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DIAN REVENUE RULING

Resources of trust companies cannot be used for paying the withholding tax on behalf of trusts when they do not own cash themselves

According to Article 102 of the Colombian Tax Code, the payment is not part of the tax obligations of trust companies and would exceed their legal capacity

 

Through Revenue Ruling No. 18970 of July 19th of 2016, the Colombian Tax Authority — DIAN—, determined that trust companies are not obliged to dispose of the economic resources for the compliance of tax obligations in charge of  the trusts they manage.

The Supreme Court on Administrative Matters, Section Four, in Providence Exp. 19913 of May 7th of 2014, determined that if there are no economic resources for the compliance of tax obligations, beneficiaries should comply with those obligations, not the trust company with its own assets.