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Post by sedelen on Jul 7, 2016 15:39:57 GMT -5
The time is coming, to file or not to file Colombian taxes. I don't know much about the laws here, especially when it comes to taxes. What I do know is that I may be expected to file before August after spending over 183 consecutive days here. And so it is, not knowing much I have asked other expats about filing, and I get this deer in the headlights look from them, asking, "Why would you want to do that?" So, I assume that most others don't file for whatever reason suits them.
I'm here on a TP-7 Visa, and I don't have any income here from anything. I have absolutely no Colombian interests, real estate, bank or any other Colombian financial institution. I don't own any businesses, or anything else. I do own a car.
I guess that brings up the question of the "Worldwide Income" thing. I wonder how much liability I may have to be expected to pay "who knows what?" And that does not make me feel comfortable not knowing what, or how much I could be expected to pay.
So, I appeal to anyone out there on advice on this subject, as you are the wizards that know best. Thanks in Advance!
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Post by Deleted on Jul 7, 2016 20:56:19 GMT -5
Well, if you have no intention of filing, then don't worry about it. Many ex-pats have convinced themselves that their income and personal assets are exempt, and probably won't be filing... so you will have plenty of company. But as Clint Eastwood would say: "Do you feel lucky today."
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Post by sedelen on Jul 7, 2016 21:18:50 GMT -5
Well, if you have no intention of filing, then don't worry about it. Many ex-pats have convinced themselves that their income and personal assets are exempt, and probably won't be filing... so you will have plenty of company. But as Clint Eastwood would say: "Do you feel lucky today." Thanks, I bet Hillary could get away with it!
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Post by papitohead on Jul 7, 2016 21:30:06 GMT -5
Now that you mention it, I thought the political corruption was bad in PR and Colombia, but with the Hillary fiasco is leading me to believe that she is worst that here. She clearly brakes the law and gets away with it. She feels that the law is just for the poor.
I don't know nothing about the Colombian tax law. I do have a finca but I do pay taxes there. I will never work there and have no other assets there. I keep my $ in the US. So I do not know if I am doing the correct thing or what.
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Post by makopp5 on Jul 8, 2016 6:38:23 GMT -5
If you have more than 120 million in assets (predial from a finca on your name for example) or more than 35 million of income you have to declare, what not means you have to pay something. Best way to talk to an accountant.
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Post by papitohead on Jul 8, 2016 9:23:27 GMT -5
You mean besides paying property taxes on my finca, I also have to pay luxury taxes? The only income I have is my Social Security and that stays in my US bank. I just draw from it in Colombia, My 401k and stocks I only draw when need money. All stays in my US bank.
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Post by sedelen on Jul 8, 2016 10:10:29 GMT -5
If you have more than 120 million in assets (predial from a finca on your name for example) or more than 35 million of income you have to declare, what not means you have to pay something. Best way to talk to an accountant. 35 million, if in dollars is quite a bit, 35 million if in pesos is not much at all, that would be about all you could expect to live on, and have a decent quality of living, more of an existence per se. I imagine a lot of people hit that mark. I don't have any finca or real estate, just a car.
There is one person I can call I think, but I can already hear his answer, "Why would you want to do that?"
Mainly because I try, I mean I really try to be law abiding, but here I've been flying to a point, under the radar.
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Post by Deleted on Jul 8, 2016 11:26:16 GMT -5
If you have more than 120 million in assets (predial from a finca on your name for example) or more than 35 million of income you have to declare, what not means you have to pay something. Best way to talk to an accountant. 35 million, if in dollars is quite a bit, 35 million if in pesos is not much at all, that would be about all you could expect to live on, and have a decent quality of living, more of an existence per se. I imagine a lot of people hit that mark. I don't have any finca or real estate, just a car.
There is one person I can call I think, but I can already hear his answer, "Why would you want to do that?"
Mainly because I try, I mean I really try to be law abiding, but here I've been flying to a point, under the radar.
[br Flying under the radar is probably not a very good strategy anymore. Colombia needs money and they know who you are and how long you have been here. I personally recommend that you get a qualified professional(not always easy to find) to help you.
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Post by papitohead on Jul 8, 2016 11:41:11 GMT -5
You mean they can tax my social security? They know I receive and how much because my first visa was a pensionado visa. Colombia government should be glad just because we spend our retirement money there. Taxing something we do not earn in Colombia would drive expats out.
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Post by livinginmedellin on Jul 8, 2016 11:41:37 GMT -5
If you have more than 120 million in assets (predial from a finca on your name for example) or more than 35 million of income you have to declare, what not means you have to pay something. Best way to talk to an accountant. 35 million, if in dollars is quite a bit, 35 million if in pesos is not much at all, that would be about all you could expect to live on, and have a decent quality of living, more of an existence per se. I imagine a lot of people hit that mark. I don't have any finca or real estate, just a car.
There is one person I can call I think, but I can already hear his answer, "Why would you want to do that?"
Mainly because I try, I mean I really try to be law abiding, but here I've been flying to a point, under the radar. It's actually 39.59 million pesos for gross income (that is worldwide income) or net worth of 127.255 million pesos for assets for 2015. If you are considered a Colombian resident for tax purposes, you are NOT required to file income taxes in Colombia if the following requirements (for 2015) are met: 1. Gross equity (net worth) on the last day of 2015 does not exceed 4,500 UVT, which is 127,255,500 pesos ($40,405 USD at official exchange rate at end of 2015). 2. Gross income in 2015 is less than 1,400 UVT, which is 39,590,600 pesos ($12,751 USD). 3. Credit card consumption in 2015 does not exceed 2,800 UVT, which is 79,181,200 pesos ($25,141 USD). 4. Total value of purchases and consumption in 2015 does not exceed 2,800 UVT, which is 79,181,200 pesos ($25,141 USD). 5. Total value of accumulated bank savings, deposits or financial investments held at the end of 2014 does not exceed 4,500 UVT, which is 127,255,500 pesos ($40,405 USD) That’s a pretty small number for gross income level for requiring filing income taxes in Colombia – only $12,751 USD. So I expect that most expat residents should have to file taxes in Colombia.But keep in mind in Colombia you can deduct income taxes paid in another country from your income taxes due in Colombia. Last year I paid no income taxes in Colombia for 2014 as I paid more income taxes in the US than what I owed in Colombia. This year I will have to pay some income taxes in Colombia as I married last year (paid less income taxes in the US) and the exchange rate increased, which pushed more of my US income into higher Colombia tax brackets. Note I understand there is a penalty for not filing income taxes in Colombia even if you don’t owe any taxes. And if you don’t file and owe taxes there is an even a bigger penalty. I am meeting with my Colombian accountant next week about my taxes and I’ll ask what the penalties are for not filing.
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Post by papitohead on Jul 8, 2016 11:48:18 GMT -5
Excellent post livinginmedellin. Please follow up after seeing the accountant. That will be a great help for many of us. Should I pay taxes for my Social Security received in the States,not in a Colombian bank? interesting.
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Post by livinginmedellin on Jul 8, 2016 11:54:42 GMT -5
Excellent post livinginmedellin . Please follow up after seeing the accountant. That will be a great help for many of us. Should I pay taxes for my Social Security received in the States,not in a Colombian bank? interesting. Sure I'll ask about Social Security.
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Post by dandl93 on Jul 8, 2016 12:30:23 GMT -5
This does not go for everyone but you that are from the USA.Stop thinking like a american when doing taxes in Colombia.Get a good Colombian accountant and check them out all the way. I went thru 5 before I found the one I use.Very few of you will have to pay any taxes in Colombia but the fines suck for not filing.
You dont file with your wife in Colombia you file seperate, If you own a home together you claim half of the value
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Post by Deleted on Jul 8, 2016 12:35:39 GMT -5
This does not go for everyone but you that are from the USA.Stop thinking like a american when doing taxes in Colombia.Get a good Colombian accountant and check them out all the way. I went thru 5 before I found the one I use.Very few of you will have to pay any taxes in Colombia but the fines suck for not filing. You dont file with your wife in Colombia you file seperate, If you own a home together you claim half of the value I had to file 3 different forms in Colombia. Wealth tax,declare worldwide assets, and the income tax. It's hard not to owe if you have assets as income is imputed and threshold is low.
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Post by dandl93 on Jul 8, 2016 12:42:44 GMT -5
Prem I said not for everyone and Very few.I know what works for me in Colombia and this is a subject that no one can do the same as others. I know that expats cant just turn this over to their spouses and call it good.
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Post by Deleted on Jul 8, 2016 17:15:02 GMT -5
If you don't have any assets or income streams in Colombia, you might have a chance of staying under the radar. But if you own property, have EPS coverage, bank accounts or CDTs, your assets and interest are regularly reported to DIAN. Maybe you will get away with not declaring... maybe you won't. You have to make a decision that is "right" by you. As someone already said, just because you declare, it does not necessarily mean that you will pay taxes. There are certain deductions (but not as many as in the US). Per the law (and my accountant), foreign pension/social security income is still considered "exempt" for tax years 2015 and 2016. This exemption may change in 2017. We won't know for sure until January or February. Also, remember that this is an income AND personal wealth tax.
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Post by livinginmedellin on Jul 8, 2016 18:11:36 GMT -5
The US government and IRS now have agreements in place to exchange information with Colombia's DIAN. So don't expect to stay under the radar for long, even if you don't have assets or income in Colombia. See: colombiareports.com/colombia-court-approves-tax-agreement-united-states/Both countries are pursuing tax evaders. IMHO if you live here and don't file taxes when you are required to you are taking a big risk.
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Post by Deleted on Jul 8, 2016 18:53:20 GMT -5
The US government and IRS now have agreements in place to exchange information with Colombia's DIAN. So don't expect to stay under the radar for long, even if you don't have assets or income in Colombia. See: colombiareports.com/colombia-court-approves-tax-agreement-united-states/Both countries are pursuing tax evaders. IMHO if you live here and don't file taxes when you are required to you are taking a big risk. Yes, "worldwide income and assets." It's a brave new world now... and much harder to stay off the grid and under the radar.
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Post by elexpatriado on Jul 8, 2016 21:17:18 GMT -5
Sounds similar to working your butt off your whole life, marrying a Colombiana, bring her to the US, then sign a Pre-nup, and make sure you give full disclosure of all your assets..
Sure ..go ahead and do it..tell them everything..you can trust Lawyers, accountants, the Government..
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Post by sedelen on Jul 9, 2016 12:43:09 GMT -5
I like to thank everyone for all their responses. Nothing like opening a can of worms, eh? Surely it's disheartening to some here to come to realize they are liable, or possibly subject to paying taxes here, and we still are required, at least most of us, have to pay taxes in the States also.
Indeed there is a lot to chew on here, on the table. I still hold some of the criteria in my head from the old Gringos.com posts. Things that have stuck in my head from threads posted there. And one is the deadline to file would be before August, if I'm not mistaken. I think with all that's been written I can still fly under the radar since I have no property, not a member of, or had any dealings with any Colombian financial institution, don't pay rent, etc. Indeed, I'm like a ghost!
But I'm not leaning towards that, at least not at the moment. What concerns me though, would be the limits of my liabilities (what I would be expected to pay) and what I own that would need to be reported, Social Security, military pensions, IRA's, Stateside bank accounts, etc. etc. I'm not a rich man by any stretch of the imagination, but let's face it, we'd all like to keep what we have, and as much as we can from the prying eyes of government(s).
I would sure hate to pay a hefty tax just for the fact that I have accounts back in the States, with funds I have very limited access to here in Colombia.
I still have some time to ponder this a little more. Still that little voice echoes in my mind, "Why would you want to do that?"
There are potential risks in filing also, like sharing with a Colombian what you have, etc. that can make you a target for fraud, robbery, etc. Don't know if I'm real comfortable with that, or comfortable at all.
Anyway....................
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Post by livinginmedellin on Jul 9, 2016 12:56:06 GMT -5
Do you have a visa?
It seems to me it would be real easy for DIAN to get a list of expats from Migración Colombia that have Colombian visas and are from the US, Canada, Australia, and Europe. Then cross check to see if they file taxes. Also Migración Colombia is supposed to have addresses of everyone with visas.
I doubt there are many expats living here that have an income of less than $12,751.
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Post by scumbuster on Jul 9, 2016 13:01:21 GMT -5
Unless they straighten this out I have pretty much decided to spend just under the limit of days in Colombia and will go to another country for 6 months. I feel Colombia should be happy to have expats there spending there money in the economy. We certainly spend more than most locals would, benefiting many businesses. I would potentially consider any place between Costa Rica and Uruguay, with a few glaring exceptions like our neighbor to the east. Like mentioned above, I am not rich by any stretch of the imagination, so if by splitting my time between 2 locations I can eliminate a tax burden I will seriously look at it. If oil doesn't come back soon and as Colombia's economy falters they will be looking at creative ways to get more money that don't affect the majority of voters. Gringos would be an easy target that no one will feel sorry for because we are all rich. At that point I would also have to question weather I want to keep my residency if I have to stay under 6 months for tax reasons anyway.
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Post by bickmed on Jul 9, 2016 13:38:51 GMT -5
Don't forget the forumulario 160 as well if you are a tax resident which requires you to report all your worldwide assets.
For the wealth tax, for rates above 1,100,000,000, as I read it, this was only applicable if you had those value assets in 2015; and payable through to 2018. If you reached the limit in 2016 and did not in 2015; you are not liable - I could be wrong on that though, it is how I read the law.
Even having an RE visa, I am not a tax resident in Colombia, and do not have to declare my WW income etc, although to do that I have to stay out of Colombia for more than 6 months.
Tax in Colombia is a nightmare.
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Post by papitohead on Jul 9, 2016 14:12:41 GMT -5
Really a can of worms. Here we are talking about filing in Colombia. Just asked my wife how she did it and she says she never had. And she worked for the government in a office at a school.
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Post by scott on Jul 9, 2016 15:56:40 GMT -5
I am a permanent resident and file with DIAN each year. Never had to pay any tax. The year I have to disclose word wide income to DIAN, I will leave. Remember a judge can embargo your passport as to prevent your departure from Colombia.
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Post by elexpatriado on Jul 9, 2016 19:54:21 GMT -5
I am a permanent resident and file with DIAN each year. Never had to pay any tax. The year I have to disclose word wide income to DIAN, I will leave. Remember a judge can embargo your passport as to prevent your departure from Colombia. For major Criminal charges and child support only.And a real complicated process. Whata bunch of nervous Nellies.LOL
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Post by sedelen on Jul 10, 2016 11:40:35 GMT -5
I am a permanent resident and file with DIAN each year. Never had to pay any tax. The year I have to disclose word wide income to DIAN, I will leave. Remember a judge can embargo your passport as to prevent your departure from Colombia. For major Criminal charges and child support only.And a real complicated process. Whata bunch of nervous Nellies.LOL Nervous Nellies? indeed! And perhaps for good reason, to establish a new paper trail, in a foreign country to boot. I think back to how many times my personal information has been compromised by government agencies already.
Sometimes, doing the "right" thing, is not always the "best" thing to do.
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Post by livinginmedellin on Jul 12, 2016 11:26:37 GMT -5
Excellent post livinginmedellin . Please follow up after seeing the accountant. That will be a great help for many of us. Should I pay taxes for my Social Security received in the States,not in a Colombian bank? interesting. I met with my Colombian accountant today and she said that Social Security from the US is taxable. She said this is per a ruling from DIAN. Colombian pensions are exempt but foreign pensions are not. The rationale is that someone with a Colombian pension paid taxes in Colombia their entire life, while a foreigner that collects a pension from another country wouldn't have paid taxes in Colombia. She is aware of a couple of retired folks collecting US social security that left Colombia because of this. Also some aggressive accountants in Colombia may still count social security as exempt from taxes. But if your social security income isn't high than taxes in Colombia may be zero or pretty low. She also said the minimum penalty for not filing if you are required to is 10 UVT or 28,279 X 10 = 282,790 pesos. If you didn't file and owed taxes, she said the normal penalty is 5% of what was owed plus interest that runs 30% per year.
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Post by scumbuster on Jul 12, 2016 11:33:02 GMT -5
interest that runs 30% per year.
wow.. At those rates they probably send someone to break your leg if you don't pay.
Well that just confirmed that until the law is changed I will be 1 day less than the residency requirement every year. And at that point I don't need to be a resident either. I can spend that amount of time there as a tourist.
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Post by papitohead on Jul 12, 2016 12:27:37 GMT -5
Well well. So what is the max you can receive without paying taxes or there is a set 30% for all no matter what you get.
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