AM I BEING TAXED OUT OF COLOMBIA?

lochdhu says on May 21, 2007, 16:17:

Best to pony up the money, and consult with a tax professional in which your money comes from, and a tax prosessional in colombia.

0 funny, 0 helpful.

CaritadeAngel says on May 21, 2007, 16:20:

Yes, you need a tax lawyer what about our lawyer friend who post here sometimes? Can he help on this one?


"Nolite id cogere, cape malleum majorem."

"I hope I never say anything worth quoting".

0 funny, 0 helpful.

fecherklyn says on May 21, 2007, 16:59:

Tax Lawyer Thanks for the suggestion. Yes, its seems obvious doesn't it, the question is complex...so find a specialist.

The problem is my experience is it is very difficult to find any good consultants with experience of international practice (having already wasted too much money on people who eventually knew less than me).

In most other countries I would expect to find government websites where you can research your queries....but do they exist here?

0 funny, 0 helpful.

Robert Jorge says on May 21, 2007, 17:31:

A guy who posts here regularly should have some good answers. His name is Gator. Maybe he'll see this and respond.

BEWARE of gold diggers.

0 funny, 0 helpful.

Brians says on May 21, 2007, 18:20:

Good post as these questions need to be answered in my mind as well. I do know there in a govermental site that lists the varous rates. Now my question is since Colombia does not have a treaty with your country how will they even find out your worldwide earnings? I believe unless you show it they won't see it. However I am curious to hear from someone who actually knows the answer exactly and I believe Gator is the man.

0 funny, 0 helpful.

adrimm says on May 21, 2007, 18:36:

Edit: I don't know but I Edit: I don't know but I just did some googling and this is what i came u with.... but sounds like you all have a good handle on it anyhow.

Google: "doble nacionalidad" + impuestos + colombia =

http://www.consulcolatl.com/servicios/nacionalidad.htm
Scroll to the bottom and you find this tidbit:

TRIBUTACION

Cuál es la situación inherente a las obligaciones tributarías que deben cumplir las personas naturales nacionales, que han renunciado a su nacionalidad colombiana?

Las personas naturales nacionales o extranjeras, residentes en el país, están sujetas al impuesto de renta y ganancias ocasionales tanto de las rentas de fuente nacional como extranjera.

Para los extranjeros residentes en Colombia, sólo están sujetos a este impuesto cuando es de fuente extranjera a partir del quinto año de residencia continua o discontinúe en el país. (Residencia, para efectos fiscales, consiste en la permanencia continua en el país por más de seis meses en el año o periodo gravable, o que se completen durante el año, es decir la permanencia discontinúa).

Y las personas naturales que conserven su familia o el asiento principal de sus negocios en el país, aún cuando permanezcan en el exterior, se consideran residentes.

En conclusión, la persona natural que renuncie a la nacionalidad colombiana, continuara tributando sobre las rentas de fuente nacional a titulo de impuesto de renta y complementarios, y sobre sus rentas y bienes del extranjero a partir del quinto año según las reglas generales contempladas en el Estatuto Tributario (artículos 7, 9 y 10).

.
.
.
.

So the best place to inquire about this tax would probably be with DIAN http://www.dian.gov.co/ . I'm guessing that as dual citizen, you'll be taxed at the same rates as a Colombian with foregn income would be. They probably have the stuff buried somewhere online, but I'll leave it to you to find (or just call them).

Other useful government websites:

http://www.gobiernoenlinea.gov.co

http://www.presidencia.gov.co/prensa_new/index.htm

.
.
.
Also have you tried the British Embassy? They may be able to help, or at least point you to something useful.

0 funny, 0 helpful.

Gator says on May 21, 2007, 21:40:

First... forget the attorney and seek the advice of a good Contadores Publicos (CPA). Most are well versed in Colombian tax requirements.

1. If you are a PERMANENT resident for five years foreign income becomes taxable.

2. While there are some Andean countries tax treaties in effect basically your country of nationality has nothing to do with your taxes. COLOMBIAN tax law will apply. If you have a Colombian business or your family lives in Colombia and you do not the five-year rule will still apply
3. Foreign residents are generally only initially liable to tax on Colombian-source income. However, after five years of residence, foreign residents will also be taxed on foreign-source income. Foreign residents and non-residents must pay 34% income tax during 2007 and 33% with effect from tax year 2008.

4. What is taxable? Most income is subject to taxation, including capital gains. Surprisingly, proceeds from the sale of shares through the stock exchanges are not considered occasional earnings and are thus tax-exempt. Interest paid to authorized financial entities on housing loans is deductible and is calculated in terms of an indexed accounting unit, up to 1,000 units annually. There is a 60% deduction for qualifying donations and a 100% deduction for donations to entities or programs approved by the National Council for Science and Technology.

What are the tax rates? Personal tax rates for taxable income and are for 2007)

Monthly in COP Tax payable
0–1.090.000 0%
1.091.000–1.700.000 19%
1.701.000–4.100.000 28%
4.101.000 and above 34%

The following is a tax calculation is based on an individual earning 120 million COPs per year (roughly US$60,000).

Gross income 120.000.000
Less credit for mortgage interest 19.500
Taxable income 118.799.805
Tax payable
on first 35.609,900 (19%) 6.766.000
on 35.609.900 to 85.882.700 (28%) 14.076.000
on remainder 34.117.300 (34%) 11.599.882
Total tax payable 32.441.882
Tax as a % of gross income 23.3%

THE BEST PLACE TO GET YOUR NEEDED ADVICE IS FROM A CONTADORES PUBLICIOS THE COMPARATIVE SMALL AMOUNT YOU WILL PAY WILL BE WELL WORTH IT.

psstt: You did not here this from me but what they don't know will not hurt them, I mean you.


"Brevior Sltare Cum Deformibus Mulieribus Est Vita!" .

"Credidi pretio parvo emere et magno vendere tibi in animo fuisse!" .

0 funny, 0 helpful.

lochdhu says on May 21, 2007, 22:59:

Gator, Thanks thats some great info to have. you are a wealth of information.

so let me get this right, If I keep a couple of seperate ATM cards and withdraw my money from my us bank , I wont have any problems after 5 years will I?

0 funny, 0 helpful.

Brians says on May 22, 2007, 04:28:

Good stuff Gator and one more question If you own Colombian real estate from what I understand they assume a 6% income on the value. Is this assumed on a primary residence? For example I own an apartment in Medellin now. Do I pay a income tax on an assumed rental flow of 6% even if it is not rented and is my only property? If I buy a second property I would assume that thisis the case but what about a primary residence? Thanks for all your advice.

0 funny, 0 helpful.

elk says on May 22, 2007, 04:30:

Gator: Foreign income Gator, you state "Foreign residents are generally only initially liable to tax on Colombian-source income. However, after five years of residence, foreign residents will also be taxed on foreign-source income."

I would like to know what Colombia defines as "Income". I was speaking with a lawyer last evening who told me that Colombian pensions were not taxable. He had no idea if a foreign pension would be taxable such as social security paid by the U.S. government. I agree, it's best to ask and accountant, but where do you find a reliable account? Even Dian offers conflicting information. I would prefer to see the written law myself. In the U.S. we have a printed tax code, but I have been unable to find anything similar to a tax code here in Colombia.

I'm in the process of changing from the Pensionado visa which I currently hold to some other type.

0 funny, 0 helpful.

Brians says on May 22, 2007, 04:42:

elk did you look on the DIAN site? What other type of visa are you applying?

0 funny, 0 helpful.

aztec says on May 22, 2007, 05:29:

Don't forget you will... ...also be required to file a US return in addition to pay Colombian taxes.

I have sought legal/tax advice from some of the better professionals in Colombia. Frustratingly, I have received contrasting advice on the matter of pension and Social Security counting as income for Colombian taxes.

As most of you know you already pay US taxes on Social Security and most pension income. In addition, depending on your State residency, you will also pay State taxes on this same money. The only way around this is to surrender your US citizenship.

There is also that tax on Patrimonio. A form of “wealth”tax imposed annually on net worth (house, car, bank accounts, shares, etc.). It doesn't take much for this item to show up as a problem. There is a poster on this site who has several million (in dollars) invested in Colombian real estate.This tax along with "after five years of residence, foreign residents will also be taxed on foreign-source income" convinced him not to become a resident. He, therefore, never remains in the country over the 6 month period.

0 funny, 0 helpful.

Brians says on May 22, 2007, 05:57:

Aztec really interesting but how would Colombia even know what investment or pension income you have in the US? They have no tax treaty and as far as ELK is concerned he need only show the minimum amount necessary to maintain his visa. Unless my 1099 is somehow passed along to the Colombian goverment which it is not why would I even show my american sourced income. The only visa requiring showing of income is the pensionado therefore they would never know. Colombia can not get the information to know what my income in the US is unless I show them.

0 funny, 0 helpful.

chico-bill says on May 22, 2007, 06:09:

Keep it in your home bank and witdraw from ATMs If you are needing to get cash only just have your retirement checks deposited to you UK or US banks and use your ATMs to withdraw cash - I use this and never bring roo much money for deposit in Bogota. I can not imagine depositing several hundreds of thousands of euros in Colombia right now. Maybe in a few years yes - for things are changing rapidly and beoming more stable - I hope

As for Patrimonio that is a part of life. Consider it property tax wherever you live it is the same - except the Dominican Republic and that will probably change too

0 funny, 0 helpful.

cayita says on May 22, 2007, 06:12:

when you opened a bank account what papers did you give them to verify income? If you don't open a bank account I wonder too how they would know? But I am no expert.

0 funny, 0 helpful.

elk says on May 22, 2007, 08:58:

Brians: Dian Site y visa type Brians: Yes, I looked at the Dian site but found nothing to address my question of Social Security/retirement income from the U.S.

I guess one option would be the rentista visa showing $24,000 or $2,000 income from a U.S. bank. This however creates another problem with the patrimonio tax if you own a home in Colombia. The $24,000 plus the value of your home will be above the 80,000,000 COP limit.

Having a pensionado visa has two problems. One, your probably taxed after five years on your income amount and number two your medical insurance is based on your income. In my case medical insurance is over 600,000 COP per month. MRE knows the exact amount of your pensionado income since they required proof of your income at the time of application.

I will probably give some thought to the marriage visa which apparently doesn't require an income statement. I will need to renew my Pensionado visa in July and will be making a decision soon.

Thanks to everyone for the information....

0 funny, 0 helpful.

Atrevido says on May 22, 2007, 09:21:

Patrimonio Tax Elk I think the patrimonio tax is EITHER eighty something millions in bienes (house, car) OR more than sixty something milliones in income. I don{t believe the two are combined. You can divide up ownership of house/cars with your wife to keep the numbers down. I am stunned by the idea that my pension income from the US could be taxed in both countrys!

0 funny, 0 helpful.

jnlondon says on May 22, 2007, 10:54:

I'm not sure about Britain, but the US has a foreigned earned income exclusion(study here http://www.irs.gov/faqs/faq13-3.html). So if you, for example, are physically present in Colombia 330 days out of the year, you can exclude around $80K of you income from US taxation. I would assume this applies to pension income but I don't know for sure.

0 funny, 0 helpful.

nine inch nails says on May 22, 2007, 11:49:

Try Uruguay o Argentina if you can A recent Miami Herald article in the Money section (4/22/07) lists several Latin and South American countries and the pros/cons of retiring in each. It lists both AR and UR as those that do not tax outside income. Nicaragua also I read.

They have no mention of CO but maybe the author (email: jmailander at MiamiHerald.com) may know something.

"They know nothing, they know nothing." J. Cramer

0 funny, 0 helpful.

Miguel_Clavo says on May 22, 2007, 11:49:

Suggested reading: The Expatriates Tax Bible... by Richard Leonard...

Just my opinion...

Miguel_Clavo =)..aka, DragonSlayer..2-0..Colombia es pasión!

"I would rather die living life, than to live a dying life."........ Oh, and my PM is always ON. Great Bumper Sticker: "Home of the Free, Because of the Brave"

0 funny, 0 helpful.

griffbos says on May 22, 2007, 12:33:

check this site http://www.deloittetaxguides.com/index.asp?layout=countryGuideDtt&country_id=1510000151#minorA24

it has info on varies taxes here is part of what they have

6.2 Taxable income and rates
Individuals are subject to personal income tax, at a top rate of 34% (33% with effect from 2008). Non-formal employment contracts are subject to a 3.5–10% rate. Individuals with a net worth of Ps3bn or more are subject to a tax of 1.2% of assets with effect from January 1st 2007.

Most residents in Colombia need not file income tax returns unless their income or total worth exceeds a limit imposed annually by the government. For those who do not file returns, their taxes are deducted at source by the employer. If a return is required, it must be filed between February 2nd and May 30th 2007, depending on the last two digits of the taxpayer’s identification number.

Taxpayers can apply discounts for education or health expenditure or for the payment of credits or the initial downpayment for housing, up to 30% of taxable income. Discounts are limited to workers earning up to Ps7.34m per month.

The National Administrative Statistics Department adjusts tax rates each year by a percentage based on the October-to-October increase in the consumer price index.

Personal tax rates, 2007
Taxable income (UVTs*, 1 UVT=Ps20,947 for 2007) Tax payable
0–1,090 0%
1,091–1,700 19%
1,701–4,100 28%
4,101 and above 34%

The following sample tax calculation is based on an individual earning Ps140m per year (roughly US$60,000).

Ps m
Gross income Ps140,000
Less credit for mortgage interest 19,500
Taxable income 120,500
Tax payable
on first Ps35,609,900 (19%) 6,766
on Ps35,609,900 to 85,882,700 (28%) 14,076
on remainder Ps 34,617,300 (34%) 11,770
Total tax payable 32,612
Tax as a % of gross income 23.3
* The 2006 tax reform created a new tax value unit, which will be used to establish withholding tax payments. This will change each year to reflect changes in the consumer price index

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 15:03:

Firstly, thanks to all of you who have replied to this thread (particularly Gator who is evidently our resident expert). From the varied responses it is clear there exists a certain “mystique” about this whole subject and that many of us share a frustration about getting clear, official rulings. My wife has just spent over 2 hours on the phone to the DIAN and has been shunted back and forth between 11 unsure persons before falling on one officer who was adamant that “only incomes derived from an activity in Colombia are liable to Colombian taxation and, thus, foreign pension incomes are NOT taxable in Colombia”.

Rather than breaking open a bottle of champagne my wife thought it prudent to ask this officer how his statement could be consistent with other information we have received suggesting permanently resident foreigners (5 year rule) would be imposed on their world-wide incomes whatever their source. The initially friendly attitude immediately became frosty and she was referred to the judicial division. Yes, you have guessed, the judicial division refuse to answer queries from individuals.

Thus, despite making some headway I personally would like some further answers. In particular, I noted that a number of you wonder “why worry…if you do not declare your world-wide incomes…who is to know?” Well, in short, I cannot live like that, not sure whether I am cheating and always fearing disclosure sooner or later.

For these reasons I have prepared several other messages which will follow this one. Each of these messages deals with a different aspect of this problem. Eventually I shall certainly need a specialist consultant’s assistance (if I can find such a person) but in the meantime I will welcome any further comments/recommendations you may wish to give.

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 15:04:

Some of the previous messages have asked questions about the “Wealth (Capital) Tax”. On this (and other aspects) I found the following site useful:

http://www.vaaya.com/documentation/taxes.pdf

In short, it would appear very few of us are going to be worried about this tax as the net worth has to exceed 3,183,000,000 COP before it is taxable ( at 0.3%).

Brians ask in one of his messages if the primary residence should appear in the taxable value. It would appear “Yes” but only for that part of its value exceeding 200 million COP (in 2005).

Of course, although people are only going to be taxed when they have assets exceeding 3 billion COP this does not mean there is not a responsibility to declare one’s assets. Atrevido is correct I understand when he says assets must be declared once they exceed in the region of 89 million COP.

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 15:06:

Elsewhere, I noted someone queried if there could be difficulty in repatriating asset sales proceeds out of Colombia. For example, if I decided to leave Colombia and sell my house, would I be allowed to transfer the full sales proceeds out of the country without penalty?
This question is addressed in the link http://www.vaaya.com/documentation/taxes.pdf but unfortunately it leaves me with some residual questions.

Essentially, the above link states that foreign investors (that’s us I think?) are entitled to free repatriation of liquidated investment. So far so good, but it then goes on to say Colombian law forbids the government to modify exchange rights that foreign investors are entitled to WHEN THEY REGISTER THEIR INVESTMENTS BEFORE THE CENTRAL BANK.

I’m not quite sure what this last piece means but I fear it might mean trouble if, say, I, a British subject, purchased a property and did not think to register it as an investment as a foreigner.
I will try to research this further but if anyone has any information please let me know.

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 15:09:

Finally, the major subject, The taxation of the world-wide incomes of resident foreigners.

Gator. Thanks for the progressive tax rates though to the marginal 34%. However, I am a poor mathematician and I did not understand the computation. It would appear the first 1,090,000 COP per month (= 13,080,000 COP per annum?) is tax free and then the next 2,399,000 COP per month (from 1,701,000 to 4,100,000 per month) is taxable at 19%. This seems to suggest the first tranche of incomes to be taxed will be 28,788,000 COP at 19%. How does one explain the 35,609,900 COP at 19% in the model calculation?

After that it would appear necessary to obtain confirmation the DIAN intends
-all world-wide incomes to become taxable in Colombia (it would appear “Yes” according to Gator and other sources) but direct approaches to the DIAN have not confirmed this.

-the definition of world-wide incomes to include pension revenues.

The last question is of course the key. Does Colombia intend to tax ( at 34%) the pensions of resident foreigners despite the fact the underlying employment was performed elsewhere and the pension payments are effected by foreign institutions abroad? In this latter respect I am even unsure if COLOMBIAN PENSIONS ARE TAXABLE? Most people I have spoken to immediately tell me that pensions are NOT taxed in Colombia. If this is the case, how could they justify the taxation of overseas pensions they have had no involvement with?

The question of double taxation of pensions has been mentioned. According to my researches so far there are few, if any, double taxation agreements that can protect us from this practice. There exist agreements with USA, Argentina, Chile, Brazil, Italy, Venezuela and the Andean Pact countries. However, so far I have not seen that any of these deal with the avoidance of double taxation on incomes such as pensions.

0 funny, 0 helpful.

aztec says on May 22, 2007, 16:15:

WHEN THEY REGISTER THEIR INVESTMENTS BEFORE THE CENTRAL BANK. fecherklyn, As a foreigner that is why you file Form 4 and 11 when you invest in real estate in Colombia.

To be the devils advocate, I could make the case that if your pension and Social Security is taxable in the United States then logically it would be taxable in Colombia after 5 years of residency.

I will be surprised if you ever get a definitive answer to your question about whether they are taxable or not. The fact the individual became irritated leads me to believe he was flying by the seat of his pant. My wife and I have run into this attitude time after time.

0 funny, 0 helpful.

elk says on May 22, 2007, 17:03:

Fecherklyn: Double taxation You posted: "The question of double taxation of pensions has been mentioned. According to my researches so far there are few, if any, double taxation agreements that can protect us from this practice. There exist agreements with USA, Argentina, Chile, Brazil, Italy, Venezuela and the Andean Pact countries. However, so far I have not seen that any of these deal with the avoidance of double taxation on incomes such as pensions."

Your asking some good questions relating to the Pensionaldo Visa and related tax by Colombia.

I recall in my earlier research that Colombia doesn't engage in double taxation. I will attempt to find the document. Like others I have received many conflicting answers from DIAN.

I would like to find "hard copy" from a Colombia tax guide rather than taking someones opinion. (in this case DIAN) This subject is probably covered by Colombian law, but finding it is the problem. Hopefully with enough interest someone will be able to help us.

I currently hold the Colombian Pensionado visa like many others here on PBH and have found the Colombian government to be very flexible when it comes to their legal requirements for the visa. Maybe they will be flexible when it comes to taxing our foreign pensions. Again, I spoke with a Colombian attorney last night, who stated "a Colombian pension is not taxable". I have a retired Colombian police friend who confirmed the same. You might assume from this all types of Pensions, foreign or national, aren't taxable. ????

I'm hoping in the near future Colombia will adopt the same or similar rules as Panama when it comes to foreign retirees. This would be an advantage for both Colombia and the foreign Pensionado.

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 17:23:

That was a bomb about the Form 4 and 11. Nobody mentioned anything about this when we purchased our house and finca.

But I wonder how this works? Our properties were purchased with monies brought in from abroad after satisfying the banks regarding their source. Then our purchases were made in joint names; me a foreigner and my wife a Colombian. I suppose this means 50% of the investment was made by a foreigner? Anyway, 100% of the funds came from abroad. I will try to check with my bank.

Didn't fully understand your devil's advocate remark. Why do you think that if pension and Social Security is taxable in the USA it would be logical that it should also be taxable (after 5 years) in Colombia?

That a USA pension and Social Security should be taxable in the USA goes without saying (Pension originates from activities in the USA and is paid from USA institutions). However, this will always be the case. It is not because you are now resident in Colombia that the USA will forego their tax rights on these payments. So if Colombia also taxes the same payments this will establish a "double taxation" (from which it has yet to be determined if you can get any tax relief by virtue of international agreements).

So, how do you reason it is logical for Colombia to tax your USA pensions?

0 funny, 0 helpful.

Brians says on May 22, 2007, 17:49:

Fecherklyn you needed to file the Form 4 and 11 this is a big issue that will be time consuming to work out but at least it sonds like you will have plenty of time. I would immediatly save all documents of the wire of monies and the settlement of the real estate. I would not even venture to say how to correct this but I have read places where it was with the help and expense of a lawyer. Anyway the form 4 declares the money and the bank files it. Since you did not ask the bank to do so they probably did not. The Form 11 is filed with the goverment within 3 months of settlement of the property. You will need this information if you decide to sell and bring the money back from Colombia.

As far as the pensions mentioned above think about it this way. You are exempted from paying US taxes on foreigned sourced income from the US up to $80,000 a year. However 401ks etc are not earned in the years you are in Colombia and thus not sourced income. Therefore there is no avoidance f the US tax. I really believe that there is no tax by Colombia but understand your concerns. It would be bad to wake up one day owning a lot of Colombian taxes but I would tell youhow will they ever find out outside of sueing you in a US or in your case British court to turn over your 1099s and tax returns in those countries for those repective years. The US does turn over your information to foreign goverments.

0 funny, 0 helpful.

fecherklyn says on May 22, 2007, 18:34:

Hi Brians, thanks for your reply. It sounds like I will have my work cut out regarding the Forms 4 & 11 as our purchases were made several years ago. Here's hoping the authorities are understanding about a simple mistake.

Still a bit lost about your remarks on exemption from paying US taxes and 401's but then I am British. I think I can bewilder you on European tax law. What does seem clear is that our countries of domicile where we are submitting tax declarations on incomes sourced there (USA for you, Britain for me) will exchange info's with a country of residence (Colombia in both cases) IF INTERNATIONAL TREATIES EXIST BETWEEN THESE COUNTRIES. Thus it is important to reflect before simply deciding not to declare world-wide incomes whether or not they could obtain the info from the "source" country.

I still think it is necessary to obtain FORMAL confirmation from the DIAN as to whether or not foreign pensions paid to foreign residents will be taxable in Colombia. I am going to write about this to DIAN with the British Embassy and everyone else I can think of in copy. Maybe you USA pensioners resident in Colombia should do the same?

0 funny, 0 helpful.

aztec says on May 23, 2007, 05:30:

fecherklyn "Why do you think that if pension and Social Security is taxable in the USA it would be logical that it should also be taxable (after 5 years) in Colombia?"

In my case money funding my pension was contributed prior to any State and Federal income taxes. That means when I withdraw funds from my pension it becomes taxable at my current tax rate. Thus, it is reported along with any other income on my Federal Return.

While I certainly hope Colombia will not tax any of this pension, I can understand why they would insist it be considered as untaxed money.

On the matter of funds for your real estate purchases, I will bet you the bank filed Form 5 on the transfer. As advised by Brians, I would try to get the records straight on this matter. Keep all records, visit the authorities and work it out.

Don't make the mistake of assuming the authorities will not know about the transfer. Viewpoint and I both have received letters two years after the transaction.

In viewpoints case he was obligated to pay a fine. My wife is in Bogotá at this very moment meeting with them in an attempt to resolve the misunderstanding.

Of course if you never have any intention of repatriating these funds then just sit tight and don't worry about it. You have no problem.

0 funny, 0 helpful.

elk says on May 23, 2007, 06:12:

Colombian tax guide The Colombian tax legislation provides for several tax credits. The most important are described below:

(1) Taxes paid abroad: National Colombian tax payers that
receive foreign income subject to taxes in the foreign country, can
discount from the income tax to be paid in Colombia, the amount paid for taxes abroad for such revenues. The discount can not exceed the tax that must be paid in Colombia


Colombian tax guide in PDF format
http://www.lexmundi.com/images/LexMundi/PDF/tax-Columbia.PDF

0 funny, 0 helpful.

aztec says on May 23, 2007, 07:30:

I read that to mean... ...we would not pay any taxes in Colombia on any foreign income.

0 funny, 0 helpful.

Atrevido says on May 23, 2007, 19:07:

If that site is correct (emphasis on "if") then it sounds like you would have to present a copy your US income tax return (oh no! more apostilles, translations etc.?) and if the Colombian tax rate is higher you would still have to pay the difference to Colombia.
Regarding how does Colombia know what your pension is well that´s precisely the information you´ve submitted each year for the last five years to the Ministry Of Foreign Relations to obtain your Temporal TS Pensionado visas.

0 funny, 0 helpful.

Monita Linda says on Jun 1, 2007, 03:33:

My boyfriend (soon to be husband) is accountant. He lives in Cali and is reliable. I don't know where you live in Colombia but if its Cali maybe you could consult with him. He is quite busy working for a large international firm but who knows. He speaks fluent English.
Get in touch with me when interested.

0 funny, 0 helpful.

calipro says on Jun 3, 2007, 12:18:

Too honest for your own good...... There isn't a colombian business owner that I know that pays taxes the way he should.

If I were you I would pay the income taxes in the country were it is earned and that is it. Just keep the money in a bank in the country of origin and withdraw it through ATM transaction and never put it in your Colombian bank account.

The money you earn in Colombia you can put in your Colombian bank account and pay tha appropriate taxes.

0 funny, 0 helpful.