Are you ready to expand to Costa Rica? Establishing your business in a new country can be a complicated process. You need to set up payroll, hire the right employees, make sure they’re compensated correctly, and design a competitive benefits plan. This is in addition to adhering to local compliance laws and requirements.
The first step, however, is setting up a Costa Rica subsidiary. Depending on where and how you incorporate, the process can take weeks or months.
How to set up a Costa Rica subsidiary
If you’re wondering how to set up your Costa Rica subsidiary, you need to consider a few different aspects. The setup process can vary based on the region of Costa Rica you incorporate in. Different regions operate under separate regulations as well as cultural influences that could impact your business. Always research the area around your physical office location before establishing your subsidiary.
You also have choices regarding what type of structure you would like to incorporate as. In Costa Rica, the 2 most common entity types are the Sociedad Anónima (SA) and the Sociedad de Responsabilidad Limitada (SRL), which in Costa Rica is the same as what’s commonly referred to as a limited liability company (LLC) in many countries. A SRL offers many benefits for companies looking to grow in Costa Rica.
The process to set up a Costa Rica subsidiary as a SRL includes:
- Registering the company name.
- Submitting a notarized document to the Mercantile Registry and requesting a corporate identification number.
- Registering your Articles of Incorporation.
- Registering the company as a taxpayer and obtaining a taxpayer ID.
- Opening a bank account.
- Publishing an announcement of your formation in La Gaceta, the country’s legal newspaper.
- Obtaining a registered office.
- Appointing at least 2 shareholders and 1 director.
Costa Rica subsidiary laws
Costa Rica’s applicable subsidiary laws depend on what type of entity you choose. For an SRL, you need at least 1 director and 2 shareholders, who can be of any nationality. You will need at least USD 1 of paid-up share capital to complete the incorporation process.
Your SRL also needs a physical address in Costa Rica, where you keep your statutory and accounting records. If none of your directors live in Costa Rica, you’ll need to appoint a registered agent.
Before you can run payroll, you must set up in-country bank accounts through a public or private bank. It’s notoriously difficult to open bank accounts in Costa Rica, so you should prepare for a lengthy process.
Benefits of setting up a Costa Rica subsidiary
With an SRL in Costa Rica, you can protect both the subsidiary and the parent company. The subsidiary can operate freely in Costa Rica, while the parent company has limited liability for the subsidiary’s actions.
However, with G-P, companies can leverage our established subsidiary in Costa Rica to begin operations in a fraction of the time. Instead of spending months setting up your own Costa Rica subsidiary, we can help you start hiring quickly and compliantly with our EOR solution.
Other important considerations
Companies should prepare for incorporation by setting aside the time and money needed to complete the entire process. Work with your accounting department to budget the right amount for all the fees involved in the Costa Rica subsidiary setup process. You may also have to set aside time to travel back and forth to Costa Rica to help streamline the process.
Enter new markets with G-P — no new entities required.
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