Working Online in Costa Rica as An Expat (Is it legal? Where to find work? How much can you make?)
Updated: Jul 3
You're not alone if you’re wondering how to work online as an ex-pat. According to www.abrotherabroad.com, the global population of digital nomads is ~ 35M, with a collective economic value of ~ USD 787B.
This means the number of digital nomads worldwide by age looks like this—
· 20s – 4,900,000
· 30s – 16,450,000
· 40s - 5,600,000
· 50s - 6,650,000
· 60s - 1,400,000
It’s doable! My husband and I earn a portable income while living in Costa Rica and traveling. As a result, our life is whole and happy.
Let’s clear up digital nomad (a common term) vs. working online.
A digital nomad is anyone who works online performing their job. They use mobile technology, which gives them location freedom.
*NOTE—A digital nomad routinely changes their location, staying for anywhere from two days to years, but they ultimately move around. Working online doesn’t mean you have to be a digital nomad.
For example, while earning a portable income, we are not digital nomads. Instead, we choose to make a home for ourselves here in Costa Rica, working online freelancing and digital marketing. We travel for enjoyment, but we keep a home.
Why work online in Costa Rica?
People come to Costa Rica as ex-pats for different reasons—wanting a change of lifestyle, looking for a lower cost of living, wanting to raise a family outside the U.S. and Canada, and being ready to retire.
Those who work online do it for different reasons—the need to earn income, the desire to stay relevant and be of service, wanting to keep working on their terms, padding retirement, and more.
Depending on your reasons for both, Costa Rica is an excellent country to earn an income as an ex-pat while enjoying all that it has to offer, the Pura Vida mindset, waterfalls, lush green landscapes, beautiful beaches, inviting cities, good food, excellent and inexpensive healthcare,
tropical climate, and a blue zone.
First, about working (not online) in Costa Rica.
To legally work (in person, not online) in Costa Rica, you must be a citizen or a legal permanent resident. Therefore, you will need a work visa if you do not fit into one of those categories.
What it takes to obtain a work visa in Costa Rica is difficult—it costs money and takes time, so many of us work online because we can.
To be an employee…takes a lot.
To work as an employee in Costa Rica, you need a work visa which can be a 5–7+-month process. To do this, your first step is getting a residence permit.
There are different residence permits, but they don’t all allow foreigners to work.
· a temporary residence permit for retirees receiving social security does not allow you to work as an employee in Costa Rica
· A temporary residence permit for renters showing a stable income of $2,500 per month for two years does not allow you to work as an employee in Costa Rica.
· A temporary residence permit is for executives and personnel who work for corporations established in Costa Rica. You can be an employee with this permit.
· A temporary residence permit for investors who invest at least $200,000 in a business, stocks, or real estate does not allow you to be an employee but will allow you to own and manage your own business. However, you MUST hire local labor.
*NOTE—It’s important to remember that non-residents of Costa Rica can manage and own their business but NOT perform any business duties or tasks. Unfortunately, foreigners often make this mistake unintentionally or try to get away without “getting caught.”
A business owner must have at least one employee on “Seguro Social” (CAJA*).
*NOTE — CAJA is Costa Rica’s social security system. To be a member of CAJA, you must be a resident. As a member, you pay a percentage based on your declared income level when you apply for residency.
If you are an owner and an immigration agent stops by for a surprise inspection and catches you serving clients, you risk deportation and other severe penalties.
These laws, like in all countries, are designed to protect the rights of the citizens and legal residents of Costa Rica.
Bottom line? Don’t try to get away with anything when living in a foreign country.
As you can see, choosing to work in Costa Rica as a business owner or employee is complicated and takes an investment in energy, time, and money.
Before going this route, consider what investment you are willing to make for what return.
To find out how more about how to obtain a permit to visit, live or work in Costa Rica, here are two reliable sites to answer your questions—
Working Online in Costa Rica
There are several ways to work online which don’t require Costa Rica residency.
We earn portable income through freelancing, coaching, and digital marketing.
We freelance online using the skills we learned through our careers, use digital marketing to earn money as affiliates (earning commission selling others’ products and services), and we use all of this to coach others on how to do the same.
And because we are U.S. citizens, all the money we earn through online income is subject to U.S. federal taxes. So we declare our income living in Costa Rica, working with a U.S. accountant, just as we did living in the states.
Freelancing is the simplest way to start your income, which you can begin even before you move and continue earning while living here.
Working Online—Is it legal?
You can apply for Costa Rica’s Digital Nomad Visa, but even without the visa working online is legal in Costa Rica.
The Digital Nomad Visa is called “estancia” in Costa Rica.
· You can be self-employed or work as an employee for a company.
· You must make a steady income of at least $3,000 per month over the past year and prove that you can continue receiving at least this amount.
· For a family, the threshold goes up to $4,000 per month. Incomes can be combined to meet this amount, but a marriage certificate is required.
· The visa is valid for one year and renewable for an additional year if the holder has spent 180+ days in Costa Rica in their first year.
· Medical insurance must be purchased for the length of stay
· Application fees
· You can stay in Costa Rica for the whole time of your visa, with a possible extension, without having to leave every 90 days. You can come and go as you please.
· You are exempt from Costa Rican income taxes (vs. being an employee)
· You are exempt from import taxes on work equipment
· With your valid foreign driver's license, you have driving privileges for the length of your visa without leaving every 90 days.
· The process of applying online is quicker compared to other visas.
Full disclosure — we do not have a digital nomad visa. We leave the country every 90 days for the day or take a trip. 2023 is the year we will consider if we want to apply for residency.
Where can you find work?
There are different ways to earn a portable income; freelancing, digital marketing, and relationship marketing are the three most popular ways.
For working online, freelancing is undoubtedly the easiest “jump off” point. You can start a freelancing side hustle before you move to see what you can do, build confidence, and be ready to go. This is what we did.
There are several freelance sites to choose from, with 100+ total. Some include:
Freelancing is made up of categories of skills that you can use to make an income.
*NOTE —An important distinction when considering freelancing is not confusing what you did for your career and your skills.
For example, you could have been a dental hygienist for 25 years, wondering what you could do online. You used skills such as communication, collaboration, critical thinking, attention to detail, organization and time management, etc.
These skills can be translated into freelancing for clients looking for them.
Upworklists these as the top freelancing jobs in 2023 (there are many more!)
Freelancing allows you to manage your business, work the hours you want, where and when you want, and choose your clients.
You can control your rates and choose from various projects.
How much can you make?
For the last 15 years, Barefoot Consultants, an international training and consulting company, has helped individuals work as freelancers on the global market.
They provide this glimpse into what you can earn as a freelancer—
· Casual Attention, 20%-30% intensity = $500 - $1,500 per month
· Involved Attention, 40%-60% intensity = $1,500 - $3,000 per month
· Focused Attention, 70%-100% intensity = $,3000+ per month
*Rates are different based on skills and offers
Other ways to earn income online include—
Remote work with a U.S. company – If you are an employee of a U.S. company, and they allow you, you can work remotely. Choosing this method is between you and your company.
Digital Marketing — Using the internet and digital technologies to promote products and services. Included with digital marketing is affiliate marketing, selling other people’s products and services by promoting them and earning sales commissions. This can be a good option if you want to sell and earn a commission without having your products and services.
Multilevel Marketing (MLM) — This business model is based on hierarchical sales teams selling products and services to consumers while recruiting additional sales reps. MLM has been around for a long time and is considered controversial by some.
A Final Thought
We earn a portable income here in Costa Rica. We chose this lifestyle and have found it an excellent way to go for us.
If you’re considering moving here and wondering how to continue earning an income, consider doing it online as a viable option.
Millions are working this way around the globe, and this number doesn’t appear to be slowing down any time soon.
Check out this article from Bloomberg to read their outlook for freelancing.
If you’ve considered working online, this is an excellent time to start.
Here’s to your journey!
Pura Vida! 🌺
James, Jeanne, Cousteau & Ferdinand 💕🐩🐩