Colombia's wealth tax — Impuesto al Patrimonio — is a tax levied on the net worth of certain individuals and entities. It made headlines when the 2022 Tax Reform (Ley 2277) reintroduced it with new progressive rates. For high-net-worth foreigners living in Colombia or holding significant Colombian assets, this is a critical planning consideration.
Who Is Subject to the Wealth Tax?
The wealth tax applies to:
- Colombian tax residents (individuals) with worldwide net worth exceeding COP 72 billion (~USD 17–18 million) as of January 1st of the tax year
- Non-residents who hold assets in Colombia directly (not through a Colombian company) exceeding the same threshold
- Certain foreign companies holding Colombian assets (subject to conditions)
Wealth Tax Rates (2023 onward)
| Net Worth (COP billions) | Rate |
|---|---|
| 0 – 72 | 0% — Not subject |
| 72 – 122 | 0.5% |
| 122 – 239 | 1.0% |
| Over 239 | 1.5% |
What Assets Are Included?
For Colombian tax residents, the wealth tax base includes all worldwide assets (minus liabilities). This includes:
- Real estate (in Colombia and abroad)
- Bank accounts and investment accounts
- Shares in Colombian and foreign companies
- Vehicles, boats, and personal property
- Cryptocurrency and digital assets
- Accounts receivable and loan assets
What Assets Are Excluded?
- The primary residence, up to a value of 13,500 UVT (~COP 640 million)
- Assets held through a Colombian company (the company structure separates personal and corporate wealth)
Planning Strategies for Expats
- Invest through a Colombian SAS: Assets owned by a company are the company's — not yours personally. This can keep you below the wealth tax threshold.
- Manage residency timing: Your residency status on January 1st of the tax year determines if worldwide assets are counted.
- Document liabilities carefully: Mortgages, business loans, and other debts reduce the taxable base.
- Work with a CPA proactively: Structuring before the threshold is crossed is far more effective than reacting after.
Who Does NOT Need to Worry
The vast majority of expats and foreign investors in Colombia will not be subject to the wealth tax, given the high threshold (~USD 17M). However, high-net-worth individuals — especially those with real estate portfolios or business interests — should monitor their exposure annually.