Income tax (rates / brackets)

Colombia's income tax system applies progressive rates to resident and non-resident individuals and legal entities earning income within Colombian territory or from Colombian sources abroad. The tax year runs from January to December, and rates vary based on taxable income brackets adjusted annually for inflation.

For 2024, individual residents are subject to rates ranging from 0% on income below the tax-exempt threshold to 39% on income exceeding approximately 300 UVT (Tax Value Unit). The UVT is indexed yearly; for 2024 it stands at COP 51,589. Non-residents face a flat 35% rate on Colombian-source income. Legal entities, including corporations and partnerships, are taxed at a standard rate of 35% on net taxable income, though certain entities may qualify for preferential rates under special regimes.

The Colombian tax framework is governed by the Colombian Tax Code (Estatuto Tributario) and administered by the National Tax and Customs Directorate (DIAN). Recent reforms have introduced adjustments to brackets and rates; the 2024 rates reflect the annual UVT revaluation mandated by Colombian tax law.

Employers and payroll teams must calculate withholding tax on employee salaries using current-year UVT values and applicable brackets. Monthly or bi-weekly withholding is required, with annual reconciliation during the March–April filing period. Self-employed individuals and independent contractors must also file annual declarations and make quarterly advance payments based on prior-year tax liability. Accurate classification of income type—employment, business, capital gains, or other—is essential, as each category may have distinct treatment under Colombian tax law.