Colombia Payroll Services

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payroll-services

Colombia Payroll Services

are an important and integral part of any corporation in Colombia. In this article you will find a description of the different employee benefits for Colombian employees. It’s important to understand your responsibilities to pay these obligations are strictly enforced by the Colombian Work Ministry. A failure to not understand the laws because you have a new corporation is not a valid excuse under Colombian law.

It’s important to have a certified accountant and experienced attorney correctly setup work contracts and employee benefits to eliminate risks of lawsuits, including everything from on the job injuries to workers, to employees who make legal claims upon termination of their contract with the employer.

As a complementary service our human resources department has extensive experience in hiring, employee screening, background checks, firing, payroll services, and on the job disciplinary reports. Our employee screening service offers home visits to job applicants homes, which is common for jobs in financial and security fields.

Here is a summary of the many payments and provisional benefits an employer must make during the course of having an employee in Colombia:

Understanding Colombian Payroll Taxes

A) Monthly Payments for employee benefits

1) Salud - EPS Health Insurance
2) Pension – Pension – Social Security
3) ARL - Professional Risk  - Workers Insurance
4) Parafiscales -  (taxes and parafiscal contributions)
A) SENA - Gov. Education Program – SENA educación institución
B) ICBF -  Family Health Services Tax - Bien Estar Familiar
C) CCF - (Employee Benefit Fund - Caja de Compensación)
D) Fosyga - Fondo de solidaridad y garantia
Fondo de salud y eventos catastróficos
Fund & Gaurantee for catastropic health events.

B) Provisional Costs - (Paid on termination of contract, end of year & mid year)

1) Prima de Servicios - Minimum Employee Bonus Required by Law
PAID by end of June 1/2 Monthly Salary, & end of December  1/2 Monthly Salary

2) Vacaciones - Vacation Pay
      15 Business days in a year *(1st year)

3) Cesantías - (Serverence - forced goverment savings)

4) Intereses a las cesantías - Serverence - Interest on forced government savings
Pay before each january 31st to employee directly.

The initial accountant certification for any new worker, and the workers employment contract (written by an attorney) are very important for any new employee/employer. Employees or independent contractors must declare their salaries with various government entities, and it is very important to do this correctly in order to avoid any legal problems with regulatory agencies. This is another reason an independent company like CL & A should be in charge of making and overseeing these payments.

Call us today to receive a certified cost projection for hiring employees and managing payroll services in Colombia.

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Corporate-Filings

Colombian Corporate Tax Filings

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Understanding cultural differences when doing business in Colombia is something that takes time. Accountants in Colombia are very important to assist with your books on a weekly basis. It is very important to stay current on  monthly, bimonthly, quarterly and yearly filings to avoid fines.

REGULATORY TAX FILINGS FOR COMPANIES: Corporations are responsible to file and pay monthly, bimonthly, and annual taxes. Most common tax responsibilities for corporate income and profits are RENTA, IVA, CREE, RETENCION EN LA FUENTE.

Old laws are constantly being amended in Colombia which makes it necessary to have an atttorney and accountant dedicated to your company. Since 2013 tax reforms, foreign residents that spend more than 183 days a year in Colombia now have to file! Foreign tax residents are persons who have over 183 days in Colombia. Foreigners receive deductions on taxes paid over seas.

Tax planning for foreigners with less than 183 days in the country and 183 days or more is very different.  Understand the implications and consult with COLOMBIA LEGAL & ACCOUNTING SAS to understand your legal obligations under Colombian tributary laws.

TAX BRACKETS:

Colombia uses UVT values to determine tax brackets for employee witholding taxes which are required to be retained by some employers. Unidad de Valor Tributario (UVT)

PAYROLL EMPLOYEE TAXES:

are paid out to various government entities to cover health, retirement, and pension benefits on a monthly basis for all employees (with exclusion of some benefits for new companies and employees under law 1429). The following benefits are provisional employee taxes: liquidation, liquidation interests, vacations, and legally required bonuses - which are paid out upon termination of work contracts, at the end of the year, or bi-yearly.

It is important to understand that payroll taxes are heavily regulated and enforced by various government agencies. Not being familiar with these laws as an employer is not an excuse and will lead to heavy fines - and in some cases will even bankrupt companies out of existence for improper planning. Understanding these costs will allow for better planning by knowing the "real" cost of each employee. As a general rule, employee benefits run between 42 to 53% of their salary. Please see our labor law section for more details on how work contracts effect payroll taxes and employee benefits.

Employee taxes are calculated

based on the gross monthly salary of the employee (not including irregular bonuses). Exclusions of payment for employment benefits for health and parafiscales applies to companies that fall under law 1429, which was designed to spur creation of new jobs and companies.

Colombian Annual Corporate Tax Declarations

with us today. Minimum declarations required to be filed annually are:  RENTA + CREE + INFORMACION EXOGENA + INDUSTRY COMERCIO. Colombian corporate annual taxes are due in April, (due dates vary depending on corporte tax id number). Minimum fines for late payments for companies start at  $283,000 * 3 for late tax declarations with the DIAN. The Industry Comercio (city tax)  has 1 tax filing called adviso y tableros, and has a minimum $94,000 fine for late payments, (until 30th of April).

Accountant and Attorney Messenger Services:

We are the pros at obtaining needed certifications from government agencies. We can obtain tax ids (RUT personal, y juridica) for foreign and domestic corporations, as well as digital fingerprint (firma digital) needed to file your taxes.  Other popular services obtaining official bill numbers, and permissions for exporting, importing or obtaining internation commerce certifications to be exempt from sales taxes.  Filings at the chamber of commerce to change executive officers, and/or limit roles of vice presidents in a Corporation. We also handle processes to reduce tax debt, and obtain tax refunds from local and national government offices, such as the DIAN, and Industria Comercio.

Are you behind on your books? We can help you catch up while there is still time. Our bilingual accounting team is available to help you now. call in and get a quote. GET A QUOTE ON YOUR TAX RETURNS TODAY. Get relief today from Colombia Legal & Accounting SAS Book Keeping, Accounting  & Auditing Services team.

For more information on corporate tax filings, and corporate tax planning please contact us in the USA at 1-305-767-2766 or in Colombia at 57-4-444-6634 / 57-301-337-1881 or email info@medellinattorney.com

corporate tax filings by colombian accountant