The Transfer Pricing (TP) regime is aligned with the international standards established by Action 13 of the BEPS OECD / G20 project, adapting the scope of the supporting documentation and defining the following formal duties.
Local File or TP report TP Informative Return Master File Country by Country Report or the associated notification Taxpayers subject to the TP regime Requirements TUV (Tax Unit Value) Amount If your gross equity of the fiscal year 2019 is equal to or greater than: 100.000 COP 3.427.000.000 (Approx. USD 1.048.000) Or if your gross income of the fiscal year 2019 is equal to or greater than: 61.000 COP 2.090.470.000 (Approx. USD 639.000) If the taxpayer complies with any of the above requirements, and also performed transactions with:
Foreign related parties; Local related parties located in free trade zones; Permanent establishments (branches); Joint ventures and other associative structures that do not create societies. Then, taxpayers must submit to DIAN (local tax authority) the formal duties listed above.
If the company carries out transactions with enterprises located in tax havens, whether they are related parties or not, it must comply with the fulfillment of the formal TP obligations regardless of the gross equity and gross income caps of the table above.
The Local File must contain the studies, documents and other supports with which the taxpayer of income tax prove that its incomes, costs, deductions, assets and liabilities acquired in the respective fiscal year complied with the Arm's Length principle.
The informative return contains a list of operations carried out with foreign related parties together with the results of the TP analyses reported in the Local File.
The Master File should provide an overview of the business of the Multinational Group including the nature of its worldwide economic activities, its general TP policies and its global allocation of revenues, risks and costs.
Country by Country Report
Since fiscal year 2016, taxpayers subject to TP regime who fulfill assumptions of numeral 2, section 260-5 of the Tax Code, must submit the Country by Country Report. However, this obligation is commonly in the head of the headquarters or corporate.
Attribution Report for Permanent Establishments
On the other hand, the Permanent Establishments must take into account the formal duties that must be accomplished in Colombia when they...