How do I open a bank account in Costa Rica for my corporation and what are the standard requirements?
by Quatro Legal Corporate Team | Dec. 10, 2023 | Article, Corporate
One of the most common needs to operate a business, maintain a real estate investment or reside in Costa Rica is to open a bank account at one of the public or private banking institutions in the country. However, for the expats is not always an easy process and on the contrary it is one that usually results in a lot of frustration as most of the times the account is not able to be opened or if opened it does not have a profile or limit that will serve as a solution to get around. The reason this is such a cumbersome process is that over the past few years, due to new regulations to prevent money laundering, banks have complicated this simple procedure, especially for foreigners and their corporations.
To avoid falling prey of the banking restrictions it is very important to understand the formal requirements any bank may request to open a corporate bank account. It is important to clarify every bank will have its own process and requirements.
– Certification of the corporation’s good standing issued by the Public Registry of Costa Rica or a public notary.
– Certification of stockholders prepared and issued by a public notary.
– Certification of corporate bylaws issued by a public notary.
– Copy of a public utility receipt or bill to confirm the corporation’s and representative’s physical address.
– Bank application and Know Your Client forms duly executed by the corporation’s representatives.
– For new corporations a certification of annual cash flow or income projection prepared by a public accountant is required. If on the other hand, it is a company that has started operation, financial statements shall be issued and signed by a public accountant and tax returns in connection with those financial statements maybe required.
Copy of the applicant’s passport or identity documents for the company representatives and shareholders.
Also, depending on the nationality of the representatives and directors, the bank may request specific forms such as FATCA forms which is a requirement for United States Citizens. FATCA is the acronym for Foreign Account Tax Compliance Act which require foreign financial institution – meaning Costa Rican banks – and certain other non-financial entities to report the foreign assets held by their United States account holders.
In general every bank will have its own procedure to open accounts and establish its own requirements. Nowadays some banks do not require for the company representatives and shareholders to be present and allow to sign electronically while others require for every shareholder and representative to be present.
Another important thing that expats must know when opening accounts in Costa Rica is that all accounts will be opened with a limit under which they will need to operate. This implies that any transactions outside of the account parameters maybe flagged by the banks. It is important for account holders to know their profile and its limitations including operational capacities of the online platforms which may carry restrictions for non-residents.
In connection with this, it is important for account holders to understand that banks have the faculty to inquire and request proof of the source of the funds that are moved through the bank accounts as part of Costa Rica’s banking supervision obligations. Source of funds shall be construed as proof of the legal activity in Costa Rica or the country in which funds were originated. It can be the sale of property, an inheritance, income from a business, equity loans, etc. To proof source of funds bank will normally require:
– Bank reference letter of the account funds are coming from.
– Four to six months of bank statements for the account funds are coming from.
– Two years of tax returns.
– Copy of the identification documents of the account holder of the account funds are coming from.
– Source of funds proof as explained above.
– If funds are coming from a corporation, banks will require documents attesting to its existence and validity.
If you need assistance opening a bank account please fill out the courtesy e-meeting form at the bottom. We will be glad to assist you!