Break out the party hats, digital nomads it looks like Costa Rica is finally ready to roll out the red carpet for you. A bill creating a new, one-year visa for remote workers (aka “digital nomads”) in Costa Rica was approved last year.
Then came 10 months of squabbling among government ministries about how to implement it. But on July 4, 2022, the recently inaugurated President Rodrigo Chaves signed into law new, streamlined regulations to implement the bill, promising that this time the details have all been worked out.
“The process is very fast, the approval is very fast,” said Marcela Gurdian, the lead attorney at the Immigration Experts law firm. “And these people will be legal in Costa Rica, they won’t have to be leaving every three months. That’s a big advantage, and there are muchísimos digital nomads in Costa Rica today who are now going to be legal.”
Here are the broad outlines of the law:
- Costa Rica is creating a new, one-year visa category for “digital nomads” foreigners who make at least $3,000 a month ($4,000 for families) from other countries by doing remote work from Costa Rica.
- This visa is unusual because it’s good for only one year, though it can be renewed for a second year. (To renew the visa, you have to prove that you have stayed in Costa Rica for consecutive 180 days.) Temporary residency normally lasts two years, followed by a process where you can apply for permanent residency.
- The visa is also unusual because it does not require an apostilled copy of your criminal record or birth certificate from your home country.
- Yet the qualifications are challenging, requiring proof of $3,000 a month in income for the past year, or $4,000 if you’re accompanied by any family member. Many digital nomads are freelancers or contractors, and they can’t easily provide a year’s worth of pay stubs. But the law also applies to remote workers with full-time employment overseas.
- The law requires candidates to have a year of prepaid health insurance, which probably few self-employed digital workers have. Full-time employees of foreign companies may have good health insurance, but not necessarily prepaid for a full year.
- Any application documents submitted in a language other than English have to be translated by an official translator.
- Various costs are associated with the application in the form of fees payable to the government, not counting the applicant’s legal, accounting, and translation fees.
On the brighter side, the new law removes a lot of regulations that strangled the previous law.
“The unnecessary regulations destroyed its value,” said President Chaves at the signing ceremony. He said his administration had accomplished in three weeks what President Carlos Alvarado couldn’t in 10 months.
Among the benefits of this new visa:
- Officials were initially saying that it could be approved in two weeks through an online application process, though they now seem to be dialing back on a promise of such speedy results. The process of applying for temporary residency in Costa Rica normally takes years.
- Candidates will be exempt from paying local income taxes on any revenue they generate from overseas while working in Costa Rica.
- Applicants will be exempt from paying duties on high-tech equipment they bring into the country for work purposes.
- Among the requirements eliminated by the new law is two years’ proof of future income and face-to-face meetings with immigration officials for approval. (However, those who obtain the visa have three months to obtain a “migratory accreditation document,” which may require an in-person meeting with an immigration officer in Costa Rica.)
- A clause requiring applicants to have an official Costa Rican “digital signature” (very complicated for foreigners to obtain) was scrapped.
So What Does This Mean to Me?
The biggest advantage of applying for any kind of residency in Costa Rica is that you’re no longer required to make a “border run” to another country every 90 days. For many ex-pats in Guanacaste, this ritual involves some six hours of driving for a one-hour visit to the Nicaraguan border every three months to get a new visa.
But there are other ways to solve this problem. If you simply apply for “normal” residency, you should receive an expedient, a document that exempts you from having to leave the country every 90 days. Or if you do leave the country, it usually exempts you from needing an exit ticket to get back in.
Note that we’re not talking about having your residency approved this should happen as soon as you even apply. So the main benefit of the digital nomad visa (no need for more border runs), is already covered by the normal residency application process.
But there’s one big problem with the experience: It doesn’t apply to driving. You can drive in Costa Rica with a driver’s license from your home country, but to drive legally you have to make the 90-day border run even if you have experience.
The digital nomad law addresses this issue by saying that applicants’ driver’s licenses from their home countries “will be valid for driving in Costa Rica.” But Guardian said this clause could be controversial because transit laws do not allow anyone to drive for more than 90 days without a new visa. She said we may need to wait to see how this is enforced and whether the conflict in the laws is tested in court.
You could call this “Residency Lite.” It lasts only half as long as the normal version, but it’s easier to get, provided you meet the qualifications.
The law specifies that the one-year digital nomad visa is renewable only once, giving you a maximum of two years in Costa Rica. After that, if you want to stay, you need to initiate a new process to seek permanent residency.
“It’s a temporary permit, it’s not residency,” Gurdian said. “After two years, you need a new plan to apply for residency: investment, pension, income, have your own business. Those two years of permission aren’t worth anything. You’d have to start the residency process from zero.”
If you expect your stay in Costa Rica to be somewhat brief, the digital nomad option might be a good choice for you. But if you want to stay here for five years, you would be better off following a more traditional path to residency.
Almost all these paths require you to prove that you have a certain amount of money. There have long been categories for inversionistas (investors), pension-ados (retirees), and dentists (workers), and all of these require proof of income, a monthly pension, or a big deposit in a Costa Rican bank.
The one exception that allows you to gain residency in Costa Rica without proof of income is if you marry your Costa Rican sweetheart or have a baby here. We don’t recommend rushing into this, but sometimes desperate times call for passionate measures.
When all the wrinkles of the digital nomad visa law have been ironed out, we would anticipate a lot of interest. Applications for the new visa will be accepted soon at the link Tramite Ya