If we are good law abiding Expats, we will do our legal bit to help Colombia, but that doesn't mean we are going to empty our pockets for them.
When you decide to live in Colombia, one of your obligations is to visit DIAN and register your status with them, I registered before I received my first cedula, they used my passport to complete the process, telling me to return once I was in possession of my cedula. I had to do this, as I had sent ten boxes of personal possessions from Spain, and had to have a N.I.T. for the import process.
Then you have an obligation to submit a Tax Return every year, for some like myself this causes a bit of extra work, because here the Tax year runs January to December, and in the UK it runs April to April, so I have to work out what is from January to April of one UK Tax year, and April to December of the following.
Again unlike the UK where you can file your own Tax Return, here you can't, you have to employ a certified Accountant, and they come in all qualities from total rubbish, to cheap and thorough, to those that charge more than your tax bill! I have had the pleasure of the first two of these, fortunately now I have a gem. Some will let you prepare your own Tax return and they will check it, then put their signature and stamp to it. However if you can find a good Accountant, they are worth their weight in gold.
If you are not sure if their is a Double Tax Treaty with your home Country, ask your Accountant to liaise with DIAN, and find out, at the time the UK didn't have a Double Tax Treaty, but it turned out that DIAN had a mutual agreement with HMRC in the UK, which amounted to the same thing, therefore my pension in the UK is taxed at source, as a result I provide my UK tax certificates to DIAN, and they work out what the difference is between the two countries, after that they deduct my tax right offs, and if I am lucky I end up paying nothing, except my Accountants bill.
The first meeting I had with the Accountant who has done my returns for the last few years, she told me, "No one wants to pay Tax, and you pay me to to keep your bill to a minimum", to date she has done just that.
In order to reduce your bill, keep every receipt you get, that has anything to do with;
property improvements, maintenance, furniture or taxes;
vehicle purchase, sales, maintenance, taxes, insurance.
Personal bills, such as EPS, other healthcare bills,
Receipts for transfer of funds from your Transfer Company, to show the amount and rate of exchange, Account statements from your home country bank to show 'main' income, as proof it is not from criminal activity,
Any other bills that might just be used to offset taxes here, ask your Accountant, I'm sure I have missed some off.
I would suggest to help your Accountant, and keep his or her bill down, you sort your receipts out, and put them in separate classifications, in date order. I know I get a discount for doing this, and as you have to find them in the first place, it only takes a few minutes to get them in order.
I know there are many Expats who don't file a Tax Return, they think by using an ATM with their home countries Cashcard they can avoid DIAN, and they brag about it, but slowly but surely the Authorities are catching up with these people, it just isn't worth it. I certainly don't like the idea of having to spend my life looking over my shoulder, it may cost a little more, but it's worth the peace of mind.
Great job putting us onto the idea of finding a local who does commercial accounts, Phil.
Moderated by Priscilla 5 years ago
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