Banking, Money and Taxes in Colombia

Handling banking, money and taxes in Colombia comes with its share of bureaucracy. The language barrier, in particular, adds a layer of difficulty because many of the documents, forms, and processes are in Spanish. You may have to enlist the help of a Spanish friend or translator.

Tax matters can become tricky. It may be worthwhile for expats to hire a tax professional to ensure they remain on the right side of the law.

Money in Colombia

Colombia’s currency is the Colombian Peso (COP). While the peso is technically subdivided into 100 centavos, centavos are no longer in practical use.

• Notes: COP 1,000, COP 2,000, COP 5,000, COP 10,000, COP 20,000, COP 50,000 and COP 100,000
• Coins: COP 50, COP 100, COP 200, COP 500 and COP 1,000

Banking in Colombia

Banking in Colombia is a fairly straightforward process. You’ll find that opening a bank account is simple as long as you have the correct documents. It’s also easy to find ATMs, and most places accept credit cards.

Some banks in Colombia have English-speaking staff to assist those who may not be fluent in Spanish. This may vary from bank to bank and branch to branch. You can check with your local bank branch or the bank’s website to see if they offer English-speaking services or if they have bilingual staff available.

Take heed of currency conversion fees when using foreign credit or debit cards in Colombia. These fees can add up quickly, especially in the case of frequent transactions and ATM withdrawals. Several international banks operate in Colombia, offering various banking services to expats and locals alike. These include Citibank (corporate banking only), BBVA, Scotiabank, and others.

Bank hours in Colombia vary depending on the bank and location. In Bogotá, banks typically open from Monday to Friday, 9am to 4pm. In other cities, hours are often split. 8am to 11.30am and 2pm to 4.30pm. Some branches offer extended hours, and many close at noon on the last working day of each month.

Opening a bank account

Expats wishing to open a savings or current account can do so at a local Colombian bank or a multinational bank such as BBVA or Scotiabank.

There are several documents required to open a bank account. These vary from bank to bank but usually include a Cedula de Extranjería (Colombian ID document for foreigners), passport and visa, proof of address, and proof of employment and income. Some banks may ask for references or require a Colombian guarantor – employers are often willing to fulfil these requirements.

Credit cards and ATMs

Expats are unlikely to be granted a credit card from a Colombian bank unless they already have an existing credit record in the country or have been banking in Colombia for six months or more. New arrivals needing a credit card will either have to bring one from home and possibly bear steep transaction fees, or apply for a credit card with an international bank in Colombia. References from a previous bank back home can boost their chances of approval.

In major cities, credit cards are accepted just about anywhere, including shops, hotels, and restaurants. Don’t be surprised if you’re asked to present some form of identification before you can pay with a credit card. In smaller towns, places that accept credit cards may be few and far between. Similarly, ATMs are easy to find in big cities but can be scarce in smaller towns.

Some ATMs only offer withdrawals at certain hours of the day or place a limit on withdrawal amounts at night for safety reasons. Always be aware of your surroundings while using an ATM, and be wary of anyone loitering close by.

Useful links

• Banco de la República
• Bancolombia
• Davivienda
• BBVA Colombia

Taxes in Colombia

Tax in Colombia is either deducted monthly from a salary or paid in an annual tax return. For individuals, tax return deadlines run from August to October each year, with specific dates based on the last digits of one’s tax identification number. There is a penalty for filing tax returns late.

Full-time residents – foreigners in Colombia for 183 days or more within a tax year – must pay tax on their total worldwide income. Those who spend fewer than 183 days a year in Colombia are only taxed on their earnings from within the country. Income tax in Colombia is progressive, with rates ranging from 0 to 39 percent depending on income levels. Residents may also be subject to wealth tax if their assets exceed certain thresholds.

Due to the tricky nature of expat taxes, we recommend hiring an experienced expat tax professional for guidance.

Useful links

• DIAN: Colombian Tax Authority