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Taxes in Colombia

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Colombia, like any other emerging economy, is facing an increasingly competitive international economic environment, with certain advantages offered to foreign investors on taxes and incentives.

Taxes in Colombia can be of National or Regional level. National taxes apply to all the inhabitants of the national territory with the same tariff, meanwhile regional taxes have tariffs within a range determined by national law, which regions cannot surpass. Here is brief description of the most important taxes:

Taxes Definition Tariff
Income and capital gains tax

Income tax is a national tax levied on profits and gains derived from day-to-day operations (ordinary income). The capital gains tax applies over the extraordinary income.

Income tax: 34%1

Capital gains: 10%

Income Tax for Equality (CREE)

An extra charge is created for 2017 and 2018 for taxpayers with profits in excess of 800 million pesos.

6% for 2017 and 4% for 2018,

Sales tax (VAT)

VAT is an indirect national tax on services provided and on sales and imports of physical goods.

Three tariffs: 0%, 5% or 19%

Consumption tax

Indirect tax levied on vehicles, telecommunications, food and beverages.

4%, 8% and 16%

Tax on financial transactions

The tax is accrued on every transaction aimed at withdrawing resources from checking, deposit or savings accounts, and cashier checks.

0.4% of the value of the operation.

Industry and Commerce Tax

The industry and commerce tax is a local tax that is imposed on revenue generated from industrial, commercial or service activities carried out in the corresponding municipality.

Between 0,2% and 1,4% of the incomes of the company.

Property tax

This tax is levied annually on the ownership, usufruct or possession of real estate property. It is collected by the municipality where the property is located.

Between 0,3% and 3,3%.

Taxes on dividends

A new dividend tax is introduced for profits generated as from 2017 (accumulated profits from 2016 are respected)
The tax is caused to:

  • Resident natural persons
  • Non-resident legal and natural persons.

The dividend is generated at the time the shareholders' meeting approves that they are delivered. In the case of branches, it is generated when the dividends are transferred abroad.

  • Natural or legal person (non-resident) 5%,
  • Natural person (resident) 0% - 5% - 10%
  • Legal person (resident) 0%

  1 For 2018 and the following years the rate has been established in 33%.

For more information visit our LEGAL GUIDE.

Tax_system.pdf 310.67 KB
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