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DIAN REVENUE RULING

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DIAN REVENUE RULING

Deduction of royalties incorporated in the cost of acquired goods  

The Colombia Tax Authority referred to the tax deduction of royalties associated with the acquisition of finished products

 

By means of Revenue Ruling No. 318 of March 23rd 2018, the Colombia Tax Authority considered that royalties that are incorporated into the cost of a finished good, paid at the moment of acquiring the product, are not tax deductible, unless the taxpayer demonstrates before the Tax Authority that the royalty was not included into the acquisition price of the finished product for its later sale.