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NEW NOMINAL INCOME TAX RATES FOR INDIVIDUALS

New income tax rates for individuals depend on the category of income they receive: labor and pension income, non-labor income and income from dividends and shares

 

For the category of labor and pensions income, 4 progressive rates were implemented which range from 0% to 33%, as well as 4 withholding tax rates, from 0% to 33%.

Rates for individuals in the labor and pension income category:

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Withholding tax rates for the labor and pension income category:

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It should be mentioned that the non-labor income category is taxed with a progressive rate that goes up to 35%.

In the category of dividends, when dividends are distributed out of profits that were not taxed at the corporate level, they will be subject to withholding at a rate of 35%. The net dividend after subtracting this tax will be taxed again at a progressive rate from 0% to 10%.

Dividends out of profit that were taxed at a corporate level received by individuals’ tax residents in Colombia will be subject to withholding at a rate of up to 10%.

This regime is regulated in articles 5, 6 and 7 of Law 1819 of 2016.