Are you a foreigner with permanence or making transactions in Colombia?
This information may concern you…
In order to avoid future contingencies before the Tax Administration, here are the criteria you should verify to see if you are obligated to fulfill the formal duty to declare income taxes in Colombia and not have to bear the risk of not complying with these obligations. Please note that on August 6th the deadlines to present and/or pay your income tax return begin.
In Colombia, both residents and non-residents must file income tax returns, as they meet some considerations.
How to know if you are a resident in Colombia for tax purposes?
A. If you are a foreigner, but between 2017 and 2018, you stayed continuously or intermittently for more than 183 days in Colombia, in a period of 365 days – for which we suggest you check your passport- you become a Colombian Fiscal Resident, independent of your origin country, and therefore, you will be required to submit the income tax return for the fiscal year 2018.
B. If you are Colombian and have been absent from the country, but meets at least one of the following points:
- Between 2017 and 2018 you entered into the country and remained continuously or intermittently for more than 183 days, in a period of 365 days – for which we suggest you check your passport- you become a Colombian Fiscal Resident.
- Your spouse or permanent partner (not legally separated) or under-aged dependent children, have a tax residence in Colombia.
- Fifty percent (50%) or more of your income derives from a national source.
- Fifty percent (50%) or more of your assets are managed in Colombia.
- Fifty percent (50%) or more of your assets are understood to be possessed in Colombia.
- Having been required by the Tax Administration for it, no proof of a foreign resident tax status is submitted.
- Have a fiscal residence in a jurisdiction qualified by the National Government as a “tax haven”.
However, if you meet any of the above points, but at least one of the following 2 points applies to you, you will not be a Fiscal Resident.
- That fifty percent (50%) or more of your annual income has its source in the jurisdiction in which you have your domicile.
- That fifty percent (50%) or more of your assets are located in the jurisdiction in which you have your domicile.
What information should you report in your income tax declaration?
Under this Resident status, you will be required to report to the Tax Administration all information related to:
- Your assets (real estate, vehicles, bank accounts, investments, among others) owned both in Colombia and abroad.
- The income received in Colombia and abroad.
Note that, on the income declared abroad, you may allocate related costs and expenses considering the limits established in the tax regulations and deduct the tax paid abroad for that income.
And if according to the previous points I am not a Fiscal Resident, should I submit an income tax return?
If you are not a Fiscal Resident in Colombia, you must submit your income tax return, only informing the Tax Administration the following:
- Your assets (real estate, vehicles, bank accounts, investments, among others) owned only in Colombia.
- Only the income received in Colombia.
When all of the income received in Colombia was subject to withholding at source for payments abroad, you will not be required to file a declaration in Colombia.
When is my deadline to submit the income tax return?
This deadline depends on the last 2 digits of the NIT (Tax identification number) that has been assigned to you at the time of the RUT (Comprehensive Tax Registry) registration, starting on August 6 until October 17, 2019.
What happens if I don’t file the income tax return?
The tax authorities hae 5 years to investigate you and initiate a sanction process for not presenting the income tax declaration. Also, in accordance with the provisions of article 4348 of the Criminal Code, this could lead to a tax fraud crime.
What if I submit it after the deadline?
You will be subject to a penalty for extemporaneity calculated on the tax, income or assets, according to the case.
If you wish to make an appointment with our tax specialists, please contact Gabriela Ranowsky at firstname.lastname@example.org
Disclaimer: This general information is presented for illustrative purposes only and cannot be taken as a tax consultation. You should consult with a tax specialist before taking any decision regarding this matter.
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