The Colombian tax authority ( DIAN) has issued Ruling 524 on 8 July 2024, which clarifies the currency regulations for foreign branches of Colombian companies. This ruling specifies that transactions conducted by foreign branches in currencies other than the Colombian peso (COP) must be reported in COP for tax purposes.
Recognition in COP: All income, costs, deductions, assets, and liabilities of foreign branches must be recognised in COP, using the exchange rate applicable at the time the transactions are accrued.
Compliance with Tax Code: This requirement aligns with Article 288 of the Colombian Tax Code, ensuring that foreign branches adhere to national tax regulations when reporting their financial activities.
The ruling aims to standardise the reporting process for companies operating internationally, thereby enhancing compliance and clarity in tax obligations for foreign branches.
