Immigration for Entrepreneurs
[vc_row][vc_column][vc_column_text]Some immigration categories are widely unknown for most folks. Mostly, people focus in just a few categories such as the marriage, parent, pensionado, rentista and investor while there are over thirty different categories available. Naturally,
Some immigration categories are widely unknown for most folks. Mostly, people focus in just a few categories such as the marriage, parent, pensionado, rentista and investor while there are over thirty different categories available. Naturally, these categories are very popular because most the information that you find on line is about them. The lay person does not go about reading the immigration law to figure out what is available. Certainly, average folks would not read the law because there is only one type of person fond of reading laws, and those are attorneys.
So, there are a couple of categories that I think are underused. I think a lot of expats who currently live in Cosa Rica could take advantage of these options.
Temporary Residency for Self Employed Skilled Worker
The name is very self-explanatory. This category is available for people who are self-employed and possess some sort of skill. Regarding the skill, the law means any sort of skill the person has acquired either through education or experience. Any kind of professional who has graduated from college or technical school can qualify for this category, as well of people who are experts in any given industry regardless of whether they went to school or not.
Update November 20, 2018
Costa Rica´s Labour Department has issued a resolution suggesting Immigration refrains from approving certain Temporary Residencies under the Self-Employed Category. This to protect local workforce.
Issuing a list of non-accepted professions is a yearly occurrence. The Ministry issues a list of professions that will not be approved early in the year and reviews it by the end. Furthermore, considering that unemployment is expected to rise after the covid crisis, it is also to be expected that this list will remain in place or even grow.
If interested in filing under the Self Employed Category, Outlier Legal will review your case and will surely do everything to assist, aiming for a positive resolution. Nonetheless, it is important to raise the alert.
People who have obtained a degree from a university will qualify for this category. There are some professions that require obtaining a license, such as attorneys, accountants, physicians, psychologists, so on and so forth. People in these fields are eligible for residency, however, they need to obtain the license from the corresponding professional association, which are called Colegios Profesionales.
People applying for this type of residency must complete the licensing simultaneously with the immigration process. There is a catch 22, the immigration department is not going to grant residency unless the person has the license, and the Professional Association is not going to grant the license unless the person has residency. However, most of the Professional Associations will grant a provisional license and will issue the permanent license upon completion of the immigration process. This provisional license will allow the immigration department to issue the approval for the residency.
There are other professions which do not require a license such as web developers, marketing consultants, graphic designers, writers, so on and so forth. People in these fields, the main requirement is to produce the college diploma (along with all other regular requirements). The college diploma must be translated and apostilled to be admissible for the immigration department.
Some of these professions do not necessarily require going to school to learn the skill. Some people are self-taught and could learn (whether it is programming, design, photography) on their own terms. For this type of people, it is still possible to obtain this category of residency. Instead of producing a college diploma they will have to produce an affidavit and evidence to demonstrate they possess the skill, such as a portfolio of projects completed. The most extreme case we had was for a florist who had ten years of experience being a florist. We could comply with the main requirement by producing an affidavit and portfolio of projects.
Another specific requirement is to get registered to pay taxes. While expats with only a tourist visa can get a Tax ID, it is advisable to get a company registered. For this type of professionals who are self-employed, the right legal structure for a business is an EIRL (Individual Limited Liability Company) which is basically an LLC for one person. Under Costa Rican law, LLCs (or Sociedad de Responsabilidad Limitada S.R.L.) require at least two partners to be created, and corporations (or Sociedad Anonina S.A.) require a board of directors with at least three board members. Thus, the most applicable option for people who are self-employed is an EIRL. This legal structure will allow the person to obtain a tax ID and to be able to do contracts and hire services such as power, phone, water, open a bank account, should it be needed.
This category of residency does not require to have a brick and mortar operation, people can work from home. The two main requirements for this category is to have a verifiable skill and to obtain a Tax ID.
There are two important factors to consider for this category: it allows the applicant to include immediate relatives, and it will also allow the applicant to obtain permanent residency after three years, which is not applicable to the special category which we will look at next.
Special Category for Self Employed People with a Registered Business
Unlike the previous category which is applicable to people who have a skill, in this category, the skill does not matter. The main requirement is to have a registered operating business.
This is not the investor category!!!
When I talk about this category, people immediately think of the investor category. So, let me tell you how this is different from the Investor Category:
- You are not required to invest $200,000 USD. In fact, there is no minimum amount of money required to be invested to qualify. If you can open a business with $10,000 USD, that will be fine.
- You are not required to hire ticos. The purpose of the investor category is to create an investment for foreigners to invest in Costa Rica and to open businesses that will be good for the local economy, which includes hiring local workforce for that business. This is not required under the self-employed category, which in turn, creates allows the opportunity for a person with a business to obtain immigration status.
- You can work in your own business and to receive a salary. While the investor category does not allow you to work on your own business and get a paycheck (instead, you should receive dividends), this category allows you to put yourself in payroll and get a paycheck every month.
As you can see, there are great differences between these two categories. While this self-employed category may look advantageous, there are some caveats, such as not being able to obtain permanent residency and not being able to bring other relatives.
For some reason, congress decided that people under this category must do a renewal every year. The main requirement to renew is to confirm that the business is still operating, to that end, the applicant must produce the company documents (licenses, taxes, permits, certificate of good standing, so on and so forth). It is not too cumbersome to produce these documents every year as long as the business is kept in order. And for another obscure reason, this category does not allow to obtain permanent residency, which means that the applicant must keep the business running to be able to remain in the country with valid immigration status. Finally, the most adverse aspect of this category is that it is not possible to obtain this category for the spouse or children. While it may be possible for the spouse to also obtain this category if she/he is part of the business, the children will not be able to acquire this category. Weird.
What does it mean to have a registered business?
Any business can qualify for this category as long as it is a legitimate registered business. Being registered means that it must comply with the following requirements:
- To be incorporated. The regulation does not specifically require you to get legal structure, but is extremely essential to get a company registered in order to operate a business. Once again, if the business is only for one person, it is suggested to get a EIRL, if it is for two people a SRL will work.
- Tax ID. Once the EIRL is registered, the company should obtain a Tax ID with the Revenue Service (DGTD or Dirección General de Tributación Directa).
- Business License from the Municipality. For this category, it is required to have a brick and mortar operation and thus, your company should obtain a business license from the local municipality.
- Health Permit. While the immigration regulations do not directly require you to obtain a health permit, this permit is required to obtain the license from the municipality.
- Zoning Permit. The municipality will also require obtaining a zoning permit (uso de suelo).
- CAJA Registration. Notwithstanding that you can be the only employee in your business, it is required to get registered as an employer with CAJA (the social security system).
- Workers Compensation Insurance. Along with other requirements, you must obtain an insurance policy to protect your employees (including you) in case of an accident at work.
This may look a little overwhelming, but any entrepreneur knows that starting a business is not easy. Whether you are planning on obtaining an immigration category or not, you must comply with a lot of requirements to just open a business.
For immigration purposes, you can qualify for this category whether you already have an existing business or are about to open a new one. Regardless your situation, you must keep in mind that you must comply with all these documents to successfully obtain this category.
- It is possible to obtain this category regardless of the type of business that you have. This is a non-exhaustive list of businesses eligible for this category:
- Shops and stores: such as shoe store, boutique, souvenir shop, or any type of specialty store.
- Restaurants and bars, anything such as coffees shop, taco stand, restaurant, bakery, ice cream shop, pizzeria, so on and so forth.
- Hotels, such as cabinas, hostel, hotel, etc.
- Tour operators. Tour services, tour operators, transportation, booking services.
What category is applicable for me?
Once we had a baker with over ten years of experience and had been operating his bakery at the beach for the past two years. While this person did not attend cooking school, he certainly had a lot of experience and had an operating business. He could qualify for either of the two categories, so we did the temporary residency as he had a wife.
These two categories are not applicable to everyone, each person must take a look at the situation to determine which one is the best option. The best category of the two is the Temporary Residency for Self Employed Skilled Worker. On the one hand, it has fewer requirements, while the other category requires having an operating business which can be burdensome and costly. On the other hand, this category is a temporary residency which allows you to obtain permanent residency after three years as well as to obtain this category for immediate relatives.
If the applicant does not have the possibility to obtain the temporary residency but has a business (or is planning on having one) it will be possible to obtain the special category with the caveat that it will not be possible to obtain permanent residency or to obtain this category for any other relatives.
Below you can find a table comparing the main requirements and benefits of the two categories.
I hope this information to be helpful. Please feel free to reach us with further questions or comments.
Harlon Wilson April 4, 2018
Entrepreneur living in Midwest. Looking to move to CR for permanent residence either on retirement or self employed. Selling US assets in prep for Sept move. Can you help?
rafavalverde April 4, 2018
Thank you for your message. Indeed, we can assist you. We will be sending you an email shortly.
Michael Carden May 23, 2018
I have a job where I can work anywhere in the world if I have internet connection. Was thinking about getting residency there if it’s possible. Not sure if I would qualify
rafavalverde June 7, 2018
Thank you for your message and our apologies for the delayed response.
Regarding your question, indeed you can qualify for either self-employed or rentista. Please review our services page to see the details. https://outlierlegal.com/services/immigration/
James Timmons July 7, 2018
Read this article with interest. My daughter is a 30 year old with a Master’s degree in occupational therapy and 6 years experience in a rehab hospital. She would like to move to Costa Rica, but would need to work. I have been told that this would be impossible, but your article seems to imply otherwise. There has been talk for years of the need to build/staff a retirement home for ex-pats in the Nuevo Arenal region or at least develop a home health physical/occupational therapy business to help ex-pats with rehab needs. Would my daughter, in theory, be able to establish such a business here under one of the categories you have described? I am lead to believe there is adequate need, specifically for treating english speakers in their native language. Would appreciate a brief reply indicating whether it would be worthwhile for her to discuss this with you. Thanks.
rafavalverde September 3, 2018
For people in the medical industry, it is a bit more challenging to obtain residency, as medical and health professionals are required to get licensed by the corresponding professional board.
While it is possible, it is more work intensive and therefore, more costly.
Janiel Stewart July 11, 2018
How can I obtain an temporary residency through self employment
rafavalverde September 3, 2018
You are required to register as a tax payer with the revenue service. Depending on your work, you will be required to produce certifications to attest your specialty or skills.
Feel free to reach us with further questions.
Louis Miliman June 19, 2019
I teach English online and am looking to move to Costa Rica with my wife and 3 kids. What would be the best option for us all to become permanent residents?
rafavalverde June 26, 2019
While there is a category of residency for selfemployed people, currently the Labor Department has suspended approvals for residencies (among other professions) for English Teachers.
Our suggestion is to look for other categories as investor or rentista which you can review following this link https://outlierlegal.com/services/immigration/
Sonia Morant September 14, 2019
Hello! I moved to Costa Rica 1 year ago, my full time job here is as a musician. I perform everywhere, restaurants, parties, company events, you name it. Was wondering if you could help me with the process of starting my own business so I can become a resident. This business does not require land etc because I travel to my shows.
rafavalverde September 15, 2019
Thank you for your comments. Indeed, we can help you with this process. Let us know if it is ok to reach you by email.
Frédéric February 22, 2021
Hello, where can we find the list of the professions permitted? I’m working as a consultant in Information Technology and I have a bachelor in Marketing management. I was wondering if it could qualify me as self-employed entrepreneur. thanks for your feedback
Stacey Jennings February 22, 2021
That is a very difficult category to qualify for at this time – Immigration has limited the approvals in order to protect the local workforce. If you would like to speak with one of our immigration attorney’s we would be happy to assist you in finding other residency categories that you may qualify for. Just let me know if I can put you in touch via email! It would be our pleasure to help you!
Frédéric February 24, 2021
yes you can, you have my email I think
Stacey Jennings February 24, 2021
Thank you – I have forwarded to our immigration team – they will be in touch. We appreciate your patience as we are receiving a larger number of inquiries than normal lately.
Fernand February 23, 2021
Hello all, I was wondering the following: a friend wants to move from Canada to Costa Rica and get the residency. He works from a company that is in Costa Rica too. Is there a possibility he can apply for it if he gets the chance to work for the same company here? Additionally, is it possible to sponsor someone for the time of his stay? Thank you for your help.
Stacey Jennings February 24, 2021
This category is very difficult to qualify for now. It is hard to get to get approvals as they are trying to protect the local work force. It is possible to be sponsored by companies – your friend should contact the one he is working for now and inquire. You cannot personally sponsor someone. If you or your friend would like information on residency we would be more than happy to assist!
Erik L March 1, 2021
I own a tech consulting business (LLC) in the USA. If all of my clients are in the USA and I have the contracts to prove it, will Costa Rica still limit my ability to use the entrepreneur/ self employed visa based on my profession/ industry? I have no intention of earning income from Costa Rica based sources- I merely intend to live in Costa Rica and import my income from the outside.
Stacey Jennings March 1, 2021
Because your income is coming from outside the country you should consider this category https://outlierlegal.com/services/immigration/rentista-category/
andrea February 3, 2023
Hello 😉 My Husband and I are in the process of gathering Canadian Documents to apply as Rentistas. My husband has a clear criminal record but I have a recent assault charge that I completed 9 months of probation for as my only requirement. Would I be automatically disqualified to apply as I do infact have a criminal record? I was charged with assault for coughing during covid. Ah, to be a Canadian! Ugh. Any help is much appreciated.
Maripaz Soto Villalobos February 6, 2023
It is not an automatic disqualification, no. The Department of Immigration will likely request a document stating how and when the case was resolved. This court issued document will also need to be authenticated and legalized for use abroad.
For more information, you can contact our Documents Country Manager: Amanda Bolton firstname.lastname@example.org