Colombia
Top Income Tax
39%
Marginal rate
Corporate Tax
35%
Standard rate
VAT / Sales Tax
19%
Standard rate
Capital Gains
15%
Standard rate
Overview
Colombia offers a very low cost of living and a growing digital nomad community, especially in Medellin and Bogota. The tax system is relatively high for formal employment but the digital nomad visa has low income requirements. Free trade zones offer 20% corporate rate.
Income Tax Brackets
| Income Range (COP) | Tax Rate |
|---|---|
| 0 - 1,090 | 0% |
| 1,090 - 1,700 | 19% |
| 1,700 - 4,100 | 28% |
| 4,100 - 8,670 | 33% |
| 8,670 - 18,970 | 35% |
| 18,970 - 31,000 | 37% |
| 31,000+ | 39% |
UVT-based brackets (1 UVT = ~47,065 COP in 2024). Progressive system.
Corporate Tax
Standard Rate
35%
35% standard rate. Reduced rates available for specific sectors and free trade zones (20%).
VAT / Sales Tax
Standard Rate
19%
Reduced Rates
5%
19% standard. 5% on some processed foods, insurance, and storage.
Capital Gains Tax
Standard Rate
15%
15% on occasional gains. 10% on dividends for residents.
Social Security Contributions
Employee
8%
Employer
20.5%
Self-Employed
28.5%
Covers health, pension, ARL (occupational risk). Independent contractors pay full amount.
Special Tax Regimes
Free Trade Zones
20% corporate tax rate (vs 35% standard) and VAT exemption on inputs.
Eligibility: Must be established in designated free trade zone. Various requirements depending on zone type.
Digital Nomad Visa
Digital Nomad Visa (V-type). Must earn at least 3x Colombian minimum wage (~USD 975/month). Valid 2 years.
Pros & Cons
Pros
- Very low cost of living
- Digital nomad visa with low threshold
- Free trade zone 20% rate
- Growing startup scene in Medellin
- Warm climate
Cons
- High corporate tax (35%)
- Complex tax code
- Security perception
- 39% top income rate
- Limited tax treaties
Living Indicators
Cost of Living Index
Very affordable
Quality of Life Index
Average
Best For
Data Sources
Tax rate data for Colombia is compiled from the following authoritative sources:
- OECD Tax Database
- Tax Foundation International Tax Competitiveness Index
- World Bank Business Enabling Environment
- Colombia government tax authority publications
- PwC Worldwide Tax Summaries
Last verified: 2024-01
Disclaimer: This content is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making decisions about your tax residency or obligations.