When buying real estate for investment many buyers look overseas and one of the big advantages is normally the generous tax incentives on real estate investment property. How does real estate taxes and no capital gains tax sound? Combine this with fantastic growth potential and you can make money and save tax. Lets look at one market as an example. 1. Low property Tax. Property taxes in Costa Rica are extremely low when compared to say the United States. Property taxes vary from 0.5% to 1.5% of the declared value of the property. The Municipal Tax is administered at the municipal level and varies throughout the country. Paid quarterly, the type of property, location and other factors contribute to the calculation of this tax. 2. No Corporation Tax A great incentive provided by the Government for overseas investment is that there is no capital gains tax. A buyer would not be taxed by the government on the profit from the future sale of the property as long as this is not undertaken as a primary means of business. 3. Legal rights of overseas buyers are protected Ownership of real estate in Costa Rica by foreigners is fully guaranteed by the Government. In addition, foreigners enjoy the same ownership rights as Cost Rican residents, regardless of whether the property is placed in the name of a corporation or in the name of the buyer. The decision to have the property under the name of a corporation is up to the investor. Corporations are very common and can offer benefits of asset protection and anonymity for the actual owner. The cost is approximately $500.00 Costa Rica is looking for overseas investment and its steadily rising with American buyers in particular for the following reasons: Its just a 3 hour direct flight yet property can be up to 70% Living costs are far lower Amenities and infrastructure are good The country is peaceful and beautiful and one of the top adventure tourism spots in the world Capital growth potential is fantastic those buyers who bought near the popular town of Jaco with 30,000 dollars 15 years ago are worth $750,000 today and with investment at record levels further growth is expected Buying is easy, with very little red tape Consider this The baby boomer generation are buying second and retirement homes in record numbers and low taxes, cheap properties, great growth potential and in a safe and stable environment is very appealing. Check out overseas destinations like Costa Rica for yourself and see. |
