Transfer taxes in Colombia, regulations and formal obligations required by the National Tax and Customs Directorate (DIAN)

In Colombian law, transfer pricing regulation is developed in the Tax Statute and in Decree 3030 of 2013. In which it is mentioned the supporting documentation to be submitted by the Colombian taxpayer to inform the National Tax and Customs Directorate (DIAN) if the operations carried out with foreign related parties, related parties located in free trade zones or with persons, companies, entities or businesses located, resident or domiciled in tax havens were agreed under the principle of full competition.

The Transfer Pricing regime is included in Articles 260-1 to 260-11 of the Colombian Tax Code and is regulated by Regulatory Decree 2120 of 2017. The regime has been in force since 2004; however, the mentioned decree came into force on January 1, 2017.

Obligated subjects

The subjects obliged to comply with the Transfer Pricing Regime and, therefore, keep supporting documentation are to send the Local Report and the Master Report:
Regarding the Country by Country Report (CbC), it is applicable for Colombian multinational groups with revenues over COP 2.3 billion. The CbC must be submitted in Colombia when local incorporated entities have a joint participation equal to or greater than 20% of the group’s consolidated revenues.

Formal obligations

Penalties for non-compliance

Penalties for transfer pricing documentation: