Cost of Living in Costa Rica – Part II – Bills & Taxes

Retire in Costa Rica – Cost of Living in Costa Rica – Part II, Bills & Taxes



There’s just no getting away from them!  Even retiring to a tropical paradise still means paying those monthly bills — only the cost of living in Costa Rica is cheaper!  To see what I mean, keep reading to find what, where and how much you’ll probably be paying (saving) to live with all essential services to your Costa Rican home!


Utilities — Unlike Monopoly, They’re Everywhere!

Your electric bill should be much cheaper than what you pay in the USA as there are no central heating costs in Costa Rica and most homes rely on fans to bring down the temperature, rather than costly hvac systems.  The charge per kilowatt is lower too.   If you are building your own home, you might consider installing solar panels as an eco-friendly, cost-saving measure in your construction –- after all, the sunshine is year round and free!


Your water and electricity are measured by meter and checked monthly.   If you are out in the sticks, your water may be supplied by a well.   If that is the case, check with the nice people at ICE (Costa Rican Institute of Electricity – pronounced E-say and not ice) are charging you a concessionary rate for the running of your water pump.  Pay your bills promptly as there are no second chances.  Your essential services will be cut if they are not paid within a few days of the fecha de vencimiento (last date of payment).  You will then have to pay the reconnection fee as well as suffer the inconvenience of telephoning and arranging the appointment, not to mention the fact that you’re now going without water and/or electricity.


Here’s a simple tip, don’t wait for the bill to pay.   It won’t always arrive before the cut-off date if it even arrives at all!  Both ICE and AyA (Costa Rican Institute of Water and Sewage, known as AyA and pronounced Iya) are nationalized institutions –- there is no competition, so you’ll just have to be patient when dealing directly with these companies!


Water:  Expect to pay between $10 and $20 monthly.  Obviously, your water consumption is up to you!  You will pay roughly $0.07 per square foot consumed.


Electricity:  Usually higher than water; however, an average bill with fans, computer, TV and other normal electrical appliances shouldn’t top $30 a month for a couple, unless you are also cooking with electricity or machine drying all your laundry.


Gas:  Most commonly used for cooking, but as Costa Rica is prone to tremors, piped gas is unavailable.  Gas tanks cost about $20 and should last a couple who are cooking nightly for dinner parties around four months.  Your deposit on a tank is $70, but it is well worth the initial expense of putting down a deposit on two, rather than have your meal spoil as you are forced to abandon the kitchen to dash to the store for a replacement tank in the middle of cooking!  Again, here’s where planning ahead can save the day.  Gas is noticeably cheaper to buy in large supermarkets, rather than your local store.


Cable or Satellite Television:  A must for the majority of ex-pats.  Local television is limited to three or four channels of dubious reception, depending on your location.  While local programs are helpful for learning Spanish; English TV is much better for relaxing.  For a Sky package, expect to pay at least $30 and then extra for those additional channels and sporting events.  All your familiar channels are there: Sony, Fox, Disney and movie channels galore!


Telephone:  Land lines have a basic charge of about $4 monthly, but you will need to have residency to have a line in your name (as with water and electricity).  A foreigner can have a phone number on a pre-paid cell phone; however, so this is an option for those still working on papers.  Top ups can be purchased at many stores.  You need a receipt in your name for the purchase of your cell phone to obtain a number.  Calling cards are available to reduce the cost of calling abroad — Chinese ones seem to have the best deals.  If you bring a ‘Magic-Jack’ from the USA and run another telephone through your computer, calls to the USA are free.  Well worth the investment!


Internet:  Nationwide, but speed differs depending on location.  Basic 512/128 kbps connection will set you back approximately $17 a month.  A slightly slower and cheaper service is available as are much faster and pricier options.  Find the price and package that best suit your needs and location.


Bill payment is blissfully simple.  You can pay at your local supermarket, bank or online.  Take the bill, or even an old one and you’ll be able to pay the outstanding amount.  Once you have a Costa Rican bank account, then paying through your online banking system avoids the inevitable long, long lines at the bank.


Household Staff — Hiring Your Girl Friday

Domestic Help:  It is very cheap to have a live-in or full-time maid, but do bear in mind that while you only have to pay the minimum wage, roughly $2 an hour as is set by the Ministry of Work (Ministerio de Trabajo) biannually, hiring domestic help comes with other financial responsibilities.  You are legally obliged to pay 11% of the amount of your employee’s salary as Security (Seguro) payments.  You are also responsible for paying for 15 days of annual vacation, Aguinaldo (the thirteenth month’s salary in December) and cessentia or severance pay.  Naturally, you wouldn’t want your maid to be without her rights, but make sure you calculate this into your budget before signing a contract with your employee.  A live-in maid can expect to have a reduced salary as she has full board and accommodation benefits.  The Ministry of Work’s estimation for a monthly salary, based on a 48 hour working week is $278 for the second half of 2011.


Lawn Care:  Employing a gardener is far simpler if you want someone to come and chop your yard on a regular basis.  They are self-employed and so you pay for the job and not as the employer.  Expect to pay about $25 to have a 5,000 square foot property chopped and raked up.


Security:  Many up-scale residential areas employ a guard or security service for a street or to cover a number of streets in the block.  You will be expected to pay your share of his salary and to contribute towards his Aguinaldo.  If the system is up and running when you move into an area, whether buying or renting a property, assume you are included in the plan, unless your landlord or neighbors say otherwise.  Your guard will be on a minimum wage, but the amount you pay is dependent on how many clients he has.


Taxes — This isn’t Kansas Anymore Toto…and that’s Good!

Municipality Taxes:   Homeowners pay an annual tax to their local municipality to cover services like street lighting and garbage collection.   Each municipality sets its own taxation tariffs, but you are unlikely to pay more than a $100 a year and you can break this up into four payments through the year.


Gringo Tax:  Although not an ‘official’ tax, you will get quoted higher prices for goods and services when the vendor sees your North American clothes and hears your accent.  The Costa Rican assumption is that foreigners from the US, Canada and Europe are rich and that it is only fair that they share the wealth.  You have two options:  either get annoyed, demand to pay the ‘Tico’ (Costa Rican) price and raise your blood pressure dangerously for the sake of a couple of dollars or alternatively, you can accept that you are rich compared to the average person on the street and as long as you’re not be ‘taxed’ to excess, save yourself considerably time and stress by accepting it!  All joking aside, if you want to reduce ‘taxation’, learn to speak some Spanish and have an idea of what you should be paying for something before you ask for a quote.


You may have to organize yourself a little to remember when all your bills will need paying without the guarantee of a printed reminder in your mail box, but once you’re in the swing of it, you’ll appreciate the huge savings!  All the more cash in your pocket for enjoying your retirement, just the way you hoped it would be.  How much does it cost to have a good time?  See our upcoming cost of Entertainment section in our ‘Cost of Living in Costa Rica‘ articles.  ‘Til then, spend wisely!

Cost of Living in Costa Rica
Utility Bills in Costa Rica Saves You $$
to Spend Elsewhere!
Photo Credit: Sara Ford


Cost of Living in Costa Rica
Monthly Electric Meter Readings
Calculate Your Bill.
Photo Credit: Sara Ford


Cost of Living in Costa Rica
Liquid Propane Gas Tanks are the Most Common Source of Cooking Fuel in Costa Rica.
Photo Credit: Sara Ford


Cost of Living in Costa Rica
A Properly Installed Electrical System in Your Home Saves Money & Keeps You Safe.
Have an Electrician Check Your Wiring.
Photo Credit: Sara Ford


The ‘Cost of Living in Costa Rica‘ series continues soon with more articles!


Reporting by Sara Ford
• Freelance writer for Vamos Rent-A-Car


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