Colombia
Colombia offers a full deduction of R&D expenses from tax liability. In addition, a 25% tax credit is
granted on those same expenses. An enhanced 50% rate is granted to SMEs.
| Colombia Standard |
Colombia Micro & SMEs |
|
|---|---|---|
| 25% tax credit | 50% tax credit | |
| Benefit Overview
|
Investments in Research & Innovation are 100% deducted in the tax liability. 25% of the costs are granted as tax credit. |
The 25% tax credit is extended to 50% for MSMEs. |
| Eligible Claim Period
|
Investments are claimed during the Fiscal Year. Pre-approval being compulsory, the projects are presented with scientific and financial details. | |
| Historical Background
|
Set in the 90s, the R&D tax incentive program has significantly been improved in 2020, as part of a wide promotion plan for Research and Innovation. | |
| Ease of Application
|
To qualify, the National Committee of Tax Benefits in Science and Technology must approve the project. Costs must meet certain specified criteria to qualify as eligible investment. | |
| Regulating Body Policies
|
Ministry of Sciences (Ministerio de Ciencias) mainly supervises the application of the scheme, including preapproval and control. Tax authorities are also involved. Other ministries can also be solicited depending of the domain. |
|
| Eligible Costs
|
Investments projects mainly include software development, patenting, research, technological development and innovation. Investment expenses are presented to the Ministry of Sciences who approves the qualification. | |
| Issues to Consider
|
Companies are due to pay at least 75% of the gross tax liability. A full demonstration, scientific and financial, is expected for presenting a project. | |