July 17th, 2020
Normalización tributaria

Through Decree 1010 of 2020, the national government regulated sections 53 to 60 of Law 2010 of 2019, regarding the normalization tax.
It defined the scope of economic use, potential or actual, in the events of foreign private interest foundations, trusts, insurance with a material savings component, investment funds, or any other foreign trust business. This, to determine the taxpayer obliged to declare the normalization tax.
On the other hand, it delimited the scenarios in which there are entities with substantially lower financing costs than their underlying assets. Additionally, it regulated the reduced taxable base applicable to taxpayers who repatriate omitted resources that are invested with a vocation to remain in the country. Thus, the base corresponds to 50% of the value of the omitted resources that are effectively repatriated and comply with the requirements established therein.
With that in mind, the decree established that there will be non-compliance in the repatriation of omitted resources when the taxpayer declares a taxable base reduced to 50% and does not repatriate and/or invest the abovementioned resources. In such cases, the taxpayer must pay the higher value of the tax charged, in addition to any interest on arrears.
The decree also regulated the assets subject to the write-off provided for in section 59 of Law 2010 of 2019.  It stated that for these assets, the reduced taxable base would not apply when they were repatriated.
Finally, it established that those obliged to keep accounting books may depreciate the assets subject to the write-off, that are not depreciated for tax purposes, until the end of their remaining useful life.

For more information contact our team
Learn more about