DECREE OF THE MINISTRY OF FINANCE
The book-to-tax reconciliation process mentioned in Section 772-1 of the Tax Code is defined
The book-to-tax reconciliation will be composed of the “control of detail” and the “tax reconciliation report”
In its Decree 1998 of November 30th the Government regulated the mechanisms through which taxpayers that are required to carry accounting books will perform the control or reconciliation of differences between the new regulatory technical frameworks and the provisions of the Tax Code. This obligation was incorporated by Law 1819 of 2016 into Section 772-1 of the Tax Code.
In general, the decree establishes that the tax reconciliation will be composed of the “detail control” and the “tax reconciliation report”. When there are book-to-tax differences which could be explained and identified through the “tax reconciliation report”, it will not be necessary to keep the “detail control”. Taxpayers with a gross income equal to or greater than 45,000 UVT are required to submit these reports. However, all taxpayers obliged to keep accounting records must fill out the report, which must be kept available for DIAN in case that it requires it.
The failure to comply with the formal obligation to carry the tax reconciliation report constitutes an irregularity in the accounting, which would be subject to tax penalties.