Tax treatment for leasing and real estate taxpayers

July 30, 2021

On July 27, 2021, the editorial Delfino.CR displayed what commentator Marco Vargas Siles pointed out, saying: “there is an inequality of tax treatment of taxpayers engaged in properties leasing through digital platforms.

1. Taxpayers of real state rentals

The aforementioned author comments that the tax administration has initiated an inspection campaign on taxpayers registered with the economic activity of rentals, especially the activity 551001 “Rental of real estate for residential use shorter than one month” to verify the compliance with the payment of the tax derived from capital income declared in Form D-125.

Law 9635, Chapter XI, regulated taxpayers whose economic activity is rentals with the possibility of paying tax on profits or capital income if the asset is not subject to a lucrative activity and has a collaborator registered with the Fund.

However, many taxpayers did not perform this procedure, and the tax administration left the duality of obligations, i.e., having to file a D-125 and finally a profit tax return at the end of the period.

3. Failure to comply with obligations

Many taxpayers have filed their profit tax returns and have not paid monthly capital gains tax, resulting in the imposition of penalties and fines.

The commentator pointed out that, apart from the penalties that may be imposed, in essence, inequality is being established between economic agents with similar economic activities.

4. Promotion of rentals under digital platforms

The economic agents registered under the economic activity of temporary rentals, i.e., those who promote their properties under platforms such as AIRBNB, Homeligdays and other similar ones, aim to offer national and international tourists the possibility of staying for short periods of time, being obliged to file a D-125 and pay the capital gains tax.

5. Problems as result

Under the current regulations, these economic agents must pay taxes despite losses, given the difficult world situation.  With the implementation of the Law for the Strengthening of Public Finances, inequality is being created, significantly affecting those people dedicated to this economic activity, a contradiction in terms, intending to reactivate the economy.

Therefore, there is no real rationality in the tax allocation, generating inequalities among taxpayers.

Source: Delfino 30/07/21