Understanding Tax Form D195

In the realm of Costa Rican corporate compliance, staying abreast of regulatory updates is crucial. One such recent development is the revised version of Tax Form D195, mandated by the Ministerio de Hacienda (Tax Authority of Costa Rica).

This form targets inactive corporations in the country, aiming to collect vital information about their assets. Understanding the intricacies of this form is essential for corporate entities to fulfill their fiscal obligations efficiently.

Why is this form required?

The rationale behind the requirement of Tax Form D195 lies in the necessity for comprehensive data collection regarding the assets and obligations of inactive corporations.

As per regulations outlined in Article 4, all legally constituted and registered inactive legal entities in the Unique Tax Registry (RUT) are mandated to submit this declaration annually by April 30th.

The declaration encapsulates a summary of the entity’s assets and obligations for the preceding fiscal year, spanning from January 1st to December 31st. This regulatory mandate is rooted in the Income Tax Law, particularly Law n°7092 of May 19, 1988, and its subsequent amendments.

To facilitate compliance, the Tax Authority provides a specific form, namely the ‘Informative Declaration of Inactive Legal Entities D-195’, accessible through the Virtual Tax Administration (ATV) platform on its official website. The required information for submission is delineated in Annex 1 of the resolution, ensuring clarity and uniformity in reporting.

Deadline and Exemptions

The deadline for filing Tax Form D195 for the fiscal year of 2023 was, for example, April 30th, 2024. Entities must adhere to this deadline to avoid any penalties or repercussions for non-compliance. However, it’s noteworthy that certain exemptions exist.

For inactive corporations that have fulfilled their obligations by submitting corresponding declarations for the 2020, 2021, and 2022 periods using the simplified form D101 for income tax purposes, the requirement to submit a new declaration using the specific form D195 is waived.

This exemption streamlines the process for entities that have already adhered to their reporting obligations using the simplified format.

Deadline and Exemptions

In conclusion, Tax Form D195 serves as a pivotal tool for regulatory compliance among inactive corporations in Costa Rica. By providing a structured framework for reporting assets and obligations, this form facilitates transparency and accountability within the corporate sector.

Adhering to the filing deadlines and understanding the nuances of exemptions is paramount for entities to navigate the regulatory landscape seamlessly. With the right knowledge and adherence to regulatory mandates, entities can ensure compliance while focusing on their core business operations.

We can of course help you with this obligation in the best way you can even imagine! If you need advice to comply with this requirement or have questions about your tax obligations in Costa Rica, contact us for advice. We have extensive experience that supports us.