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SPECIAL VAT EXEMPTION ON THE ACQUISITION OF CAPITAL GOODS IS EXTENSIVE TO RELATED SERVICES

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SPECIAL VAT EXEMPTION ON THE ACQUISITION OF CAPITAL GOODS IS EXTENSIVE TO RELATED SERVICES

Input VAT on transportation and installation of capital goods, can be deducted from income tax according to section 115-2 of the Colombian Tax Code

According to section 115-2 of the Colombian Tax Code, input VAT on the acquisition of capital goods can be computed as tax deductible. However, the aforementioned section did not referred expressly to related services

 

Therefore, by means of Revenue Ruling No. 0000319 of 2018, the Colombian Tax Administration concluded that input VAT on transportation and installation of capital goods can be computed as tax deductible, extending the tax treatment set forth by section 115-2 of the Colombian Tax Code to services rendered for setting up capital goods.

For this purpose, the Colombian Tax Authority considered that the input VAT on services related to capitals good have to be included in the same invoice.