In a swift move, the Colombian government has changed the way taxpayers deal with stamp tax. Decree 175 of 2025 released on 14 February 2025 temporarily reinstates the 1% the tax rate, which generally was 0%, in an effort to address the internal conflict in the country. The rate increase applies during the period 22 February through 31 December 2025.
The stamp tax applies to both public instruments and private documents that are executed in Colombia or abroad but implemented in Colombia or generate obligations in the country. Subject to certain exceptions, the taxable event is the execution/subscription of covered documents when obligations are established, modified, executed, generated or eliminated and the value of the obligations exceeds 6,000 tax units (UVT) (COP 298, 794 or USD 76,000). The following transactions are exempt from stamp tax:
The taxpayer (i.e., the person in whose favour the document is issued, granted or executed) is a public entity, legal entity or an individual that holds the status of a merchant and who in the preceding year earned gross income or had gross assets exceeding 30,000 UVT.
As noted above, the decree temporarily reinstates the 1% stamp tax rate, except for real estate transactions where the rate remains at 0%, 1.5% or 3%, depending on the UVT value of the property. The stamp tax is collected via withholding, with the withholding agent being a person listed in the Colombian tax code or the decree.
Except in specific instances, stamp tax is due at the time of granting, subscription, issuance, acceptance, expiration, extension or payment of the instrument, document or title, whichever occurs first. In the case of documents of undetermined value, stamp tax will be due with each payment or accrual, whichever occurs first.
Although the reinstated 1% stamp tax affects a wide range of documents and contracts, several exemptions can help alleviate the impact of the tax. Therefore, potentially affected businesses should evaluate existing and future documents/instruments to determine whether they fall within the scope of the tax, proactively assess how the rate change may affect their financial structures and consider strategies that will help to avoid financial surprises.
Martha Reyes Amaya
BDO in Colombia
Overview of the Changes
The stamp tax applies to both public instruments and private documents that are executed in Colombia or abroad but implemented in Colombia or generate obligations in the country. Subject to certain exceptions, the taxable event is the execution/subscription of covered documents when obligations are established, modified, executed, generated or eliminated and the value of the obligations exceeds 6,000 tax units (UVT) (COP 298, 794 or USD 76,000). The following transactions are exempt from stamp tax:
- Orders for the purchase or sale of goods or services;
- Commercial offers that are accepted upon the issuance of a purchase or sale order;
- Private documents for the export of domestically produced goods and services; and
- Certain invoices referred to in the Commercial Code (e.g., invoices for the sale of merchandise).
The taxpayer (i.e., the person in whose favour the document is issued, granted or executed) is a public entity, legal entity or an individual that holds the status of a merchant and who in the preceding year earned gross income or had gross assets exceeding 30,000 UVT.
As noted above, the decree temporarily reinstates the 1% stamp tax rate, except for real estate transactions where the rate remains at 0%, 1.5% or 3%, depending on the UVT value of the property. The stamp tax is collected via withholding, with the withholding agent being a person listed in the Colombian tax code or the decree.
Except in specific instances, stamp tax is due at the time of granting, subscription, issuance, acceptance, expiration, extension or payment of the instrument, document or title, whichever occurs first. In the case of documents of undetermined value, stamp tax will be due with each payment or accrual, whichever occurs first.
BDO Insight
Although the reinstated 1% stamp tax affects a wide range of documents and contracts, several exemptions can help alleviate the impact of the tax. Therefore, potentially affected businesses should evaluate existing and future documents/instruments to determine whether they fall within the scope of the tax, proactively assess how the rate change may affect their financial structures and consider strategies that will help to avoid financial surprises.Martha Reyes Amaya
BDO in Colombia