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Legal Bulletin

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INTERNATIONAL TAX LAW

COLOMBIA AND THE UNITED STATES ENTER INTO A TAX INFORMATION EXCHANGE AGREEMENT IN ORDER TO CARRY OUT THIS EXCHANGE IN THE PRACTICE

The 20th of May 2015, the Colombian government and the government of the United States subscribed the Agreement in order to improve tax compliance and implement the automatic exchange of information within the framework of the Foreign Account Tax Compliance Act (FATCA). DIAN will receive the tax information by September 30 of each year.

DIAN FOREIGN EXCHANGE RULING

DIAN ISSUES A RULING ADDRESSING THE CASES THAT PREVENT IMPORTERS TO FULFILL THEIR PAYMENT OBLIGATIONS WITH FOREIGN SUPPLIERS

Acting as foreign exchange authority, DIAN discussed the cases which may legally justify the failure to channel these payments through the foreign exchange market

DIAN REVENUE RULING

DIAN ISSUES A REVENUE RULING ON INTEREST PAYMENTS MADE TO FOREIGN ENTITIES NOT SUBJECT TO WITHHOLDING TAX IN COLOMBIA

Interest payments which are not considered as Colombian source income are not subject to withholding tax, but may be deductible from income tax

DIAN REVENUE RULING

DIAN ISSUES A REVENUE RULING REGARDING THE CASE IN WHICH THE MERGER OF FOREIGN COMPANIES WITH ASSETS LOCATED IN COLOMBIA IS CONSIDERED A SALE FOR TAX PURPOSES

If more than 20% of the assets belonging to the multinational group are owned through branches in Colombia, its transfer is a taxable event

DIAN REVENUE RULING

CREE TAX TREATMENT OF NEGATIVE ADJUSTMENTS IN FOREIGN EXCHANGE DIFFERENCES

DIAN upheld that these adjustments are deductible expenses in the respective tax period

DIAN REVENUE RULING

REVENUE RULING ON THE WITHHOLDING TAX APPLICABLE TO PAYMENTS MADE TO FOREIGN ENTITIES

DIAN determined that the 33% rate of withholding tax is still applicable to payments made to foreign entities which are not attributable to a branch or permanent establishment in Colombia

CONSTITUTIONAL COURT RULING

THE CONSTITUTIONAL COURT UPHELD THAT THE TAXABLE BASE OF THE CREE TAX MUST INCLUDE THE POSSIBILITY TO OFFSET TAX LOSSES AGAINST INCOME OF THE FOLLOWING YEARS

The Constitutional Court ruled on the challenge to Section 22 of Law 1607, which established the Income Tax for Equality (CREE)