Tax Bulletin No. 3

We share our Tax Bulletin No. 3  from the 1st to the 15th of August 2018 with the latest decisions and opinions released by the Council of State and the Tax Authority, in connection with national and local taxes, and tax procedure.

The complete Bulletin is found only in Spanish in the below PDF, because of many domestic tax terms we are unable to translate for you. However, please find below the main subjects we will be speaking of in the Bulletin. If you are interested to find out more information, do not hesitate to contact us.

1. DIAN press releases

1.1 In the press release of August 5th, 2018, DIAN required taxpayers, who issue electronic invoices, to update their tax identification, for which they must include the duty code number 37.

2. Administration Acts

2.1 In the Decree 1453 of August 6th, 2018, the Government ruled the proceeding by which the fiscal recognition would be applicable for incomes, costs, deductions, assets and liabilities that were registered and valued in foreign currency within the Financial Statements.

2.2 In August 3rd, 2018, the Government issued the Decree 1415 and established that foreign entities and non-tax residents that provide services in Colombia, from abroad to Colombian residents, must obtain tax ID (RUT), collect and pay the VAT related to this type of transactions.

3. Judicial Decisions

3.1 In the Decision of June 21st, 2018, the Council of State explained that the Tax Administration Acts are not enforceable to the taxpayers if those Acts are being challenged before the Contentious Administrative Jurisdiction.

4. Tax Rulings

4.1 In June 19th, 2018, DIAN issued Tax Ruling number 912 regarding many aspects of the Income Tax for individuals considered as residents and non-residents, as well as the withholding tax applicable to individuals.

4.2 In Tax Ruling number 615 of April 30th, 2018, DIAN said that if a foreign entity has a PE in Colombia, the PE is liable to pay the VAT to the Tax Authority. Conversely, when a foreign entity does not have PE in Colombia, the buyer of the service would be the one liable of the mentioned obligation.

4.3 In Tax Ruling number 10610 of April 25th, 2018, DIAN reiterated that trusts would not be subject to income tax if the revenues attributable to the trust are taxed at the beneficiaries' level. Otherwise, when beneficiaries are not determined, the trust would be subject to the income tax.