Understanding Tax & Accounting Terms in Colombia
In Colombia, accounting and tax-related services are known as asesorías contables y tributarias. To effectively navigate this field, it’s crucial to understand specific Spanish terms commonly used in Colombian accounting and taxation. This guide offers clear definitions and explanations of these essential terms, helping your business stay informed and compliant with local regulations.
Cámara de Comercio (Chamber of Commerce)
Institution that registers and supervises companies and businesses in Colombia, offering services such as the registration of companies and the oversight of commercial activities.
Declaración de Renta
Document that individuals and companies must submit to the government to report their income, deductions, and calculate the tax to be paid.
DIAN (Dirección de Impuestos y Aduanas Nacionales)
The National Directorate of Taxes and Customs is the government entity responsible for tax and customs administration in Colombia.
ERI (Estado de Resultados Integral)
Financial report that shows a company's income, expenses, and profits over a specific period (Income Statement).
ESF (Estado de Situación Financiera)
Also known as the Balance Sheet, it shows a company's assets, liabilities, and equity at a specific period.
Factura Electrónica
Digital invoice that supports a transaction of goods or services, mandatory for businesses in Colombia.
Habilitación
Process by which companies or individuals register with DIAN as issuers of electronic documents.
IFRS (International Financial Reporting Standards)
International standards for financial reporting that establish how financial statements should be prepared and presented globally.
Información Exógena
Data that companies must report to DIAN about their economic transactions with third parties, to aid in tax control.
IVA (Impuesto al Valor Agregado)
VAT (Value-added tax) applied to the consumption of goods and services. Businesses charge it to customers and then report and pay it to the government.
NIIF (Normas Internacionales de Información Financiera)
Set of international accounting standards that Colombia has adopted for the preparation of financial statements.
Nómina
List of a company's employees and the details of the payments they receive, including salaries, bonuses, and deductions.
POS (Factura POS)
Type of invoice issued at points of sale like supermarkets, different from an electronic invoice. It is a purchase receipt printed at the time of the transaction.
Retención en la Fuente
System where a portion of the tax is directly withheld from certain payments, such as salaries or income from services, and remitted to the government.
RUT (Registro Único Tributario)
Document that identifies individuals and companies as taxpayers in Colombia. It is necessary to conduct any formal economic activity in the country.
