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The Tax Man Cometh!

Discussion forum for expats moving to or living in Colombia.

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The Tax Man Cometh!

Post Posted: Wed Aug 12, 2015 7:33 pm

I had a hell of a shock yesterday, we heard from my Accountant here in Colombia, apparently the Colombian Government are so strapped for cash that they are now targeting Expats.

When I first moved here in Jan 2012, Expat residents were Tax exempt for their first four years, then they changed that, so that you paid tax from the moment you became resident from January 2013, but under the same rules as Colombians, therefore last year I paid no tax, because my income wasn't high enough.

Apparently last October they changed it again, so that Expats who are not covered by a double taxation treaty, and the UK is not, will be taxed on their entire pension after permitted expenses. I already pay 20% in the UK, and apparently the Colombian rate is 35%, although that's not confirmed as the amount I would have to pay, if it is, it's not going to leave me enough to live on! Crying or Very sad

One glimmer of hope, SWMBO who is very careful with MY money smile Smile did some research, and thinks the Accountant has got it wrong, and that this only applies to voluntary pension contributions, not your works pension, we now wait on the edge of our seats, to see the outcome, as the Accountant is going to see DIAN, the tax authorities today.

If the Accountant is right, I can see many Expats moving out of the country, what I will do, I have no idea.

I will update this, once I have a definitive answer.


If you want the rainbow, you got to put up with the rain - Steven Wright


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Re: The Tax Man Cometh!

Post Posted: Thu Aug 27, 2015 7:35 am

I finally heard from my Accountant today, and it was good news.

I can only give a guide for UK Pensioners, which is as follows:

The law has changed, and we are liable for tax on our pensions, however although there is no Double Tax Treaty between Colombia and the UK, DIAN and HMRC have an 'Understanding', what form that takes, I have no idea, but not to let us know is sneaky!

As a result, DIAN will credit any tax paid on your UK Pension against your Colombian tax bill, you just have to provide P60s covering the year in question, so for 2014, you need your P60 for 2013 to cover January to April, and the one for 2014 to cover April to December.

The tax Colombia wanted for the year is more than covered by the tax I have paid in the UK, so my Pension tax bill is zero.

From discussions I have had on other forums, this is a big worry for all Expat Pensioners, hopefully if you are affected, the result will be the same for you.


If you want the rainbow, you got to put up with the rain - Steven Wright


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