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Post by livinginmedellin on Apr 4, 2017 10:15:15 GMT -5
The Dirección de Impuestos y Aduanas Nacionales de Colombia (DIAN) will have a new source of information to fight against tax avoidance and international tax evasion. This was announced yesterday by the Minister of Finance, Mauricio Cárdenas, after finding out the decision of the Internal Revenue Service of the United States of America (IRS) to include Colombia in the list of jurisdictions with which it is prepared to exchange tax information. In the context of such an agreement, US financial institutions in the US shall identify the financial assets owned by Colombian fiscal residents and the financial returns associated with such assets. Cárdenas added that "these entities report this information to the IRS, which in turn will automatically send to DIAN every 30 September information on financial returns." The first package of information to be sent by the IRS to DIAN contains reports for 2014 and 2015 and will be received in the coming weeks, Cardenas said. He added that the inclusion of Colombia is "a great step forward ... since it implies the implementation of the provisions of the Agreement for the Exchange of Tax Information signed by Colombia and the United States in 2001 and approved by Congress Of the Republic in 2013 by Law 1666 ". In addition to Colombia, two other Latin American countries are included in the list: Brazil and Mexico. Canada, Spain, Jamaica and the United Kingdom, countries with tradition of Colombian taxpayer investments are also in the relationship. Cárdenas also recalled that this year is ending the normalization period, that is, Colombian taxpayers who have not yet declared their assets abroad to DIAN, should be up to date paying only a fee of 13% on the equity value that they have or non-existent liabilities that have been improperly included. "It is completely legal and legitimate to have financial accounts abroad, but it is necessary that the same be declared by Colombian tax residents in their tax returns and informed in the statement of assets abroad," said the minister. In a dialogue with this newspaper, the Director of Income Management of the DIAN, Cecilia Rico Torres, stated two weeks ago that in Medellín few have accepted standardization: "only 3,687 have declared 8 trillion pesos and paid between 2015 and 2016, 867 billion pesos in assets, mainly in the US, Panama and Spain. See (in Spanish): www.elcolombiano.com/negocios/ee-uu-sera-aliado-de-la-dian-para-atrapar-a-evasores-fiscales-BL6269704 |
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Post by elexpatriado on Apr 4, 2017 11:46:23 GMT -5
Open the flood gates
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Post by charlie640 on Apr 4, 2017 16:30:01 GMT -5
Colombia TAXES your overseas assets !!
Your car, boat, houses and all $$ held in bank accounts.
Its not a big % but it SUCKS.
Now is that any way to attract wealthy
foreigners ?? The BIG looser is COLOMBIA.
Such foools. Moral of the story.... don't stay in COL more than
183 days / year.
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Post by tubes on Apr 4, 2017 17:16:12 GMT -5
Quite right too!
Why should Colombia be a tax haven for fugitive Americans - most other civilised countries are not!
Colombia has nothing to lose from this action. The honest Americans will come anyway, not that they are going to make any significant difference to the budget.
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Post by sedelen on Apr 4, 2017 17:28:03 GMT -5
Not good news, really. Depending on the mechanics of how this stuff is reported, from whom to whom, it could cause a lot of problems, especially for people with IRA's and 401K's invested in mutual funds with certain brokerages, i.e. Charles Schwab and more than likely others, as most require you to be invested in ETF's. Liquidate the funds in the brokerage account and you could find yourself with a big hefty capital gain for the year you sold it. After all the time I've been here, I still don't know what I'm required to report to Colombia. I was going to inquire about them tomorrow, and still plan too. Worldwide assets, ring a bell? The "noose" is getting tighter it seems, the tiny voice inside my head is telling me to leave while the getting is good. Even still, there are those I know who could care less. Since they don't report any taxes to anyone, they don't need to concern themselves with anyone sharing information, because there isn't any! They will probably continue to live on down here without so much as a passing thought about taxes. I would think that if a person doesn't report anything in Colombia, establish a record here or have it on file, how would the Colombian government even know who is a fiscal resident? unless Immigration starts tracking the dates to determine the 183 day residency requirement. And then you got Trump wanting to cut the IRS budget to build his wall and beef up the military. The articles I'm reading are telling me they won't be able to do much of anything, never mind adding fulfilling further reporting requirements abroad. www.cbpp.org/research/federal-budget/trump-budget-may-slash-irs-funding-further-despite-mnuchins-call-for-morewww.nbcnews.com/business/taxes/enjoy-doing-your-taxes-year-because-next-year-will-be-n742081?cid=public-rss_20170403 |
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Post by livinginmedellin on Apr 4, 2017 17:50:12 GMT -5
It would be so easy for Migracion to generate a report of all foreigners from the US with visas that have been here in Colombia over 183 days so they are Colombian tax residents. And then DIAN could see how many on that list filed taxes in Colombia.
The income requirement for filing income taxes in Colombia is very low. It was only 39,591,000 pesos in worldwide income in 2015 ($12,751 USD at the official exchange rate at end of 2015) for needing to file taxes in 2016 for tax year 2015. How many expats from the US that are tax residents in Colombia have an income lower than that low threshold? I would think not many.
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Post by tubes on Apr 4, 2017 18:26:20 GMT -5
Filing taxes in Colombia is another thing from actually having to pay anything.
Accountants fees are generally low although everyone interprets the regulations differently.
Just because you have $114 millions in assets in Colombia, does not mean that you will have to pay anything.
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azarat
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Post by azarat on Apr 4, 2017 18:26:20 GMT -5
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azarat
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Post by azarat on Apr 4, 2017 18:39:26 GMT -5
Boy those Colombian jails are gonna get crowded with all those expat tax evaders
Probably have to have early release for a lot of those murderers, rapists, Narcos and child molesters just to make enough room.
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Deleted
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Post by Deleted on Apr 4, 2017 18:40:28 GMT -5
The agreement to exchange tax information between the two countries have been in place for a couple of years. The question is: When will Colombia finally be able to implement a system to correlate people and financial data? But then as someone mentioned, it would be very easy for DIAN to ask Migracion Colombia for a list of visa holders and certificates of migration.
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Post by sedelen on Apr 4, 2017 18:49:06 GMT -5
It would be so easy for Migracion to generate a report of all foreigners from the US with visas that have been here in Colombia over 183 days so they are Colombian tax residents. And then DIAN could see how many on that list filed taxes in Colombia. The income requirement for filing income taxes in Colombia is very low. It was only 39,591,000 pesos in worldwide income in 2015 ($12,751 USD at the official exchange rate at end of 2015) for needing to file taxes in 2016 for tax year 2015. How many expats from the US that are tax residents in Colombia have an income lower than that low threshold? I would think not many. It would be, but would they? I don't think so, that might come later as they tighten the noose a little more. But it was my understanding you had to register if you fit into that 183 day category even if you didn't owe anything. |
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Post by sedelen on Apr 4, 2017 19:19:59 GMT -5
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Post by Deleted on Apr 5, 2017 8:28:09 GMT -5
Not sure why all the drama-file your taxes and pay them-Taxes in Colombia are not the lowest in the world-but listening to some you would think its the end of the world! I think a lot of it has to due with a lack of understanding. If you make money and have assets you may have to pay additional taxes beyond your home country-but then you can afford to-if your broke your liability is likely to be nominal.
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Post by buenopues on Apr 5, 2017 8:55:53 GMT -5
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Post by sedelen on Apr 5, 2017 10:22:27 GMT -5
Not sure why all the drama-file your taxes and pay them-Taxes in Colombia are not the lowest in the world-but listening to some you would think its the end of the world! I think a lot of it has to due with a lack of understanding. If you make money and have assets you may have to pay additional taxes beyond your home country-but then you can afford to-if your broke your liability is likely to be nominal. If it were only a matter of paying the taxes that would be one thing. However, there are financial assets you can easily own in the States in the way of brokerage accounts and mutual funds that you can no longer continue to own should you move to Colombia, and more and more of them are in the process of closing accounts if you live overseas. Should you not own any, no drama. The fact is the companies that most ordinary citizens have accounts with just don't want to deal with the hassles of all the conflicting tax laws concerning overseas accounts. Maybe this will increase peoples understanding. thunfinancial.com/us-brokerage-accounts-american-expats-closed-2015/assetbuilder.com/knowledge-center/articles/american-brokerages-slam-the-door-on-us-expats |
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Post by livinginmedellin on Apr 5, 2017 10:35:36 GMT -5
Actually I didn't see visas in that. Migracion Colombia doesn't issue visas, they issue cedulas. I see # of cedulas issued to Americans in 2014 on page 31. Total of 4,987 cedulas issued to Americans in 2014. Keep in mind some visas are only good for a year. So some cedulas would be renewed each year, but TP-10 is good for 3 years and RE visa is good for 5 years. So not every American living in Colombia gets a new cedula/visa each year. |
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Post by sedelen on Apr 5, 2017 10:45:15 GMT -5
Actually I didn't see visas in that. Migracion Colombia doesn't issue visas, they issue cedulas. I see # of cedulas issued to Americans in 2014 on page 31. Total of 4,987 cedulas issued to Americans in 2014. Keep in mind some visas are only good for a year. So some cedulas would be renewed each year, but TP-10 is good for 3 years and RE visa is good for 5 years. So not every American living in Colombia gets a new cedula/visa each year. Yeah, the Pensionado visa, TP-7 in of the one year type. |
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Post by Deleted on Apr 5, 2017 10:48:46 GMT -5
Not sure why all the drama-file your taxes and pay them-Taxes in Colombia are not the lowest in the world-but listening to some you would think its the end of the world! I think a lot of it has to due with a lack of understanding. If you make money and have assets you may have to pay additional taxes beyond your home country-but then you can afford to-if your broke your liability is likely to be nominal. If it were only a matter of paying the taxes that would be one thing. However, there are financial assets you can easily own in the States in the way of brokerage accounts and mutual funds that you can no longer continue to own should you move to Colombia, and more and more of them are in the process of closing accounts if you live overseas. Should you not own any, no drama. The fact is the companies that most ordinary citizens have accounts with just don't want to deal with the hassles of all the conflicting tax laws concerning overseas accounts. Maybe this will increase peoples understanding. thunfinancial.com/us-brokerage-accounts-american-expats-closed-2015/assetbuilder.com/knowledge-center/articles/american-brokerages-slam-the-door-on-us-expatsYou can build a much better and less costly portfolio with ETFs and individual stocks, etc. Again, IMO a little too much drama surrounds this issue. |
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Post by sedelen on Apr 5, 2017 10:57:52 GMT -5
You can build a much better and less costly portfolio with ETFs and individual stocks, etc. Again, IMO a little too much drama surrounds this issue. Quite possibly, still you have to liquidate what you own, and unless it's in a retirement account of some kind, IRA, 401K, you may have some serious tax liabilities in the way of capital gains, which could adversely affect your tax liability for the year you sell them. |
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Post by Deleted on Apr 5, 2017 12:35:45 GMT -5
You can build a much better and less costly portfolio with ETFs and individual stocks, etc. Again, IMO a little too much drama surrounds this issue. Quite possibly, still you have to liquidate what you own, and unless it's in a retirement account of some kind, IRA, 401K, you may have some serious tax liabilities in the way of capital gains, which could adversely affect your tax liability for the year you sell them. Yes Sedelen that is true. I had a friend in that situation and he used his sisters address, changed his mailing address and Drivers License to the address and was able to keep his account-the brokerage was aware and said it was ok-he did spend a month or 2 a year in the states. Not sure of the exact requirements(in terms of days in the States) to be considered a resident when you are a citizen. |
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Post by charlie640 on Apr 5, 2017 14:55:21 GMT -5
Quite right too! Why should Colombia be a tax haven for fugitive Americans - most other civilised countries are not! Colombia has nothing to lose from this action. The honest Americans will come anyway, not that they are going to make any significant difference to the budget. Nonsense. This has ZERO to do with COLOMBIA becoming a tax haven. This has to do with COLOMBIA TAXING ones assets held in other countries. Assets that were LEGALLY acquired, Reported and with funds that were already taxed to the maxed. It is a WEALTH TAX. Only a handful of countries have a WEALTH TAX, must notably France, with many high profile people leaving the country because of it. "Honesty" has ZERO to do with it. Allowing the Government to screw you over does. |
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Post by buenopues on Apr 5, 2017 16:41:45 GMT -5
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Post by tubes on Apr 5, 2017 17:03:24 GMT -5
Charlie640: the subject is about tax avoidance and international tax evasion.
If you are resident in Colombia then you are no longer resident in the USA and thus not paying any taxes there.
Many other countries (particularly Europe) already require you to declare all overseas investments, and many have international agreements that their tax authorities will exchange information.
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Post by Deleted on Apr 5, 2017 17:13:40 GMT -5
I am a US citizen, and file every year. I am also a Colombia resident, and file my declaration every year. In 2016, I owed Uncle Sam $131, and Colombia owed me COP$ 626,000. I never thought becoming an ex-pat would be fraught with so many land miles. Nevertheless, still happy and thriving in my adopted country.
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Post by sedelen on Apr 5, 2017 17:41:40 GMT -5
After reading both articles, I believe this initiative is an effort to identify financial assets in the States belonging to Colombians. The article by Colombia Reports is somewhat clearer than the initial article. colombiareports.com/us-share-bank-account-information-colombia-curb-tax-evasion/And in the Colombian Report article it states "Colombians" with accounts valued over 50K in the States will be reported, and further on it says someone with an account over 50K will be reported, leaving a person wondering if several accounts under 50K but totaling over 50K will be reported or not. I think that any ex-pat married to a Colombian with a joint account totaling over 50K might be vulnerable to be reported. It further states, that a person who does not legalize it, or does not declare it, (I'm assuming for the two years 2014 and 2015 that Dian will be receiving reports for from the States) can now do so, with only a 13% penalty ($50,000.00 X 13% = $6,500.00), or $6,500 minimum, or if they don't pay and they are reported to DIAN, fines can be imposed of up to 170% ($50,000 X 170% = $85,000) or $85,000, of the value of the assets that were not declared. At least that's how I understand it, Whew! |
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Post by sedelen on Apr 5, 2017 17:46:03 GMT -5
Charlie640: the subject is about tax avoidance and international tax evasion. If you are resident in Colombia then you are no longer resident in the USA and thus not paying any taxes there. Many other countries (particularly Europe) already require you to declare all overseas investments, and many have international agreements that their tax authorities will exchange information. The United States is one of the few countries that requires it's citizens to file taxes while living abroad. www.irs.gov/individuals/international-taxpayers/taxpayers-living-abroad |
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Post by charlie640 on Apr 6, 2017 7:24:22 GMT -5
Odds are the only way your not required to file a USA TAX return is if your are not a USA Citizen.
Additionally if you have an aggregate of more than USD 10K in non-USA financial accounts you are
required to tell the USA govt about then using form 8938 and the FBAR.
What counhtry you reside has ZERO to do with anything.
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Post by Deleted on Apr 6, 2017 7:45:16 GMT -5
Odds are the only way your not required to file a USA TAX return is if your are not a USA Citizen. Additionally if you have an aggregate of more than USD 10K in non-USA financial accounts you are required to tell the USA govt about then using form 8938 and the FBAR. What counhtry you reside has ZERO to do with anything. almost correct- www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements |
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Post by Deleted on Apr 6, 2017 7:48:22 GMT -5
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Post by charlie640 on Apr 6, 2017 8:05:41 GMT -5
I don't have issues with income tax, so long as one is not subjected to "double taxation", which is exactly what a wealth tax is. Its similar to the estate or death tax. |
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