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VAT WITHHOLDING ON E-COMMERCE SERVICES RENDERED FROM ABROAD

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VAT WITHHOLDING ON E-COMMERCE SERVICES RENDERED FROM ABROAD

A VAT withholding system for electronic or digital services rendered from abroad was implemented

 

Credit and debit card issuers, prepaid card vendors, third party cash collectors, and others, at the time of payment to suppliers from abroad, must withhold VAT, for the following electronic or digital services:

  • Provision of audiovisual services (among others, music, videos, movies and games of any kind, as well as broadcasting of any event);
  • Service of platform distribution of mobile applications;
  • Provision of advertising services online;
  • Supply of distance education or training

Law 1819 provides that this withholding system will enter into effect within 18 months after the law enters into force.  DIAN will indicate through a Resolution, the list of foreign providers that will be subject to the VAT withholding.

The VAT withholding is contemplated in Article 180 of Law 1819 of 2016.