Through Decree 743 of 2020, the Ministry of Finance and Public Credit regulates the tax treatment of donations as a tax deduction or discount, as follows

1. Donations made by entities of the special tax regime -Non-profit entities

   When entities of the special tax regime make donations during the respective taxable period to the subjects referred to in article 1.2.1.5.1.2. of the Regulatory Decree 1625 of 2016, they may be treated as outgoing donations up to the amount of the donation made.

   The beneficiaries of the donation must execute the securities received in the national territory in the development of any of the activities carried out by the Non-Profit entities under article 359 of the Tax Statute.

   Taxpayers who opt for the treatment referred to in this article may not treat the donation as a tax deduction.
    

2. Users of financial institutions.

   Users of financial entities controlled by the Superintendence of Finance of Colombia may make donations through automatic cashiers, web pages and digital platforms, including mobile applications belonging to the same financial entities, provided the donation is destined to the financing and support of public higher education institutions.

   Financial entities controlled by the Superintendence of Finance of Colombia shall not be obliged to issue donation certificates when the user does not provide the necessary data to issue the certificate.
    

3. Collecting entities and entities entitled to issue the certificate

   Financial entities controlled by the Superintendence of Finance shall be in charge of collecting donations made by their users through ATMs, web pages and digital platforms, including mobile applications, belonging to the same financial entities.

4. Terms and conditions for the receipt of donated resources and accreditation of the quality of public higher education institution
    
   Public higher education institutions must agree with the financial entities supervised by the Superintendence of Finance of Colombia, the terms and conditions for the reception and transfer of donated resources. These institutions must at least accredit the financial entity with which they sign the agreement:
    
   1. Its quality as public entity.
   2. Its recognition as a higher education institution by the competent entity.

5. Contents of the certificate established in paragraph 2 of Article 257 of the Tax Statute

   As for the certificates and the tools for collecting such donations, it is specified that the financial entities will be the ones to issue them. These must contain the following information:

   •    Name or corporate name and tax identification number of the financial entity
   •    Name or business name and tax identification number of the beneficiary public higher education institution
   •    Name or company name and tax identification number of the donor
   •    Date of donation
   •    Value
   •    Mechanism by which the collection was carried out

   The content of the certification will be understood under the gravity of the oath in accordance with the information provided by the donor, and will serve as support for the tax discount indicated in paragraph 2 of Article 257 of the Tax Statute, and must be available to the tax authority when requested.

   The donation certificate shall be issued within one month following the end of the taxable year in which the donation was collected, through the means available to the financial institution.
    

6. Treatment of donations through financial entities, in favor of public higher education institutions for income and complementary tax purposes and the reporting of exogenous information.

   Donations to public higher education institutions must be reported by financial entities as income on behalf of third parties for income and complementary tax purposes, as well as for the reporting of exogenous information.

   Likewise, donations made in compliance with the provisions of Article 357 of the Tax Statute and Article 1.2.1.4.8. of the Regulatory Decree 1625 of 2016, may be treated as expenses during the taxable period in which the donation is made.

   Non-compliance with such rules shall give rise to the application of the twenty percent (20%) rate, or as a liquid income for the recovery of deductions, as the case may be.

Decree 743 of 2020