The Ministry of Finance issued Decree 530 of 2020, establishing a new exemption in GMF on banking transactions carried out by NPOs to help the population most affected by the health emergency amid the crisis caused by COVID-19.
In order to apply the exemption, it is mandatory that the NPOs identify as exempt the savings or current accounts from which the respective bank withdrawals will be made. In accordance with the Decree, a maximum of two accounts may be identified as exempt.
As regards the NPOs intending to qualify for this exemption, they must meet the following requirements: (i) submit the respective application before the Superintendence of Finance; (ii) certify that withdrawals have as an exclusive purpose the assistance to communities affected by COVID-19; (iii) submit before the DIAN the copy of the exemption certificate and the confirmation of the purpose of the transfers; (iv) once the emergency is over, submit before the DIAN the total amount of exempted bank withdrawals and the beneficiaries.
Non-compliance with the requirements may lead NPOs to incur in the penalty for not sending information under Article 651 of the Tax Code.
On the other hand, Decree 530 establishes that donations of goods for human and animal consumption, clothing, hygiene items, medicines for human use or construction materials and medical devices are not considered sales for the purposes of value added tax (VAT), as long as they are used to combat the causes that gave rise to the state of national emergency. In any case, the benefit does not apply when the donations are made between economic related parties.