Colombia Tax Rates
Colombia operates a progressive tax system administered by the Dirección de Impuestos y Aduanas Nacionales (DIAN). The country levies personal income tax through progressive brackets with a top rate of 39%, a 35% corporate income tax, and a 19% value-added tax. Colombia taxes residents on worldwide income and non-residents on Colombian-source income. The tax system has undergone several major reforms in recent years, including the 2022 tax reform that increased rates on high-income individuals and corporations.
Top Income Tax Rate
39%
Corporate Tax Rate
35%
VAT / Sales Tax
19%
Capital Gains Tax
15%
Detailed Tax Information
Income Tax Brackets
Colombia imposes a progressive personal income tax with seven brackets, ranging from 0% to 39%. The 2022 tax reform (Law 2277) added new brackets at 37% and 39% for high-income earners. The first bracket effectively exempts income up to 1,090 UVT (approximately COP 46.5 million annually). Residents are taxed on worldwide income, while non-residents are taxed at a flat 35% on Colombian-source income. Employment income is subject to monthly withholding. Deductions include pension contributions, health insurance, mortgage interest (limited), and dependents. Colombia also provides a 25% income exemption for employment income (capped at 790 UVT per month).
| Income Range | Tax Rate |
|---|---|
| COL$0 – COL$46.5M | 0% |
| COL$46.5M – COL$72.6M | 19% |
| COL$72.6M – COL$166.4M | 28% |
| COL$166.4M – COL$388.6M | 33% |
| COL$388.6M – COL$908.5M | 35% |
| COL$908.5M – COL$1516.2M | 37% |
| COL$1516.2M+ | 39% |
Corporate Tax
Colombia imposes a flat 35% corporate income tax on resident companies' worldwide income (increased from 30% by the 2022 tax reform). Non-resident companies are taxed at 35% on Colombian-source income. Financial institutions are subject to an additional surcharge of 5 percentage points (total 40%) through 2027. Companies in free trade zones enjoy a reduced rate of 20% on income derived from exports. Small and medium enterprises may benefit from progressive rates in their early years. Colombia uses transfer pricing rules aligned with OECD standards and has CFC rules for foreign passive income.
Standard Rate
35%
Capital Gains Tax
Capital gains in Colombia (ganancias ocasionales) are taxed at a flat rate of 15% for gains up to 13,000 UVT (approximately COP 598 million) and 20% for gains above that threshold. This includes gains from the sale of fixed assets held for two or more years, inheritances, lottery and gambling winnings (taxed at 20%), and gifts. Real property gains benefit from a presumptive minimum cost basis that is adjusted annually for inflation. Short-term gains (assets held less than 2 years) are generally taxed as ordinary income at progressive rates up to 39%.
Short-Term Rate
15%
Long-Term Rate
15%
Rate
15%
VAT / Sales Tax
Colombia levies a 19% value-added tax (IVA) on most goods and services. Essential goods including basic foods, medicines, and agricultural inputs are excluded or zero-rated. A reduced rate of 5% applies to processed foods, hygiene products, and certain capital goods. Exempt services include health, education, public transportation, and financial services. Colombia also imposes a national consumption tax (Impuesto Nacional al Consumo) of 4-16% on restaurants, mobile phone services, and vehicles. Bimonthly IVA returns are required for most businesses.
Standard Rate
19%
Cryptocurrency Tax
Colombia does not have specific cryptocurrency tax legislation, but the DIAN has issued guidance clarifying that crypto assets are subject to existing tax rules. Income from cryptocurrency trading is treated as ordinary income and taxed at progressive rates up to 39%. If crypto assets are held for more than 2 years, gains may qualify for capital gains treatment at 15%. Crypto holdings must be reported in the annual tax return as part of net worth. The Colombian tax authority has been increasing its monitoring of crypto transactions through information exchange with local and international platforms.
Tax Treaties
Colombia has approximately 15 double taxation agreements in force, a network that has been growing steadily. The treaties typically reduce withholding rates on dividends, interest, and royalties. Colombia does not have a comprehensive tax treaty with the United States but has a Tax Information Exchange Agreement. Colombia is a member of the OECD (joined in 2020) and participates in the BEPS Inclusive Framework. The country exchanges information under the Common Reporting Standard (CRS) and has adopted OECD transfer pricing guidelines.
Treaty Network
15
Double taxation agreements
Major treaty partners:
Key Details
Relocate to Colombia
See how much you could save by moving here from your current country.
+$16K
Tax in United States
$24K
24.4% effective
Tax in Colombia
$8K
8% effective
You Save
67.2%
less tax annually
US Citizens: Important Note
US citizens are taxed on worldwide income regardless of residence. You'll still need to file US taxes, though the Foreign Earned Income Exclusion and Foreign Tax Credit may reduce your liability.
