🇨🇴 Annual Compliance — Colombia

Overlooking the Industry and Commerce Tax (ICA) at the municipal level

Fix: ICA is a municipal tax of 0.2–1% on gross income that applies in addition to the 35% corporate tax. It varies by municipality and business activity. Register for ICA in the municipality where your business operates and factor it into your tax projections — it adds up, especially for high-revenue, low-margin businesses.

Not registering foreign investment with the Central Bank

Fix: All foreign capital entering Colombia must be registered with the Banco de la República within the prescribed timeframe. Without registration, you lose the right to repatriate profits and capital. This applies to equity investments, loans, and other capital inflows. Your bank typically handles the registration, but verify it has been completed.

Assuming Free Trade Zone benefits apply automatically

Fix: Qualifying for the 20% CT rate in a Zona Franca requires meeting investment and job creation thresholds, operating within a designated zone, and complying with reporting requirements. Single-enterprise Free Zones have higher thresholds. Consult with a Colombian trade specialist before committing to a Free Trade Zone strategy.