manage your own business through a Costa Rican corporation, however.
You can apply for ‘Permanent’ Costa Rica residency status if you have maintained any of the foregoing Residency categories, for a period of not less than three years, or you are married to a Costa Rican.
On September 1, 2009, a new immigration law was published, which will come into effect on March 1, 2010. The current law will apply to applications submitted before this date. The new law substantially changes the financial responsibility requirements for the two temporary residency categories, the Pensionado and the Rentista.
The supporting documentary requirements remain substantially unchanged, except for a new requirement that all residents must register with, and pay into, Costa Rica’s government Social Security Health Insurance program.
For the Pensionado category, the minimum monthly pension income requirement will rise to US$1,000 (which includes both a single applicant, or a married couple). The Rentista monthly income financial requirement will rise to a minimum of US$2,500 (which includes a single applicant, a married applicant, or an applicant including their immediate dependents, such as minor children).
The financial responsibility requirement for the Rentista category can be met by pledging a sum of US$150,000 with a recognized bank for a period of five years. The bank in return will provide the required document to meet the application requirements.
For more details, contact me at (JavaScript must be enabled to view this email address).
Rick Philps
Editor’s Note: For details on the Belize Qualified Retired Persons program, click here.
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A Benefit-Packed Overseas Residency
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