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Capital Gains is 33%?

So if I buy an Colombian apartment and then, sell it in less that 2 years... I pay a 33% Capital Gains tax on the profit?

1.  Capital gains tax in Colombia is 10 percent.

2.  A good accountant may know some tricks to avoid paying the full 10 percent.

3.  Don't buy property in South America if you expect to put it back on the market in under two years.

4.  Re-selling property in South America often takes much more time than an Expat predicts -- frequently years.

cccmedia in Departamento de Nariño

That's not quite the way I understand it, Andymedellin, not since December 2012, although it appears that yes, you could pay 33% but not as capital gains, just as ordinary income tax.  If you sell it in less than two years, it is not considered as a capital gain but as ordinary income - the amount of any gain is added to your existing renta líquida and you pay the normal income tax on that in your declaración de la renta.  See
https://www.gerencie.com/efectos-tribut … encia.html

"Supongamos que la renta líquida gravable de la persona natural es de 1.000 Uvt y vende un activo fijo que no ha estado en su poder por dos años y que le deja una ganancia ocasional de 500 Uvt.
En este caso, la ganancia ocasional se trata como renta líquida, de suerte que la renta líquida total del contribuyente será de 1.500 Uvt, debiendo pagar un impuesto considerable."

Otherwise (selling it after two years) it is considered a ganancia ocasional since the reform of December 2012 and any gain would be taxed at a fixed 10% (subject as cccmedia says, to any manipulations by a good tax specialist).  See
http://www.decompraventa.com.co/ganancia-ocasional

"La tarifa de la ganancia ocasional antes de la vigencia de la reforma tributaria expedida en diciembre del 2012, era del 33% sobre la diferencia entre el costo fiscal y el valor de la enajenación, a partir de dicha reforma la tarifa fue fijada en el 10%, la cual será aplicable para las ganancias obtenidas a partir del año gravable 2013.
Es decir que si usted adquirió su casa por 50.000.000 y dos años después realiza una transferencia por 100.000.000 el valor a pagar sera del 10% de la diferencia es decir 5.000.000"

However, I advise you to seek professional help from a Colombian tax attorney/accountant to see what they say.

To confirm the ten-percent tax on capital gains, you may do a simple google search:

  capital gains tax in Colombia

Naturally, a competent accountant can massage this fact in your favor .. and it's conceivable that the holding time may have an impact on your result. 

Ipso facto:  YMMV. :)

  -- cccmedia

Although Brother Archer's reference to 2012 regulations may still be accurate in 2017, I consider five-year-old regulations in this area of Colombia law to be suspect. 

The taxation rules get changed in many years .. a lot of stuff doesn't get reliably and timely posted on the Internet .. and only a competent tax specialist who follows this stuff constantly is a reliable source on current reality.

cccmedia

cccmedia :

Although Brother Archer's reference to 2012 regulations may still be accurate in 2017, I consider five-year-old regulations in this area of Colombia law to be suspect. 

The taxation rules get changed in many years .. a lot of stuff doesn't get reliably and timely posted on the Internet .. and only a competent tax specialist who follows this stuff constantly is a reliable source on current reality.

cccmedia

Just to be clear - before December 2012 the capital gains tax was 33%, perhaps that is why the OP referenced that number.  But after December 2012 it went to 10% and as far as I know that still holds true (as cccmedia also posted that same rate).

I always suggest getting several opinions if possible - and they may not all give the same answer!

The rules explained above seem to make perfect sense and are quite generous.

OsageArcher :

I always suggest getting several opinions if possible - and they may not all give the same answer!

There is one scenario involving tax liability where I would stop after getting the first opinion:  if I trusted the source -- meaning a qualified, experienced Colombia tax specialist -- and the opinion was that I legally owed no taxes to Colombia.

To do otherwise under those circumstances is known as
looking a gift horse in the mouth. :cool:

cccmedia from Departamento de Nariño

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