If You've been a Victim of Bureaucracy, you'll appreciate this!

For anyone that has ever tried to open a phone line account, electrical account, register a property at the muni, sign up for insurance and the worst: Open a Bank Account.....you will see that you are not alone! Enjoy this video.....depicting someone who's had enough and came in well prepared!

New Annual Tax on Corporations

All corporations, branches of foreign companies and limited liability companies must pay in January of each year this tax based on the following parameters: active companies (those conducting a commercial activity) must pay 50% of the base salary (¢158,100 or approximately $300); inactive companies must pay 25% of the base salary (¢79,050 or approximately $150).

Most property owners typically place their property under the name of a corporation and often a vehicle under a different corporation.  Often, in such cases, these are inactive corporations, which would be responsible for paying the $150 annual fee.

When a company is constituted, the tax must be paid proportionally to the time remaining between the date in which the public deed is filed at the Public Registry and the end of the year.

The approved bill grants a period of three months from the date in which the law is in force to dissolve and liquidate the company without paying this tax.

GREEN Management offers a service who can assist you in the payment of this tax or in the process of dissolving and liquidating the company if you require such services.

Local Protests as Hotels Shut Down and Set for Demolition

Republished with permission from the A.M. Costa Rica staff

Police who responded to open up the Caribbean highway Tuesday met firebombs, rocks and burning tires at four locations. The Fuerza Pública said that 10 persons had been arrested.

The protest began Monday night on Ruta 36 and was triggered by expectations of efforts to evict those in residence at two hotels in Refugio Nacional de Vida Silvestre Gandoca. One is the Hotel Las Palmas, operated by Complejo Turístico Punta Uva S.A. The other is the adjacent Hotel Suerre.

The Hotel Las Palmas, operated by Jan Kalina, has been fighting the government since 1993, and Tuesday was the second time that he was evicted from the premises. The government has alleged substantial environmental damage as well as the fact that the hotel is in the national refuge.

The hotel complex is about three kilometers from Punta Uva. The well-manicured grounds of the hotel included extensive beach. Many improvements had been made by the hotel operator.

Many in the crowds that maintained the blockades are residents of the Caribbean who have property in the maritime zone. Many of the homes there predate the maritime zone law that makes their dwelling illegal. They fear that they will be next with the evictions. But they also were fortified by criminal elements that came from Limón Centro.

The burning tires sent columns of smoke into the air. Police used tear gas. The Instituto Costarricense de Turismo said it provided help for tourists who were evicted from the Las Palmas and others in the area who were delayed by the blockades. The institute did not give a number. Traffic was backed up two kilometers, police said.

The tourism institute said it set up tents with bilingual attendants to help tourists.

Blockades were in Hone Creek and near Cahuita, said police.

The Las Palmas case appears to have touched about every court in the land from the Tribunal Contencioso Administrativo y Civil de Hacienda to the Sala IV constitutional court.

It was the Sala IV that froze government efforts in October 2005 to evict Kalina and his staff. At that time the then-minister of environment, Carlos Manuel Rodríguez, said that the hotel would be turned over to the tourism institute for a national tourism school. The luxurious hotel is some 1,500 square meters of structures.

Kalina was back in the hotel shortly thereafter, and the tourism school idea was not mentioned again. Park rangers occupied the hotel Tuesday. It will be demolished.

The order of eviction that was executed Tuesday was signed Oct. 13, 2009. It survived appeals.

The main concerns were environmental damage done when the hotel was constructed, the illegal cutting of trees, building in the public zone of the maritime strip, building drainage to affect wetlands, blocking ditches and destructions of coral.

In addition to the Fuerza Pública and the Unidad de Intervención Policial riot squad, a number of government agencies were involved, including the Cuerpo de Bomberos. About 140 persons were believed involved in the blockades. Officials were quick to note that the evictions from the hotel had nothing to do with the cases of the long-time residents in the maritime zone in Puerto Viejo and Cahuita. These, too, are complex cases.

Web page easily calculates exiting employee’s pay

written by Garland Baker 
Most expats in Costa Rica have experienced the problem of firing an employee or have one leave unexpectedly. One of the biggest headaches is calculating what is owed to them.

What usually happens is the employee goes to the labor ministry and has the calculations made there. An employer never knows if the numbers are right or wrong. Since many employees exaggerate the truth, the amounts sometimes end up in the stratosphere.

Here is a secret for expats to get a handle on employee severance pay.

First a note: An employee’s pay off varies based on years worked. The more an employee has worked, the more they get in cesantía. This is equivalent to severance benefits. Every employee is entitled to them, if they do their job in a satisfactory manner. The amount an employee is entitled to in vacation pay also varies with time.

Expats usually cringe when they have to make these calculations or call a lawyer to do it for them. Believe it or not, most lawyers do not calculate the amounts correctly either.

The savior is on the Internet located here.

This Web page takes the pain out of employer-employee separation. There is some information on the Web site that is in English, but not the severance calculations, so here is a quick course to use this valuable resource. The process is simple, so just follow this example for an employee:

Go to the Web site. Several boxes are on the page to fill in. They are in groups, the first group is called Tiempo laborado or “time worked.” Type in the date in the box labeled Ingreso. This is the employee’s start date. One can use the calendar, but it may not work on some browsers. If not, be sure to input the date as it is represented in Costa Rican format. For example, the day after Christmas two years ago would be represented as 26/12/2009. The dates are in a day/month/year format. Use this date for this example to see if the result at the end is the same as in this example.

The next box is labeled Salida for the termination date. The employee in this example will lose their job at the end of this month so put 30/06/2011 or use the calendar.

The next group is called Tipo de pago or “type of payment.” There are only two boxes, one is labeled Mensual for “monthly” and the other Semanal for “weekly.” Monthly includes monthly and bi-monthly payments. Weekly includes payments by the week, day or hour. For this example, check monthly.

The next grouping is named ¿Le ha sido otorgado el preaviso en tiempo? This means “Was the worker given notice of termination.” The answer is either SI or NO or Parcialmente for some notice was given. If the latter is the case, put in the number of days the employee was given to look for another job before termination. For this example, check no.

The last group on this page is labeled Días de vacaciones por disfrutar. This means, “How many vacation days does the worker have coming.” For this example, use five.

On the right side of the page — on the top and on the bottom of the calculations tables — in small letters are arrows with the word Siguiente. This means “next.” Click one of the arrows.

On this page there are 12 boxes to fill in. These boxes represent the last twelve months of a workers monthly payments. Fill in the boxes with the correct amounts.

Any in-kind benefits should be included in this amount. In-kind benefits include housing, food, or anything else that fits this definition: Payments for goods or services in lieu of money for labor. The domestic worker in this example is provided lunch by the employer worth 20,000 colons a month. For this example, fill in the boxes with the number 155,000 colons, 135,000 – this is a bit more than what a domestic employee earns according to the labor law – and add the 20,000 of in-kind benefits – their lunch.

Again, on the right side of the page – on the top and on the bottom of the calculations tables — in small letters are arrows with the word Resultado. This means “results,” click one of the arrows.

On the page, the employee is presented the amount of what is called liquidación. To pay off the employee in this example would cost 472,750.00 colons. At today’s exchange rate that would translate into $945.50.

Having employees tends to be a pain. In Costa Rica — as in other parts of the world – the employees are really the bosses of the employers. Going to labor court is expensive, and unless an employer has an iron-clad case they will most probably lose.

The best advice is to have a good labor contract, give written reprimands when they are needed – but no more than two, the third is to terminate. Most importantly, and something most people, not even lawyers know, is an employer only has 30 days to act on any fault of an employee, otherwise, the fault expires.

When one needs to end an employment relationship, this handy calculator is easy to use and very accurate and very few people even know it exists.

written by Garland Baker  on June 6 2011 and published by amcostarica.com
Reposted on this blog with permission from both sources. 

New Satellite Maps for most of the Area - THANKS GOOGLE

Great News...if you enjoy visiting or getting a good idea of what is here from up above, Google has just very recently updated their satellite imagery for most of the Southern Caribbean.

Previous images were all from 2004, and the new ones were snapped in mid 2010.

There certainly are a  few more roofs then before, but also in many cases, more trees.  The imagery is on the dark side, but visible.  Areas of clear development as compared to the 2004 images of before are the Margarita Road, town of Playa Chiquita, Cocles and the Paraiso road.   Puerto Viejo and Cahuita photos have not been updated.

We have inserted the live map below for a quick view, so you don't need Google Earth to navigate.

Enjoy the flight!



View Larger Map

Investor Residency Status – Guidelines and Procedures Explained

"Can I Get Residency if I Invest in Residential Real Estate?"   The answer looks like it may be a YES!

reprinted with permission from Lic Roger Petersen

The Costa Rican Immigration Law which was passed in March of 2010 created the immigration category of Investor.   However the law lacked any guidance or direction regarding the type of investment required to qualify for this residency category.    As such the most asked question we would receive was related to the purchase of real estate in Costa Rica and if that purchase would qualify the Buyer for investor status.   Our answer was always  “maybe”.  The reason for that was that there were no clear guidelines issued by Immigration.    This is about to change.   On January 28th, 2011 the Department of Immigration published 366 pages of the proposed Regulations to the Immigration Law.  Once the Public Comment period is over these regulations should become official and then implemented internally within the Department of Immigration.  

These new regulations provide guidelines and requirements that must be met for those purchasing property or investing in Costa Rica that want to apply for investor status.   The exact wording of the regulation which is Article 63 states that:

“The applicant for the temporary residency category of investor must present an investment project of at least two hundred thousand dollars [US$200,000].  The investment can be in real estate, stock shares, negotiable instruments, productive projects or projects that are in the national interest. “

The Regulations specify the documentation that will be required to prove the investment.  The applicant must provide a detailed description of the investment that is being made.   If the investment is made in real estate then the applicant must present a certificate of title issued by the National Registry of the property that will be the basis for the application. The regulations also require the applicant, once approved, to register the investment with the Costa Rican Department of Revenue before they will be allowed to renew the status. The residency status must be renewed every two years.  However, the law allows an applicant to change status from Temporary to Permanent Residency after three years. As such you should be able to renew once and then before the next renewal apply for a change of status to permanent residency.    Now here is the catch.   The property taxes for the home will be based on the registered value of $200,000 or more if the recorded value is higher which may in turn also subject the property to imposition of the Luxury Home Tax which has a threshold of $175,000. 

If the application is based upon a project then the applicant must file a feasibility study of the project along with the following documentation:

(1) Certification issued by the Costa Rican Social Security Administration (CCSS) indicating that the applicant or their local company is registered with the Social Security Administration.  This has been a common theme since the introduction of the new immigration law in March of 2010.   The government has mandated that all foreigners that have residency in Costa Rica register and contribute to the Social Security system and failure to do so could result in the rejection of the renewal of the immigration status.

(2)  For certain types of projects the regulations will require proof that the project has complied with all permits and requirements such as local municipal permits as well as environmental impact statements as may be required by applicable law. Likewise, for certain projects the applicant may have to demonstrate that they have a workers’ compensation policy in place.  

(3)  If the project is being carried out by a local corporation then the applicant will have to include a certificate of standing and a certified copy of the articles of incorporation.

In addition to documentation supporting or documenting the investment that will be made the applicant will also need to provide the following documents.

a.   Application addressed to the Department of Immigration.

b.   Birth certificate of the applicant.  Certified and authenticated.

c.   Police clearance certificate from your country of origin.  Certified and authenticated.

d.   Copy of your entire passport.

e.   Two photographs

f.    Fingerprinting in Costa Rica for background check

g.   Proof of registration with your local Embassy or Consulate in Costa Rica.

h.   Payment of Fees.  $50 application fee and $200 change of status fee if you apply in Costa Rica.

As I pointed out at the beginning these regulations are currently under the Public Comment period and once completed should become official.   For those that are interested in this option you now have a set of guidelines which you can follow to make the application process clearer to follow.   Keep in mind that this category is a discretionary category which means that the Department of Immigration has discretion whether to approve or reject the application.  As such, those interested in this category should ensure that they prepare a well documented application to ensure the approval of the application.

Check out our NEW Surf Report page

We've decided to put up a new page for Surf Reports.  Being a surfer myself, I often find that my friends are not up to date on the current and future conditions, so we've decided to put up page with 2 active links to actual surf reports for the area. 

CARIBE SUR Surf Report

It is also very helpful to note that surf reports are a highly accurate tool to determine weather patterns.  If a strong swell is on it's way...odds are high that a rain system is behind it.  When the National Weather service, IMN, tells us it will be sunny in 3 days, the surf forecast often tells  a different story - and in my experience, the surf forecast much much more accurate!

The page also includes a few local surfing pics as well as descriptions of the popular surf spots.  We didn't put them all up - as it is best that you discover the less well known but sometimes better surf spots...reserved to the locals...for now at least ;-)

HAPPY SURFING!

CARIBE SUR Surf Report