Esteban Rada
Colombian attorney
www.lawyerscolombia.com
email: info@lawyerscolombia.com
telephone 57-311-7693976
Our law firm provides full service to help foreign understand tax implication in Coombia when buying a property.
When buying a property in Colombia, there are several tax elements to consider. These include:
Tax Withhold ( retencion en la fuente): This tax is levied on the transfer of real estate property and is generally paid by the buyer. The rate is around 10% of the price agreed on the contract
Value Added Tax (Impuesto al Valor Agregado – IVA): IVA is a general sales tax that applies to the sale of new residential properties. The current rate is 19%. However, the government often reduces or eliminates this tax for low-income housing or for first-time buyers.
Wealth Tax (Impuesto sobre el Patrimonio): This tax applies to individuals or entities with a net worth exceeding a certain threshold. The tax rate progressively increases based on the net worth. Properties are one of the components considered when determining net worth.
Property Tax (Impuesto Predial): Property owners are required to pay property tax annually to the municipality where the property is located. The tax rate is based on the assessed value of the property determined by the municipality.
Notary and Registration Fees: When buying a property, you will need to pay notary fees for the drafting and formalization of the purchase contract. Additionally, registration fees are required for the registration of the property transfer with the local Property Registry Office.
It is important to note that tax laws and rates are subject to change, each case is different and there are ways to reduce or eliminate taxes, so it is advisable to consult with us for the most up-to-date information and guidance.
Esteban Rada
Colombian attorney
www.lawyerscolombia.com
email: info@lawyerscolombia.com
telephone 57-311-7693976
