Noticias

Tax Bulletin

July 2016

Tax Information

 

Current Base Salary

¢424.200

Current Interest Rate
(March 1st, 2016)

12.92%

Late payment penalty rate
(month or part month)

1%

Reference Exchange rate BCCR
(Jun 1st, 2016)

Buy:

¢541,59

Sell:

¢554,14

Insurance Companies are subject comply with the Common Reporting Standard

In the past few months the application of the Common Reporting Standard (“CRS”) by the Financial Institutions in Costa Rica has been a hot topic for discussion. Financial Institution or FI include Custodial Institution, Depository Institution, Investment Entity or a Specified Insurance Company.

The CRS is a minimum standard for the exchange of financial information between governments (information delivered by the FI). Similar to the Foreign Account Tax Compliance Act (“FATCA”), CRS would require that the Financial Institutions of a partner Jurisdiction implement due diligence processes, documentation and identification of the reportable accounts under the CRS category.

As in FATCA, the Companies that provide Insure Services are also included in CRS.

Every day more companies offer these kind of services, and therefore it is important to take into account the obligations in case the entity is considered as a Specified Insurance Company for FATCA and CRS purposes.

The service lines that are impacted are normally the ones considered as annuity contracts. These are all contracts under which the issuer agrees to make payments for a period of time determined in whole or in part by reference to the life expectancy of one or more individuals. It is of very important that the Companies that offer this kind of services seek advice in order to determine if they are considered as an Annuity Contract in terms of the CRS, and consequently are obligated to implement FATCA and CRS.

José Fabio Chinchilla
Tax & Legal Services

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