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 Colombian 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.
Here is a summary of the many payments and provisional benefits an employer must make during the course of having an employee in Colombia:
As a complementary service our Colombian 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.
Understanding Colombian Payroll Taxes
For a Colombian labor contract you will be responsible for paying and keeping track of the following benefits:
A) Monthly Payments for Employee Benefits:
1) Salud – EPS Basic Colombian Health Insurance
2) Pension – Pension – Social Security
3) ARL – Professional Risk – Workers Insurance
4) Parafiscales – (taxes and parafiscal contributions)
4.1) SENA – Gov. Education Program – SENA educación institución
4.2) ICBF – Family Health Services Tax – Bien Estar Familiar
4.3) CCF – (Employee Benefit Fund – Caja de Compensación)
4.4) Fosyga – Fondo de solidaridad y garantia
4.5) Fondo de salud y eventos catastróficos – (Fund & Gaurantee for catastropic health events)
B) Provisional Costs – (Paid on termination of contract, beginning of the year, end of year & mid year)
B.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
B.2) Vacaciones – Vacation Pay 15 Business days in a year *(1st year)
B.3) Cesantías – (Serverence – forced goverment savings)
B.4) Intereses a las cesantías – Serverence – Interest on forced government savings. Pay before each january 31st to employee directly.
Frequently Asked Questions (FAQ)
What is a Colombian SAS Corporation in simple terms?
A SAS is a simplified joint-stock company that combines features of an LLC and a traditional corporation. It's flexible, low-cost, and designed to protect shareholders from personal liability.
Can I create a SAS with only one person?
Yes. A single shareholder can form a Colombian SAS Corporation. There’s no requirement for a board of directors or multiple owners.
Is a SAS corporation valid for applying for a Colombian visa?
Absolutely. A SAS can be used to support a Colombian Investor Visa application, provided it meets the required investment thresholds.
How much does it cost to start a SAS?
You can start a SAS with very low costs—often under $1,000 USD—depending on the services used and whether asset contributions require notarization.
Do I need to be in Colombia to start the process?
No. You can start remotely by giving power of attorney to our firm, and we can handle most of the process on your behalf.
Final Thoughts: Should You Open a SAS in Colombia?
If you're still wondering what is a Colombian SAS Corporation, the answer is simple: it's your easiest path to legally start a business, protect your assets, and access Colombian residency options.
📞 Ready to get started?
Let the experts at Colombia Legal & Associates and Visas by James help you form your Colombian company.
Visit www.colombiavisas.com or contact us today for a free consultation.
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