House and yard in Escazu

How can I get residency in Costa Rica?

In August 2009 the Costa Rican Congress unanimously approved a law overhauling the country's immigration policy. The new law is expected to take effect in early 2010. Below I give both the old and the new requirements for getting residency.

Types of Residency

There are countless types of Costa Rican residency, but for the purposes of the average North American or European,three of these will be of interest:

Pensionado (pensioner/retiree)

Rentista (the category has nothing to do with whether you rent or buy your home, and can be loosely translated as "small investor")

Inversionista (large investor).

The three categories mentioned above allow you to, after two years, apply for permanent residency.

Another option is to continue to renew, and renew again, your three-month visa. See Life as a perpetual tourist.

Pensionado (pensioner/retiree)

Most retired people opt for this category, which requires you to prove at least $600 a month in pension income (You'll need to prove $1000 in pension income when the new law goes into effect next year). The income can come from a public source, like the U.S. government, or a private source, like the brokerage house that administers your IRA account. You must document that you will be receiving at least $7,500 ($12,000 with the new law) a year, and arrange to have the checks deposited to a Costa Rican account, which will be in colones, not dollars. For a married couple, the spouse with less (or no) retirement income is considered a dependent, and a dependent need show no proof of income.

Pensionados need to spend at least four months in the country a year, though the time need not be contiguous—you could spend January, February, October, and November here, for instance. You can’t work as an employee, but you can own and receive income from a business.

Rentista (small investor)

For those who have not yet reached retirement age but have managed to make investments that bring in regular income, the rentista option is an attractive one. You’ll need to prove a monthly income of $1000 (usually a CD or annuity), guaranteed by a banking institution. If, after two years of rentista status, you apply for and receive permanent residency, you can withdraw all the money out of the account. (When the new law goes into effect next year, you'll need to prove a monthly income of $2,500.)

Other details of the rentista category are similar to those of a pensionado: you can own a business but not work as an employee; you need to be in the country for at least four noncontiguous months each year, and dependents, whether spouse or child, enjoy the same immigration status as is awarded to the applicant.

Inversionista (large investor)

Although you can legally own and operate any sort of business in Costa Rica even if you only have a tourist visa, an investment of at least $50,000 in a sector the government deems a priority will get you inversionista temporary resident status. Costa Rican officials have declared as priority businesses related to tourism, forestry, and low-income houses. Non-priority reforestation projects will require a $100,000 investment in order to qualify you for inversionista status, and any other business ventures will call for $200,000 or more. Inversionistas must stay in Costa Rica six months out of every year, though as with other categories of temporary residency, the time need not be contiguous. (The new law may change these amounts as well.)

Life as a perpetual tourist

No paperwork, no job, no muss, no fuss–nice work if you can get it. And it can be that easy, though recent crackdowns have put the fear of expulsion in the hearts of long-term expats who’ve never bothered about renewing visas or getting residency.

A side note: It used to be that people from Canada, the U.S., and Panama could enter and exit Costa Rica without a passport, though they did need some form of identification, like a driver’s license. As of April 30, 2003, however, all visitors to Costa Rica must travel with valid passports with at least three months remaining from the date of entry into Costa Rica.

Here’s how the perpetual tourist thing works. Visitors from Canada, the U.S. and most of Europe don’t need to apply for visas in their home countries but instead receive, upon arrival in Costa Rica, a stamp on their passport authorizing a 90-day stay. (You may need to proove that you have enough money for those 90 days.) When that 90 days is almost up, you leave the country for at least 72 hours–maybe you’ve always wanted the visit the colonial city of Granada in southern Nicaragua, or snorkel at one of the Bocas del Toro islands in northern Panama. After your 3-day vacation, you cross back into Costa Rica, and get another 90-day stamp on your passport. This category of visa is called the B1, or tourist visa.

Some people do this for years, but it’s not an ideal solution. Although not strictly illegal (you’re not overstaying your visa), the practice is considered a little shady by Costa Rican officials–a way of getting around the law.

If you have anything to lose in Costa Rica–a house, a business, a family–this sort of gray-area existence is apt to make you a little bit anxious. Not to mention that leaving the country every three months gets to be tiresome and expensive. Costa Rican officials are becoming more inflexible about enforcing immigration laws. If you get caught with a long-expired visa, you could be deported, and not allowed to return for ten years. And the new law passed in August 2009 and expected to go into effect in early 2010 says that you can be fined $100 for each month you stay beyond your legal limit.