Set up a company in Colombia.
Latin America’s third-largest market by population (52m) and 4th-largest economy. OECD member since 2020. Founding member of the Pacific Alliance, US-Colombia FTA in force since 2012, plus FTAs with the EU, UK, Canada, Mercosur, South Korea and many more. The headline nearshoring beneficiary alongside Mexico. SAS (Sociedad por Acciones Simplificada) is the dominant structure — ~95% of new Colombian companies, single shareholder permitted, fast to incorporate.
The standard structure for foreign investors is a Sociedad por Acciones Simplificada (SAS) — introduced under Law 1258 of 2008 and now the dominant Colombian corporate form, accounting for around 95% of newly incorporated companies. Single shareholder permitted, no minimum capital, flexible bylaws, lighter formalities than the traditional Sociedad Anónima (SA). Larger or regulated operations use an SA. The Sucursal de Sociedad Extranjera (branch) is used where parent-level booking is structurally necessary.
You draft the bylaws (estatutos) in Spanish, register with the local Cámara de Comercio (Chamber of Commerce), obtain the NIT (corporate tax ID) and RUT (Registro Único Tributario) from DIAN (Dirección de Impuestos y Aduanas Nacionales), register foreign capital with the Banco de la República, and complete municipal and social-security registrations. Standard SAS formation takes 3 to 6 weeks end-to-end — Colombia is structurally efficient for incorporation, with banking and FX registration being the long pole.
Grant & Graham coordinates Colombian formations through our São Paulo office (our LatAm regional hub, opened 2026) working with senior Bogotá and Medellín counsel — structure selection, Chamber of Commerce filing, NIT/RUT and DIAN registration, Banco de la República FX registration, banking, sector licensing, and ongoing tax and statutory work.
35% headline CIT. Plus sector surcharges. 15% minimum effective rate. IVA 19%.
Colombian corporate taxation is high in regional terms and structurally complex. The general CIT rate is 35% — one of the highest in Latin America. Sector surcharges apply on top: financial institutions +5% through 2027 (40% effective), oil and coal extraction permanent +5–15% (linked to commodity prices), hydroelectric +3% through 2026. A minimum effective tax rate (TTD) of 15% applies. IVA (VAT) at 19%. Dividend WHT of 20% to non-residents (15% individuals, 10% national entities). The Petro government submitted a tax reform bill in September 2025 proposing further increases — financial institutions to permanent 15% surtax, non-resident dividend WHT 20%→30%, SEP 3%→5%. The reform is in congressional debate with strong opposition — outcome and timing uncertain.
Other notable items: GMF (4x1000) 0.4% financial transaction tax on covered banking operations — unusual but stable. PIT progressive 0–39% (top rate). Wealth tax on individuals with net worth above 72,000 UVT (~COP 3.59bn) at 0.5–1.5%. SEP (Significant Economic Presence): 3% on gross revenue or 10% WHT for foreign digital services to Colombia above 31,300 UVT threshold. ICA municipal industry & commerce tax 0.2–1.4% on gross revenue (varies by municipality). 20+ double taxation treaties.
Nine reasons businesses choose Colombia.
Latin America’s third-largest market and the standout nearshoring beneficiary alongside Mexico. OECD member, Pacific Alliance founder, US-Colombia FTA since 2012, EU FTA, and one of the most dynamic tech ecosystems in the region — Bogotá for financial services and corporate operations, Medellín for technology and innovation. The structural opportunity is real, the tax overhead is high, and the practical reality requires careful structuring.
LatAm’s third-largest market
52 million consumers. Third-largest population in Latin America after Brazil and Mexico. Fourth-largest economy by GDP. A genuine domestic-market scale that supports retail, financial services, telecoms, e-commerce, and consumer-product strategies in their own right — not just as a regional platform.
OECD member since 2020
Colombia formally joined the OECD in 2020 — the institutional and regulatory framework upgrades that accompanied accession (transfer pricing, corporate governance, anti-bribery, data protection, financial regulation) have materially improved the operating environment. One of only three OECD members in Latin America (with Mexico and Chile).
Nearshoring beneficiary
Alongside Mexico, Colombia is the standout LatAm beneficiary of the US/Western nearshoring shift. Direct US flights from major cities, time-zone alignment with US East/Central, lower cost than Mexico, strong English proficiency in Medellín and Bogotá, growing BPO/IT services sector. Major US tech and services groups have established operations specifically for this advantage since 2022.
Medellín tech ecosystem
Medellín has emerged as one of LatAm’s most dynamic technology hubs — transformed from its troubled past into a genuine innovation centre. Strong VC funding, Ruta N innovation centre, world-class talent pool from EAFIT and Universidad de los Andes networks. Home or significant presence: Rappi (LatAm super-app), Tul, Habi, Bold, addi, Truora, Mercado Bitcoin Colombia, and the LatAm offices of many global SaaS players.
SAS dominance — fast incorporation
The Sociedad por Acciones Simplificada (Law 1258/2008) is the most flexible major corporate form in Latin America. Single shareholder permitted, no minimum capital, custom bylaws, no mandatory revisor fiscal for most companies, no statutory audit below thresholds. ~95% of new Colombian companies are SAS. Standard formation 3 to 6 weeks — among the fastest in LatAm.
US-Colombia FTA & trade network
US-Colombia Trade Promotion Agreement in force since May 2012 — tariff-free access to the US market for the vast majority of products. EU-Andean Community FTA. UK-Andean FTA (post-Brexit). Pacific Alliance integration. FTAs with Canada, Chile, Mexico, Mercosur, South Korea, EFTA, Israel, Costa Rica and others. One of the broadest trade-agreement networks in Latin America.
Natural resources & commodities
Major oil and gas (Ecopetrol — majority state-owned). Coal exports significant globally. World’s #1 emerald producer. Gold, nickel, copper mining at scale. Coffee — world #3 producer and the Federación Nacional de Cafeteros remains globally significant. World #2 cut-flower exporter. Major banana, cocoa, sugar producer. Diversified commodity base.
Free Trade Zones (Zonas Francas)
Colombia operates one of the most developed free trade zone regimes in Latin America — 100+ zones nationwide. Qualifying entities access a reduced 20% corporate income tax rate (vs the 35% general rate), VAT and customs benefits, and simplified import/export procedures. Both permanent and special zones available. Particularly attractive for export-oriented manufacturing, BPO operations, and logistics hubs.
Floating peso, free FX
Colombian Peso (COP) floats on a market-based exchange rate with an independent central bank (Banco de la República). Free capital flows subject to FX registration via authorised intermediaries (typically Colombian banks). Free profit repatriation, dividend remittance, royalty payments, capital returns. Materially simpler than Argentina (cepo cambiario) or pre-2026 Brazil. Reporting obligations apply above standard thresholds.
Six legal structures — one usually fits.
For most foreign investors, the SAS is the practical default and has been since the 2008 reform — ~95% of new Colombian companies use this structure. The SA is required for capital-markets access and certain regulated activities. The Ltda. survives in legacy structures. Branch and rep office have specific narrow use cases. Free Trade Zone structures sit on top of these forms.
Sociedad por Acciones Simplificada
The dominant Colombian corporate form, introduced under Law 1258 of 2008. ~95% of new companies. Single shareholder permitted (corporate or individual). No minimum capital. Flexible bylaws with custom share classes, governance, exit terms. No mandatory revisor fiscal below revenue thresholds. No statutory audit below thresholds. Fast incorporation (1–2 weeks for entity, 3–6 weeks operational ready). The default for foreign investors.
Sociedad Anónima
Traditional corporation under the Commercial Code. Minimum 5 shareholders. Mandatory revisor fiscal (statutory auditor). Stricter governance and disclosure requirements. Required for: public securities offerings, BVC (Bogotá Stock Exchange) listing, financial institutions, insurance companies, pension fund managers. Used for larger operations, JVs, and regulated activities.
Sociedad de Responsabilidad Limitada
Traditional Colombian LLC structure. Between 2 and 25 partners. Partner consent required for transfers. Lost considerable ground to the SAS since 2008 and is rarely chosen for new foreign-invested operations. Still used in legacy family-business structures and where the partner-restriction is structurally desirable. The vehicle that the SAS effectively replaced.
Zona Franca Entity
SAS or SA structure registered as a Free Trade Zone user. Reduced 20% corporate income tax rate (vs 35% general). VAT and customs benefits on imports of inputs and capital goods. Simplified export procedures. Permanent zones (multi-user industrial parks) or Special zones (single-investor projects, typically requiring USD 30m+ investment). Particularly attractive for export-oriented manufacturing, BPO, and logistics.
Sucursal de Sociedad Extranjera
Foreign company conducting business in Colombia through a permanent branch. Registered with the Cámara de Comercio. Requires foreign capital registration with Banco de la República. Taxed at the 35% general rate on Colombian-source income with branch-specific remittance rules. Used where parent-level booking is structurally necessary — for most foreign investors, a SAS subsidiary is preferable.
Oficina de Representación
Foreign company representation only. Limited to liaison, market research, and promotional activities. Cannot generate revenue or sign binding commercial contracts. Lower setup cost. Used by groups exploring the Colombian market before committing to a full subsidiary. Less common than in many other markets since the SAS is itself fast and inexpensive to establish.
Talk to us first
SAS for almost all foreign-invested operations — the modern default. SA for listed entities, financial services, pension fund managers, public offerings. Free Trade Zone entity for export-oriented manufacturing/BPO with the 20% reduced CIT. Branch where parent-level booking is structurally necessary. Rep office for market exploration.
Book a call →From decision to live entity.
The end-to-end registration sequence for a Colombian SAS in Bogotá or Medellín, coordinated through our São Paulo office and senior local counsel. Standard timeline 3 to 6 weeks end-to-end — Colombia is one of the more efficient LatAm formation jurisdictions thanks to the SAS framework, with banking and FX registration being the long pole.
Structure & city decision
SAS (default), SA, Ltda., branch, ZF entity. City: Bogotá (financial services, multinationals, government-facing, largest market), Medellín (technology, innovation, growing nearshoring hub), Cali (services, agribusiness gateway), Barranquilla / Cartagena (ports, logistics, petrochemicals). Free Trade Zone option if export-oriented or BPO.
Foreign shareholder documents & legal representative
Foreign corporate shareholder documents (certificate of incorporation, articles, board resolutions appointing the Colombian representative) must be apostilled in country of origin and officially translated into Spanish by a Colombian-certified translator. A Colombian-resident legal representative is required for the company — either appointed from the foreign group or via Grant & Graham’s coordinated arrangements through senior local counsel.
Bylaws drafting (estatutos)
Draft bylaws in Spanish defining corporate purpose (objeto social), share structure, governance, registered office, fiscal year, dividend policy. For SAS, custom share classes, governance terms, and exit provisions can be embedded directly — one of the key advantages over the older Ltda. For SAS bylaws can be filed via a private document; SA requires public deed before a notary.
Cámara de Comercio registration
File the incorporation package with the local Cámara de Comercio (Chamber of Commerce) — in Bogotá, the CCB. The Chamber issues the Certificate of Existence and Legal Representation (Certificado de Existencia y Representación Legal), confirms the corporate registration, and issues a preliminary NIT (tax ID). Typical timing: 1 to 2 weeks for the registration.
CCB Bogotá →DIAN — NIT, RUT & tax registrations
Register with DIAN (Dirección de Impuestos y Aduanas Nacionales) and confirm the NIT (Número de Identificación Tributaria). Obtain the RUT (Registro Único Tributario) with applicable tax responsibilities (Renta, IVA, withholding agent, customs if applicable). Authorise electronic invoicing — mandatory for virtually all Colombian taxpayers since 2020.
DIAN →Banco de la República foreign capital registration
Foreign capital inflows must be registered with the Banco de la República through an authorised exchange intermediary (Colombian bank) using Form 4 (foreign investment registration). Mandatory regardless of size for all FDI. Required before dividend remittance, capital return, or sale of the foreign-held interest. Critical for clean FX repatriation downstream.
Municipal & sectoral registrations
Register with the municipality for ICA (Impuesto de Industria y Comercio) at the local rate (0.2–1.4% on gross revenue, varies by municipality and activity). Sector-specific licensing where applicable: financial services via Superintendencia Financiera (SFC), telecoms via MinTIC, healthcare via INVIMA, mining via ANM. Free Trade Zone qualification via DIAN if applying.
Bank account opening
Open the corporate bank account at a Colombian bank (Bancolombia, Banco de Bogotá, Davivienda, BBVA Colombia, Banco Popular, Itau Colombia, Scotiabank Colpatria). KYC including beneficial ownership disclosure, foreign shareholder documents (apostilled and translated), Certificado, RUT. COP operating account; USD account commonly opened in parallel. Typically the longest single step (2 to 4 weeks).
Social security & labour registrations
Register with the PILA (Planilla Integrada de Liquidación de Aportes) integrated payroll system. EPS (health), AFP (pension), ARL (occupational risk), parafiscal contributions (SENA, ICBF, Cajas de Compensación). Employer social charges total ~30–40% of gross salary. Strict compliance with Colombian Labour Code; collective bargaining provisions where relevant.
Ongoing tax, statutory & compliance
Annual corporate income tax return (Renta) by the assigned April deadline. Monthly or bi-monthly IVA returns (depending on size). Monthly ICA municipal returns. Monthly withholding tax filings (Retenciones). Monthly payroll/PILA filings. Mandatory electronic invoicing through DIAN’s validated platform. Transfer pricing for cross-border related-party transactions. Pillar 2 monitoring for in-scope multinationals.
What it costs to incorporate & run.
All figures are indicative for a standard SAS in Bogotá or Medellín with one foreign corporate shareholder. Colombia is one of the more cost-efficient LatAm formation jurisdictions for the entity itself — the SAS framework keeps incorporation costs low — though ongoing compliance is more involved than in Chile or Peru. SA structures cost more; Free Trade Zone entities require additional qualification work.
One-time setup
SA structure typically €6,500–11,000 (revisor fiscal, governance overhead). Free Trade Zone entity adds €3,000–6,000 for DIAN qualification and zone operator coordination. Branch setup €5,000–9,000 (additional FX registration complexity). Medellín marginally cheaper than Bogotá for legal services.
Ongoing monthly / annual
Revisor fiscal mandatory for SA, listed companies, financial institutions, and SAS exceeding revenue/asset thresholds. Transfer pricing documentation mandatory for cross-border related-party transactions above thresholds (mandatory comprehensive study). Medios magnéticos annual data submission to DIAN. Pillar 2 monitoring for in-scope MNEs.
Get an estimate in 30 seconds.
Three quick questions. We will give you a realistic cost range and timeline for your situation, and route the answers straight into a fixed-price quote request from our São Paulo office.
Which company structure are you considering?
How is the shareholding structured?
What do you need from us?
The legal framework to know.
A summary of the core legislation governing companies in Colombia. Substantive work delivered through Grant & Graham’s São Paulo office and senior Bogotá and Medellín legal, tax and accounting counsel.
Corporate Law
- Código de Comercio (Commercial Code)
- SAS Law Ley 1258 (2008)
- Sociedades por Acciones, S.A. framework
- Superintendencia de Sociedades oversight
Tax Law
- Estatuto Tributario (Tax Statute)
- Tax Reform Ley 2277 (2022)
- Free Trade Zone framework Ley 1004 (2005)
- Pillar 2 GMT implementation in progress
Labour Law
- Código Sustantivo del Trabajo
- Labour Reform Ley 2466 (2025)
- PILA integrated payroll system
- EPS / AFP / ARL social security
Data Protection
- Personal Data Protection Law Ley 1581 (2012)
- Decreto 1377 (2013)
- Superintendencia de Industria y Comercio (SIC)
- GDPR-aligned framework
Foreign Investment & FX
- Decreto 1068 of 2015 (FX regime)
- Banco de la República framework
- ProColombia (FDI promotion agency)
- US-Colombia TPA, EU FTA, Pacific Alliance
Intellectual Property
- Andean Community Decision 486 (industrial property)
- Andean Community Decision 351 (copyright)
- SIC (trademarks/patents)
- DNDA (copyright authority)
Colombia, answered.
Four steps from enquiry to live entity.
Discovery call
30-minute conversation to understand your business, sector, city preference (Bogotá vs Medellín vs other), SAS vs SA, Free Trade Zone eligibility, Petro reform impact assessment. Honest assessment of fit.
Recommendation
Senior advisory on the right structure, city, registered capital, Colombian-resident representative arrangements, banking partner, sector regulatory considerations, ZF qualification if relevant. Fixed quote in EUR or USD.
End-to-end formation
Bylaws, Cámara de Comercio filing, DIAN NIT/RUT/e-invoicing, Banco de la República Form 4, municipal ICA, PILA, banking, sector licensing. São Paulo-coordinated, executed through senior Bogotá/Medellín counsel.
Ongoing support
Retained accounting, monthly IVA/withholding/ICA, payroll/PILA, annual Renta and financial statements, medios magnéticos, revisor fiscal if applicable, transfer pricing, Pillar 2 monitoring, sector-specific compliance.
Ready to incorporate in Colombia?
Tell us in 25 minutes what you need. We will tell you honestly whether Colombia is the right fit, which structure makes sense (SAS, SA, Ltda., Free Trade Zone), whether Bogotá or Medellín is the right base, and how the Petro tax reform package affects your situation — then handle the setup end-to-end through our São Paulo office and senior Bogotá and Medellín counsel.