Legal Bulletin



Operations among non–residents with permanent establishments in Colombia.

Revenue Ruling No. 001421 of October 20, 2015


DIAN upheld that withholding shall be applied to “internal operations” carried out between Colombian non-residents and their Permanent Establishment, since for tax purposes they are considered as different persons.

In addition, Section 30 of the Tax Code treats as dividends the transfer of profits considered taxable income or capital gains, between the permanent establishment and the foreign company.

With respect to the amount that shall be registered in the accounting, DIAN established that the adjustment made to the value of the operation is based on the arm’s length principle and shall be made in accordance with Decree 2649 of 1993 and 3026 of 2013.

Finally, with respect to the limit of deductibility set on Section 122 of the Tax Statute, DIAN sets that it is applicable.