Last year, the government announced the Digital Nomad visa option for legally staying past the traditional 90-day visa in Costa Rica. While, in principle, a viable option for those seeking to live and work virtually in Costa Rica for 1 or 2 years without having to do onerous border runs, the program, as initially announced, had flaws. It was left to this recently installed government to finesse the program. They did so by relaxing some of the previous requirements to expand viability. It has now been signed into law by the new president Chaves. Implementation will follow soon.

Details of the program:

Unlike the traditional residency options, the Digital Nomad visa will not provide any switch-over through an application of Change in Category to the Temporary Residency. Those options are separate and apart. IE: Those with a tourist visa can switch to Temporary Residency. Those with a current Temporary Residency can change category application to Permanent Residency after three years of Temporary Residency.

For those unfamiliar or those needing a reminder, here are the most common types of legal ways to remain in Costa Rica:

1. 90-day visa issued upon entry into Costa Rica with a U.S., Canadian, and EU passport, as well as many other countries. Some countries are restricted to 30 days. Others are excluded. Check with your nearest Costa Rican Embassy if unsure about your country of origin.
2. Estancia – Special permit to stay legally in Costa Rica for a year (or more) for people of special relevance in the scientific, professional, religious, cultural, sports, economic or political fields.,
3. Temporary Residency. The first issuance upon approval is for two years, renewable every two years. It comes with certain restrictions, such as not drawing a wage in Costa Rica.
4. Permanent Residency. Applicants can apply for it at the end of year 3 of Temporary Residency—fewer restrictions. Renewable every three years, then after ten years of combined residency, renewed every five years.
5. Refugee status. For those fleeing conflicted countries for political reasons. Costa Rica is committed through an agreement with the UN to “take in” a given number each year. (Which bogs down the entire Department of Immigration and is currently under review to provide relief from the current burdens. An official appeal was launched recently at the UN in New York.)

OK Fine. Then who would this Digital Nomad be of use to?

1. Self-employed people who are free to work virtually online, and those who want to take Costa Rica for a “test drive.”
2. Employed by a company that allows them to work abroad or on assignment in Costa Rica.

All others looking to migrate to Costa Rica should only consider the traditional categories of Pensionado, Rentista, Inversionista, or Vinculo categories of legal residency.

Qualifications for Digital Nomad:

Essentially prove a minimum monthly income of USD 3K/month. USD 4K/month if including spouse and dependents.

The list of the requirements.

A) Applicant Signed Application Form (or by legal representative.)

B) USD 100 application fee.

C) Scan your main passport page with photos and vital info, plus the page containing a current, unexpired entry visa stamp.

D) If originating from a country requiring a consular visa, you must provide a copy of that visa. Check with your nearest Costa Rica consulate or embassy to verify if this applies to you. US, Canada, and EU passports receive automatic entry visas to Costa Rica. Valid for 90 days.

E) Your bank statement that clearly shows a minimum income of USD 3K/month (4k/month for those applying with a spouse and family). The information must be from an accredited financial institution and accompanied by an affidavit.

Documents for the dependent family: (Spouse, common-law partner, children under 25, parents.)

1. Certified copy of a Marriage Certificate no older than six months from the date of issue.
2. Unmarried couples: Common law certificate of a union from an official agency. (Not available in all states or provinces.)
3. Certified Birth Certificate for all dependent children under age 25.
4. Certified health certificate for any dependent with a medical condition necessitating the dependency.
5. Dependent seniors must produce a certified document proving the relationship to the applicant.

Health insurance:

There is no requirement or option to join CAJA (Costa Rica’s universal health program). But applicants must show proof of USD 50,000 worth of medical insurance coverage. While that avoids enrolling in CAJA, which recently almost doubled its premiums, 50K does not go far in Costa Rica’s private hospitals in the case of severe medical episodes. Getting adequate insurance coverage can be cost-prohibitive for many applicants.
Careful thought and mathematical calculations are highly recommended just over this issue alone. Further, those recently increased CAJA premiums are under serious review. I expect they will be brought down in line to more acceptable levels soon. We are keeping a very close eye on this situation. Insider sources are feeding back some positive indications. The president and the Ministry of Tourism are well aware that time is of the essence to correct the current poorly thought-out CAJA program.

Tax Benefits of Digital Nomad:

No income tax will be levied in Costa Rica if the income is generated abroad (not within Costa Rica – IE: invoiced to clients in Costa Rica). You might wish to remember that Costa Rica is a reporting country to the IRS in the U.S. and Revenue Canada through trade agreements.

Given that I have received many emails about tax-free importation of large items like furniture and vehicles to Costa Rica, the Digital Nomad tax exemptions on allowable importations are very limited. They are restricted to minor electronics such as a single computer, tablet, cell phone, camera, or recording equipment. No cars or furniture. (That is another subject to be covered in a subsequent article.)

We expect that in keeping with the new president’s frequent allusions, these more relaxed requirements will soon be extended to the traditional types of legal residencies to simplify things and significantly speed up approvals. Some of the current requirements, such as birth certificates, background checks, apostilles, and border runs to keep foreign driver’s licenses valid, must be vigorously re-examined. (And likely are.) Given that the requirement for a local Interpol background check covers the entire planet, as does a passport when checking through customs, it would seem redundant and obstructive to keep asking for these other documents that are difficult for some to obtain.

Weekly updates from President Chaves indicate that the house cleaning and unclogging of bureaucracies is well underway. Cause for natural optimism. Check out his updates every Wednesday on Channel 13 and YouTube.