Imagine this situation: you receive a notice from the Internal Revenue Service requesting documentation for the last three tax periods. Your accountant informs you that there are inconsistencies in the returns and possible contingencies for more than ₡15 million. Would your company be ready to respond with confidence?
In Costa Rica, 68% of companies face some type of tax contingency each year, according to data from the Ministry of Finance. With the entry of Hacienda Digital in October 2025 and the new automated auditing systems, the risk of detecting inconsistencies has multiplied exponentially.
A strategic fiscal diagnosis is the most effective preventive tool to identify tax risks before they become costly problems. Unlike a reactive audit, this proactive analysis allows your company or organization to detect errors, optimize deductions and prepare for the new digital requirements of the tax administration.
According to the OECD, Costa Rica has intensified its tax controls in 2024-2025, increasing tax collection by 23%. Companies operating without a preventive tax review are sailing blind in increasingly turbulent waters.
In this comprehensive guide, you will learn the 7 unmistakable signs that your company needs an immediate tax diagnosis, how the process is performed, what differentiates it from other tax services, and how it can save you millions of colones in avoidable contingencies.
By the end of this article, you will have a self-assessment checklist, you will know the real cost-benefit of a tax diagnosis and you will know exactly how to prepare your company for the era of Hacienda Digital.
What is a Strategic Fiscal Diagnosis?
Before identifying whether your company needs this service, it is essential to understand exactly what it entails and why it is considered "strategic".
Service Definition and Scope
A strategic tax diagnosis is a comprehensive and preventive analysis of a company's tax situation to identify risks, contingencies and opportunities for tax optimization. It is not a mandatory audit but a voluntary and proactive review.
The typical scope includes review of returns for the past 3-4 years, analysis of related party transactions, verification of formal and substantial compliance with all tax obligations, and assessment of the current tax structure.
The approximate duration is 4-6 weeks depending on the size and complexity of the company. The result is a detailed report with a risk matrix classified in three levels (high, medium, low) and a corrective action plan with specific deadlines.
Key difference with auditWhile the audit validates compliance in an exhaustive manner and can be mandatory, the diagnosis is strategic and preventive, focusing on critical aspects that represent the greatest risk or opportunity for your business.
The Three Pillars of Strategic Fiscal Diagnosis
Any effective fiscal diagnosis is based on three fundamental pillars that work in an integrated manner.
Pillar 1: Tax Compliance
This pillar verifies that all obligations are being properly complied with. It includes the review of income tax returns, VAT, withholding taxes, municipal taxes and commercial patents.
It also validates compliance with formal obligations such as the registration of beneficial owners with the Central Bank, the correct issuance of electronic invoices according to current standards, and the timely filing of all returns.
Companies operating in multiple cantons must comply with different municipalities, which complicates the picture. The diagnostic can also identify whether they are in good standing with each jurisdiction.
Pillar 2: Identification of risks and contingencies
Here we analyze where the Treasury could detect problems in an eventual audit. This includes the review of operations with related parties to verify if they comply with market transfer prices.
Substantiation of deductible expenses is evaluated: are all electronic receipts valid? Are the expenses causal to the generation of income? Are there personal expenses mixed with business expenses?
It also identifies possible adjustments that the Internal Revenue Service could make, such as reclassification of income, rejection of insufficiently documented deductions, or differences between what is declared and what is reported in electronic invoicing.
Pillar 3: Optimization opportunities
Diagnostics not only detects problems, it also uncovers money that is being left on the table. Identify tax incentives for which your company qualifies but is not taking advantage of, such as free trade zone benefits, special regime for SMEs, or deductions for disabilities and innovation.
We analyze deductions allowed by law that you are not applying, such as certain representation expenses, investments in technology, or contributions to employee pension funds.
In many cases, a smart corporate restructuring can generate significant tax efficiencies without changing the actual operations of the business.
Why It's Called "Strategic
The term "strategic" is not empty marketing, it has solid foundations. This type of diagnosis goes beyond basic compliance and seeks the optimal fiscal positioning for your company in the medium and long term.
It integrates with your business strategy and financial planning. For example, if you plan to expand into new provinces, the diagnostic considers the municipal tax implications of each location.
It allows you to make informed decisions on major investments, asset acquisitions, hiring of personnel, or corporate restructurings. A pre-diagnosis can save you millions in tax efficient structuring.
Anticipates regulatory changes (such as Hacienda Digital) and prepares your company proactively instead of reacting hastily when it is already mandatory. Consider the entire economic group, not just isolated entities, identifying synergies and risks between related companies.
Revealing fact: More than 80% of the cases in which we perform diagnostics reveal savings of between 5 and 14% per year.
💡 KEY POINT: A strategic tax diagnosis is not an expense, it is an investment. For every dollar invested in prevention, companies save on average $7 in avoided contingencies and identified tax optimization.
Why Your Company Needs a Tax Diagnostic in 2025
While fiscal diagnosis has always been valuable, Costa Rica's tax context in 2025 makes it absolutely critical. Three factors converge to make this year decisive.
Digital Treasury: The Changing Tax Paradigm
October 6, 2025 marks a before and after in Costa Rican auditing with the official entry into force of Hacienda Digital. This system, inspired by European models, represents the most profound modernization of the tax administration in decades.
Hacienda Digital integrates DGH, DGT and Customs systems to create full traceability of commercial operations. Every electronic invoice, every purchase and import and every declaration will be automatically cross-referenced by artificial intelligence algorithms.
The most dramatic change is the speed of detection. Previously, inconsistencies could go undetected for 12-18 months until a human auditor manually reviewed them. With Hacienda Digital, detection is virtually real-time.
Companies with compliance issues will receive Tax Mailbox notifications in a matter of weeks, not years. The margin for "mistakes that go unnoticed" will disappear completely.
Traceability includes mandatory CAByS codes in invoicing, interoperability with customs platforms for importers/exporters, and automatic cross-checks between declared VAT versus VAT in electronic invoices issued.
Blunt reality: With Hacienda Digital, operating with tax inconsistencies is not only risky, it is virtually impossible to go unnoticed for more than a few months.
Intensification of Post-Pandemic Tax Controls
Costa Rica faces fiscal sustainability challenges that have intensified collection efforts. The Ministry of Finance has significantly increased the frequency and depth of audits since 2023.
The priority focus is on large taxpayers and high-risk sectors such as e-commerce, professional services, construction and international trade. The Tax Mailbox has become much more active with frequent requests for information.
The tax administration implemented risk analysis through Big Data, identifying patterns of evasion or avoidance with greater precision. Costa Rica also actively participates in international cooperation initiatives for the exchange of tax information under OECD/BEPS standards.
Alarming real case: In 2024, a distributor with revenues of ₡500 million annually received tax adjustment of ₡42 million for personal expenses not correctly identified, plus interest and penalties of the additional 75%. Total: ₡73.5 million. A previous diagnosis would have identified and corrected this error for less than ₡2 million.
Increasing Complexity of Tax Regulations
Costa Rica's tax regulatory framework has become significantly more complex over the last five years. The Law for the Strengthening of Public Finances (in force since 2019) introduced profound changes in rates, tax bases and obligations that continue to be adjusted.
Changes in electronic invoicing are constant, with new mandatory fields and validations every year. Regulations on beneficial ownership and corporate transparency were tightened to meet international anti-money laundering standards.
Changes in transfer pricing and related party transactions now require much more robust documentation. The special regime for SMEs under Law 10392 offers important benefits but has specific requirements that many are unaware of.
Keeping up with all these changes is virtually impossible without specialized dedication. Your accountant may be excellent, but if he or she is not constantly training, he or she may be applying obsolete criteria.
💡 KEY POINT: In 2025, not being fiscally up to date is not just risky - with Digital Treasury, it's almost impossible to go undetected. The question is not "if" you will be detected, but "when".
The 7 warning signs that cannot be ignored
Now that we understand the importance of fiscal diagnosis, it is time to evaluate if your company has any of these warning signs. If you identify three or more, you need to act immediately.
Signal #1 - Your Meter Constantly Changes or Appears to Overflow
The high turnover of accounting personnel generates serious inconsistencies in criteria and records. Each new accountant applies his or her own interpretation of the rules, creating a fragmented and potentially problematic tax history.
A single accountant without backup concentrates all the fiscal knowledge of your company in one person. If he gets sick, resigns or simply makes a mistake, there is no one to detect it in time.
Accountants who are not regularly trained in new regulations apply obsolete criteria.
Visible signs: Constant delay in filing returns, frequent errors that require correction, lack of knowledge of recent obligations, nervousness when talking about the Ministry of Finance.
Signal #2 - Inconsistencies between Financial Statements and Tax Statements
Significant differences between book income and taxable income without a clear and documented tax reconciliation are an immediate red flag. The IRS will automatically detect them with its new systems.
Reported sales must match perfectly with the sales on your income tax return. Any unexplained difference raises suspicion of undeclared income.
The VAT to be charged on your electronic invoices must correspond exactly with the VAT declared on the D-104 form. With Hacienda Digital, this cross-referencing is automatic and immediate.
Signal #3 - You have received inquiries from the Internal Revenue Service that could not be fully answered.
Requests for information that were not responded to in a timely manner (15 business days) or that we partially responded to generate "red flags". Failure to provide supporting documentation when requested indicates record keeping and archiving problems. Requests for specific transactions without clear economic justification (e.g., interest-free loans to shareholders, personal expenses in the company, transactions with related parties at non-market prices) are signs that we are already on the radar.
If you have had previous citations or audit visits, even if they did not result in minor adjustments, it means your risk profile is already elevated. The next review will be more thorough.
Signal #4 - Operation under multiple entities but no clear Structure
Economic groups with several companies but no formal transfer pricing policy are at very high risk. The tax authorities may adjust the taxable income of all entities if they consider that the transactions between them are not at market value.
Transactions between related companies without formal written contracts lack legal support. It is required to have contracts for services, leasing, purchase and sale, loans, etc., between your companies.
Loans between group companies without documentation, without agreed interest, or without defined terms may be considered dividends or generate presumptive interest.
The personal use of business assets (vehicles, properties, corporate credit cards) without control or allocation of value generates unreported taxable income. The tax authorities may impute significant presumptive income.
Expenses shared among several companies without a justified and documented apportionment (such as office rent, legal/accounting services, administrative personnel) may be disallowed as deductible in all companies.
Signal #5 - Your tax burden seems disproportionate compared to the economic sector.
If your effective tax rate (tax paid / net income) is significantly higher than the average for similar companies in your industry, you are probably paying more than necessary.
Do not take advantage of tax incentives available or legal means to lower your taxes means leaving money on the table year after year, money that your competitors may be capitalizing on.
There are allowable deductions that many companies do not apply due to lack of knowledge: technical training expenses, investment in research and development, donations to authorized institutions, additional contributions to employee pension funds, for example.
Inefficient corporate structures from a tax perspective are common. Many entrepreneurs have configurations that generate avoidable double taxation or do not take advantage of legal structural advantages.
Benchmark for Costa Rica 2025:
- Technology/professional services SMEs: average effective rate 18-22%
- Commercial SMEs: average effective rate 20-24%
- SMEs industrial/manufacturing: average effective rate 15-20%
- Free zone enterprises: 0-15% (according to proportion of local sales)
Signal #6 - Expansion plans, significant investment or change in structure
Before opening new locations, branches or subsidiaries in other provinces or countries, a thorough tax analysis is required. Each jurisdiction has specific tax implications that should be considered before making a commitment.
Prior to investments over certain amounts (purchase of real estate, acquisition of machinery, fleet vehicles, investment in technology), a tax analysis can optimize the structure of the purchase and maximize depreciation.
When considering a change of tax regime (e.g., from traditional regime to free trade zone, or vice versa) the implications are enormous. A mistake in timing or structure can cost millions.
When it comes to corporate restructuring, mergers or takeovers, tax considerations are complex and mistakes are extremely costly. It is necessary to plan the optimal structure before executing.
When evaluating the entry of new partners or investors, or in the process of selling the company, a recent tax assessment is invaluable. Sophisticated buyers will demand it in the due diligence, and discovering contingencies at that stage can ruin the transaction.
Signal #7 - A tax audit has never been performed (or more than 3 years have elapsed).
Tax regulations are constantly changing in Costa Rica. What was correct or allowed 3 years ago may not be today. If your last complete tax review was more than 36 months ago, you are operating with outdated information.
The tax statute of limitations in Costa Rica is 4 years from the filing of the tax return. You need to review at least that entire period to identify contingencies that have not yet prescribed and can be detected by the Treasury.
The internationally recommended professional practice is to perform tax audits every 2-3 years minimum for stable companies. For companies in rapid growth or with frequent changes, the recommendation is annually.
Recommended frequency according to profile:
- Stable microenterprise (₡50-200M): every 3-4 years
- Stable SME (₡200M-₡1B): every 2-3 years.
- Growing SMEs: every 18-24 months
- Medium/large company (₡1B+): annually
- Complex economic group: annually + specific revisions for changes
💡 FINAL EVALUATION: How many signs did you identify in your company?
- 1-2 signals: Recommended monitoring, consider a diagnosis in the next 12 months.
- 3-4 signals: Diagnosis needed in the next 6 months
- 5+ signals: Act immediately - your company is at significant tax risk and needs urgent diagnosis in the next 4-6 weeks.
Key Differences: Diagnosis vs Audit vs Tax Planning
There is often confusion between these three tax services. Let us clarify their differences so you can apply for exactly what your company needs.
| Criteria | Fiscal Diagnosis | Tax Audit | Tax Planning |
| Main objective | Identify risks and opportunities |
Verify compliance and validate financial statements | Design future fiscal strategy |
| Timing | Preventive, before of problems |
Mandatory or reactive to requirements | Projected, at the beginning of the fiscal year |
| Depth | Comprehensive but focused on critical aspects | Comprehensive regulatory compliance | Foresight in future scenarios |
| Typical duration | 4-6 weeks | 2-4 months | 2-3 weeks |
| Result | Report with risk matrix and corrective plan | Tax return and audited financial statements | Annual fiscal strategy with projections |
| Who needs it | Every company (every 2-3 years) |
Large taxpayers | Growing companies, complex operations |
When You Need Each (And When You Need All Three)
Diagnosis only: Stable 5-15 year SME seeking to validate its current compliance, detect unknown risks and find optimizations. It is the most common and recommended service.
Audit only: When it is legally required (large taxpayers, regulated companies, companies that present irregularities detected by the systems regardless of their size), when required by a bank for important financing, or when formally requested by the Treasury.
Planning only: New company that is establishing its tax bases, or mature company facing a major strategic change (international expansion, merger, change of business model).
Diagnosis + Planning: Ideal combination for most Costa Rican SMEs. Diagnosis detects current and past problems, planning prevents future problems and optimizes the route.
The Three Services: Large companies or complex economic groups with international operations, multiple lines of business, or sophisticated corporate structures.
💡 KEY POINT: Most Costa Rican companies do not need costly tax audits every year, but ALL benefit from a tax audit every 2-3 years. It is the most favorable cost-benefit ratio in tax services.
Strategic fiscal diagnosis has become a basic business requirement
In an increasingly digitized, automated and controlled Costa Rican fiscal environment, the strategic fiscal diagnosis is no longer an optional luxury but a basic business necessity. The 7 signs we explored (unstable accountant, financial inconsistencies, poorly addressed requirements, complex corporate structure, excessive tax burden, expansion plans, and lack of prior diagnostics) are clear and urgent indicators that your company needs professional preventive tax care.
With Hacienda Digital being fully implemented in October 2025, the margin for "benign errors" or "inconsistencies that go unnoticed" will disappear completely. Algorithmic systems will automatically detect any discrepancies between your electronic invoicing, your tax returns, and the information they cross-reference with other sources. Notifications will arrive in weeks, not years as before.
A tax diagnostic allows you to identify and correct problems before the IRS finds them, saving you not only money in contingencies and fines, but also time in tax audits, business reputation with customers and suppliers, and personal peace of mind to focus on growing your business instead of putting out tax fires.
The difference between companies that thrive sustainably and those that constantly struggle with tax problems is not in size or sector, but in their structural soundness. Fiscal health is a fundamental pillar of that strength, as important as having a good product, satisfied customers or orderly finances.
Successful entrepreneurs do not react to tax problems when they are already upon them; they prevent them strategically and proactively. They invest in knowing their true tax position, in identifying risks before they materialize, and in optimizing their tax burden within the legal framework.
Frequently Asked Questions about Strategic Fiscal Diagnostics
How long does it take to complete a fiscal diagnosis?
A standard strategic fiscal diagnosis takes between 4-6 calendar weeks from inception to submission of the final report. The time is distributed as follows: collection and delivery of documentation by the client (1 week), preliminary analysis by the consultants (1 week), face-to-face or virtual functional interview (1 day), in-depth analysis and quantification of findings (2 weeks), preparation of the report and recommendations (1 week), and final presentation with adjustments (1 week).
Companies with highly organized digital documentation and robust accounting systems can complete the process in 4 weeks. More complex organizations with multiple entities, scattered information, or outdated systems may require up to 8 weeks.
The most important determinant of total time is the speed with which your team can collect and deliver the requested information.
Is a tax audit mandatory in Costa Rica?
No, the strategic fiscal diagnosis is completely voluntary and proactive. It is not a legal requirement as is the external audit for certain types of companies.
However, although it is not mandatory, it is highly recommended for several reasons of business prudence: it allows you to identify and correct problems before tax audits, take advantage of tax optimizations that you were probably unaware of, adequately prepare for regulatory changes, improve your position before bank financing or sale processes, and significantly reduce the stress of operating with tax uncertainty.
With the entry of Hacienda Digital in 2025, although the diagnosis remains legally optional, it becomes practically indispensable in practical terms for any company that wants to operate with peace of mind and tax efficiency.
What is the difference between a tax audit and a tax audit?
They are fundamentally different in purpose, scope and outcome. The tax diagnosis is preventive and strategic: it is requested voluntarily to identify risks, contingencies and opportunities before there are problems. It focuses on critical aspects of the company's tax situation with a broad scope but not necessarily exhaustive in every detail. It takes 4-6 weeks.
The tax audit is exhaustive and validating: it can be legally mandatory or required by the Treasury, banks, or investors. It aims to validate full compliance with all tax obligations and issue a formal opinion on your financial statements. It reviews each transaction in forensic depth.
The medical analogy is useful: the tax diagnosis is like an annual preventive checkup where the doctor checks your vital signs, identifies risk factors and recommends changes in your habits. The tax audit is like exhaustive specialized exams that are done when there is a suspicion of a specific disease or when you must legally certify your health status. Ideally, regular preventive diagnostics (every 2-3 years) and full audits are done only when legally required or specifically necessary.
Can the IRS use the result of my tax diagnosis against me?
No. The tax diagnosis is a strictly private and confidential document between the company and the tax consultant, protected by professional secrecy. The tax authorities have no access to it and no authority to request it unless you voluntarily decide to submit it (which is rarely necessary or advisable).
In fact, the purpose of the diagnostic is precisely the opposite: to detect problems BEFORE the IRS finds them, so that they can be corrected proactively. If the diagnosis detects errors or omissions in non-prescribed periods, voluntary corrective returns can be made.
The diagnostic report is the property of the company and is used as an internal roadmap to correct problems and optimize the tax and legal situation.
Is my company too small to need a tax audit?
Absolutely not. There is no company "too small" to benefit from a preventive tax diagnosis. Even micro-companies with a turnover of ₡50-₡150 million per year can have significant contingencies of several million colones or be paying more taxes than necessary due to ignorance of allowable deductions or applicable incentives.
In fact, smaller companies are often at GREATER tax risk because they typically do not have a robust accounting department, and are unaware of tax benefits for which they qualify (such as the special SME regime).
There are "express" or simplified tax diagnoses specifically designed for smaller companies, with scopes adjusted to their reality and accessible costs from $1,500-$2,500. The cost is proportional to the size and complexity.
The criterion should not be "is my company too small?" but rather "does my company have formal tax obligations before the tax authorities?" If the answer is yes, then there are benefits in knowing with certainty if it is complying correctly and if the tax or legal situation can be optimized.
How often should you perform a fiscal diagnosis?
Stable small companies (₡50-300M turnover, no structural changes): every 3-4 years minimum, sufficient if no major changes in operations or regulations.
Stable medium-sized SMEs (₡300M-₡1,000M turnover): every 2-3 years, considering that at this size potential contingencies warrant more frequent review.
Fast-growing SMEs o with frequent changes: every 18-24 months, because constant changes generate a greater probability of errors or missed opportunities.
Medium/large companies (₡1,000M+ turnover) or economic groups: annually, ideally at the beginning of the fiscal year, because the complexity justifies constant monitoring and the investment is marginal compared to the risks.
Additional mandatory independent of the regular cycle: ALWAYS before any major structural change such as merger, acquisition, corporate restructuring, expansion into new jurisdictions, change of tax regime, or sale of the company.
Special recommendation for 2025: If you have not had a tax diagnostic in the last 2 years, we recommend doing one BEFORE October 2025 to adequately prepare for Hacienda Digital. This is a time of significant enough regulatory change to warrant review even if you had a diagnostic 18-24 months ago.
Final words: Your company deserves to operate with tax certainty, not uncertainty and fear. A strategic tax diagnosis provides that certainty, that clear map of the terrain, and that peace of mind that allows you to focus on what really matters: growing your business in an orderly and confident manner.