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Top 7 Reasons to Go Ahead and Get Residency


This article presents the main reasons to consider applying for residency in Costa Rica. Please compare my previous article, located at, which describes five solid reasons to consider NOT getting your residency, at least not right away.

Let’s first assume that you could qualify under one of the categories of investor (inversionista), retiree (pensionado), or legal resident (rentista). For retirees you would need a fixed income of at least $1,000 per month that you can prove; for investors you’d have to show an investment of $200,000 in a local enterprise, which could mean a home to live in or rent out, or any business, or $100,000 in reforestation; and for wanna-be residents, you’d have to show you have $2500 a month income for at least the following two years (Here is a good link that explains the details of the various options:

It is worth noting that you could also apply for residency by having a Costa Rican wife, child or parent. But the last option wouldn’t be easy unless you could convince your mother or father to move here and get naturalized. Moreover, marrying a local woman or having a child here are not exactly easy, cheap or simple options either. As mentioned in the previous article, it would be better to stick with one of the first three tried-and-true alternatives, short of falling madly in love with a Costa Rican.

1. Legal Reasons to Consider Residency

If you intend to stay in Costa Rica for more than six months of the year, then legally you are supposed to seek and gain legal residency status. There is a law so stating. On the other hand, there is no law against being a “perpetual tourist,” and in this country, what is not expressly forbidden by law is allowed. We know many expats who have been living in Costa Rica for years by renewing their tourist visas every three months, with no problems as of yet. The government is understandably reluctant to crack down on tourists, who after all constitute the life blood of the economy here. After all, what’s not to like about folks who bring their hard-earned currency from abroad and spend it all here?

2. Working with Residency

Getting your residency in Costa Rica allows you to work here, assuming you acquire rentista or invesionista status. Although you are allowed to “work passively” without residency status, for those who want to hold a regular job of any sort, or take an active role in the management of their investment, legal residency is technically required. What do we mean by working passively? For example, as a tourist you can buy a home here then put it on the rental market. Or you can start or buy a hotel and act as the owner, hiring and firing, designing, marketing, meeting and greeting the guests, etc. But you cannot work as a waiter in your own hotel. That would be taking a job away from a Costa Rican, rather than providing new jobs. This is true as well in the US, Canada, and many other countries. Imagine a Chinese citizen investing in luxury real estate in California – no green card required! Such an investor is welcome to buy, passively manage their property, and keep the money when or if they make any, either via a resale or the rental of rooms in the case of a hotel. One final note: when we speak of “passive” work or management, we mean from a legal point of view. As anyone who has ever bought and managed a hotel (as an owner) would know, there is nothing “passive” about all the work that is required. Rather, the point is that as an owner, that person would not have a defined job with a salary.

3. Other Benefits of Residency

Getting your residency in Costa Rica allows you many benefits, to wit: you can (must) sign up for the Social Security insurance, which affords you cheap and comprehensive medical coverage regardless of pre-existing conditions; you can borrow money from the banks; you can get property and other insurance policies in your own name rather than in the name of a corporation; you can get permits to own and conceal-carry up to three handguns or rifles; you can never be extradited to a foreign country against your will (although we hope if you move here it is not because you are an international fugitive!); you can get all kinds of discounts that are afforded only to citizens and legal residents; you can get your parents and dependent children residency  once your own application is formalized; at cocktail parties you get great bragging rights as a citizen of the world; and finally, you will no longer have to leave the country every three months to renew your tourist visa, a benefit which commences the day you turn in your residency application.

4. Taxation and Residency

If you are an American, as a resident you get to write off on your US taxes any earned income derived from Costa Rica, up to approximately $90,000 per year.  And if you work in Costa Rica as a resident, you can (and must)  file your taxes here.  Thankfully, there are no capital gains taxes here.

5. Citizenship and Residency

As a resident you will be on a path to Costa Rican citizenship, if you so desire. First, you will be a temporary resident, then after five years you will be automatically eligible to become a Costa Rican citizen. The even better news is that you can also keep your original citizenship!

6. Intangible Reason for Residency

Another reason to get residency is similar to the reason told in the old joke about why the hound dog lies in the driveway and lick his privates?  Answer: because he can.  If you CAN get your residency here, because you legally qualify, then you are in a privileged and tiny minority of the world’s population.  With the way things are going in many parts of the globe, this is a very good reason to be thankful if Costa Rica is willing to embrace you and your family as one of its own.

7. Safe Harbor as Resident of Costa Rica

Costa Rica has no natural enemies.  Army-less, and lacking in any ambition to take over its neighbors, let alone the world, Costa Rica is famous as a natural safe haven, in all the ways that count.  Over 94% of the electricity here comes from hydroelectric plants, and hence is totally renewable; oil drilling and fracking are officially banned, even though studies found there is oil here; green cover has doubled nationwide in the last 20 years;  and, last but not least, the country boasts a really really good soccer team that is the envy of the soccer world!