Why is Colombia a good destination for expanding my business?
Colombia is the fourth-largest economy in Latin America, with over 52 million inhabitants. It offers macroeconomic stability, a strategic location with coastlines on both the Pacific Ocean and Caribbean Sea, and free trade agreements with the United States, the European Union and more than 15 countries. It serves as the natural gateway to Latin America.
What is the economic stability like in Colombia?
Colombia has one of the most stable economies in the region, with a projected GDP exceeding USD 330 billion by 2025. The central bank maintains an active monetary policy to control inflation, which has been steadily decreasing.
Which economic sectors have the greatest potential?
The most dynamic sectors include technology, agriculture (coffee, flowers, avocados), tourism, renewable energy, manufacturing and BPO services. The government is also promoting the energy transition and the digital economy.
What is the labour force like in Colombia?
Colombia has a young population (median age 31 years), educated and increasingly bilingual, especially in professions such as engineering, IT and customer service. Labour costs are competitive compared to other countries in the region.
What free trade agreements does Colombia have?
Colombia has 17 active trade agreements, including with the United States, Canada, the European Union, Mexico, Chile, Mercosur, South Korea, Japan and the United Kingdom. This facilitates preferential access to more than 1.5 billion consumers.
Is Colombia safe for investment?
Major cities (Bogotá, Medellín, Cali, Barranquilla) are modern and secure business hubs. As with any country, standard precautions are recommended, along with location-specific security assessments.
How is the business climate?
Colombia has consistently improved its ranking in ease of doing business. The government actively promotes foreign investment through ProColombia and offers incentives such as Free Trade Zones and legal stability contracts.
Is there currency risk?
The Colombian peso can be volatile against the US dollar. However, hedging mechanisms exist and certain sectors can invoice in US dollars. We advise on mitigating this risk.
What are the main cities for doing business?
Bogotá is the financial and political centre. Medellín is the innovation and technology hub. Cali is key for the Pacific region and agribusiness. Barranquilla is the most important industrial port on the Caribbean coast.
What languages are spoken in business?
Spanish is the official language. However, in the corporate sector and among multinational companies, English is widely used. Our team is fully bilingual.
How is the logistics infrastructure?
Colombia has invested heavily in road infrastructure (4G highways), ports (Cartagena, Buenaventura, Barranquilla) and airports. Connectivity is rapidly improving.
What government incentives exist?
Free Trade Zones with tax benefits, legal stability contracts, deductions for investment in innovation and technology, and special programmes for the orange economy and renewable energy.
Does Colombia respect foreign investment?
Yes, the constitution and Colombian laws guarantee equal treatment for domestic and foreign investors. Government approval is not required for most investments.
How is the air connectivity?
Colombia has excellent connectivity with direct flights to Madrid, Paris, Frankfurt, Amsterdam, London, New York, Miami, Mexico City, São Paulo and many other key cities.
What Free Trade Zones exist?
There are over 100 permanent and special Free Trade Zones throughout the country, offering benefits such as a 20% corporate income tax rate (vs 35% general) and VAT exemption on imported raw materials.
🏢 2. Company Formation
What type of company do you recommend?
The Simplified Stock Corporation (Sociedad por Acciones Simplificada - SAS) is the most recommended for foreign investors due to its flexibility, low cost and simplicity. It can be incorporated by a single shareholder and does not require a board of directors.
What is an SAS?
An SAS is a capital company with liability limited to the amount of contributions. It offers great contractual flexibility, may have an indefinite duration and its incorporation is agile through a private document.
What is a Corporation (SA)?
An SA (Sociedad Anónima) is a more traditional structure requiring a minimum of five shareholders, a mandatory board of directors and a statutory auditor. It is ideal for companies planning to list on the stock exchange or operating in regulated sectors such as banking.
What is a branch of a foreign company?
A branch is an extension of the head office, not an independent legal entity. The parent company bears unlimited liability for the branch's obligations. It is useful for specific projects such as hydrocarbons or mining.
How long does it take to incorporate a company?
With Nexorae, the entire incorporation process can take between 2 and 4 weeks, depending on the complexity and the speed of obtaining apostilled documents from abroad.
How much does it cost to incorporate a company?
Costs typically range between USD 500 and USD 1,000, including commercial registry, registration tax (0.7% of capital), and professional fees. The minimum capital required is low (approximately COP 500,000 or USD 130).
Can a foreign company own 100% of a Colombian company?
Yes, in the vast majority of economic sectors there is no restriction. You can be the sole shareholder of your Colombian company. Only national television channels have a 40% limit on foreign investment.
Do I need a Colombian partner?
No, a local partner is not required. You can be the sole shareholder of your Colombian company.
What is the NIT?
The NIT (Número de Identificación Tributaria) is the unique tax registration number before the DIAN. It is like the Mexican RFC or the US EIN. You obtain it during the incorporation process.
What is the RUT?
The RUT (Registro Único Tributario) is the form containing all taxpayer information: identification, address, economic activity, and tax responsibilities (VAT, withholding tax, etc.).
What documents do I need for incorporation?
1) Apostilled passports of shareholders and legal representatives. 2) Apostilled certificate of existence and legal representation of the parent company. 3) Power of attorney (if applicable). 4) Bylaws of the new company.
What is an apostille?
An apostille is a method of legalising international documents according to the Hague Convention. Colombia accepts it. Your corporate documents must be apostilled in the country of origin and then officially translated.
Do I need to translate the documents?
Yes, all documents in a foreign language must be officially translated into Spanish by a certified translator in Colombia.
Where is the company registered?
At the Chamber of Commerce of the city where it will have its main domicile. There you obtain the Commercial Registry and register the NIT with the DIAN.
Can I have a 100% digital company?
Yes, many procedures are electronic through the RUES portal. However, you need a physical address for notifications and for the commercial registry.
What is foreign investment registration?
It is a procedure before the Bank of the Republic to register capital contributions from abroad. This gives you the right to repatriate dividends and capital in the future through the official foreign exchange market.
Is foreign investment registration mandatory?
Yes, it is mandatory to access foreign currency and repatriate profits. If you do not register, you will not be able to legally transfer dividends abroad and may face fines.
What happens if I do not register the investment?
You may face fines from the Superintendence of Companies and will not have access to the official foreign exchange market to withdraw foreign currency. You would have to rely on the informal market.
Can I change the corporate purpose later?
Yes, through a bylaw amendment that must be registered with the Chamber of Commerce. It is a relatively simple procedure.
Can I increase the capital later?
Yes, through a bylaw amendment or through supplementary contributions (simpler). Everything must be registered.
⚖️ 3. Legal & Regulatory Aspects
Are there sectors prohibited for foreign investment?
Yes, investment is prohibited in: 1) National defence and security activities. 2) Processing and disposal of toxic, hazardous or radioactive waste not produced in Colombia.
Are there limits on land ownership?
Foreigners cannot acquire state-owned vacant lands (baldíos) in border areas. For rural properties near coasts or borders, there are special regulations that we can review.
What is the judicial system like?
Colombia has a civil law tradition. The judicial system is divided into jurisdictions (ordinary, administrative, constitutional). Contracts are generally respected.
Which entities regulate companies?
The main ones are: 1) DIAN (taxes and customs). 2) Superintendence of Companies (corporate supervision). 3) Ministry of Commerce. 4) Bank of the Republic (foreign exchange).
What is the Superintendence of Companies?
It is the entity that monitors and controls commercial companies. It receives financial statements, investigates possible irregularities and can impose sanctions.
How are commercial disputes resolved?
They can be resolved in ordinary courts or through national or international arbitration. Colombia is party to treaties such as ICSID (World Bank) for investment protection.
What is the transfer pricing regime?
It is the obligation to report and document transactions with related parties abroad, demonstrating that they were conducted at market prices. It applies to companies with international operations.
What is a branch vs a subsidiary?
A subsidiary (SAS or SA) is an independent legal entity with limited liability. A branch is an extension of the head office, which has unlimited liability.
Can I have a holding structure?
Yes, it is common to establish a holding company in Colombia or abroad to manage investments in the region. We can advise you on the best structure.
How is a company dissolved?
The process includes: shareholder approval, appointment of a liquidator, payment of liabilities, distribution of the remainder and cancellation of the commercial registry.
Is there intellectual property protection?
Yes, Colombia is a member of WIPO and has a robust system for registering trademarks, patents and copyrights with the Superintendence of Industry and Commerce (SIC).
What is the "ultimate beneficial owner"?
It is the natural person who ultimately owns or controls the company. Since 2022, it is mandatory to report this information to the DIAN and the Superintendence to prevent money laundering.
💰 4. Taxation
What is the corporate income tax rate?
The general rate for 2025 is 35% on taxable income. This is one of the most competitive rates in the region.
What is VAT and what is its rate?
VAT (Value Added Tax) is 19% on most goods and services. Some products have differential rates (5% or are excluded).
What is ICA?
ICA is the Industry and Commerce Tax, a municipal tax on gross income from industrial, commercial or service activities. The rate varies between 0.2% and 1.4% depending on the municipality and activity.
What is withholding tax?
It is a mechanism for early collection of income tax and ICA. The payer withholds a percentage and pays it to the DIAN. Rates vary from 1% to 11% depending on the concept.
What taxes apply to dividends?
Dividends distributed to foreign shareholders: 1) If they come from profits already taxed with corporate income tax, they pay 20% withholding. 2) If they come from untaxed profits, they first pay corporate tax (35%) and then 20% on the remainder.
How are branches taxed?
Branches are taxed only on their domestic source income, at the general rate of 35%. The head office is jointly liable.
Is there a wealth tax?
Yes, there is a wealth tax for individuals and companies with net worth exceeding approximately USD 634,900. Rates range from 0.5% to 1.5%.
Can I offset tax losses?
Yes, tax losses can be offset against future income indefinitely, with no time limit. They cannot be carried back to previous years.
What is a Free Trade Zone?
It is a delimited geographic area with a special tax regime: 20% corporate income tax rate (vs 35%), and VAT and customs duty exemption for imported goods used in the zone.
What double taxation treaties does Colombia have?
Colombia has treaties in force with: Spain, Chile, Mexico, Canada, Switzerland, South Korea, Japan, India, United Kingdom, Portugal, Czech Republic, and the Andean Community. Negotiations with the United States and other countries.
How do double taxation treaties work?
They reduce withholding taxes on dividends, interest and royalties, and prevent you from paying taxes in both countries on the same income.
What is the simple taxation regime?
It is an optional regime for small and medium-sized enterprises that consolidates several taxes (income, ICA, VAT) into a single monthly payment. It is generally not advantageous for foreign companies.
When is the corporate income tax return filed?
Legal entities file their income tax return annually, generally between March and April of the year following the taxable year. Exact dates are published by DIAN based on the last digit of the NIT.
What penalties exist for not filing?
Fines can reach up to 200% of the tax due, closure of the establishment for 30 days, and blocking of foreign trade operations.
Can I issue electronic invoices?
Yes, electronic invoicing is mandatory. You must enable an electronic invoicing system authorised by the DIAN.
🏦 5. Banking
Can I open a bank account as a foreigner?
Yes, both foreign individuals and legal entities can open accounts in Colombia. The main banks are Bancolombia, Davivienda, BBVA, Banco de Bogotá and Scotiabank Colpatria.
What documents do I need for a corporate account?
1) Certificate of existence and legal representation (issued by the Chamber of Commerce). 2) Company NIT. 3) Identification of the legal representative (foreigner ID card or passport). 4) Bank references. 5) Financial statements.
How much does it cost to open an account?
The cost varies between USD 100 and USD 300 for study and opening fees. Some banks may require a minimum initial deposit.
How long does it take to open the account?
The process can take between 1 and 3 weeks, depending on the bank and the completeness of the documentation.
Can I have a US dollar account?
Yes, foreign currency accounts (US dollars, euros) exist to manage foreign currency without having to convert to pesos. They are useful for exporting companies or those with US dollar cash flow.
What is the "bank reserve requirement"?
It does not apply to current accounts. There is no mandatory minimum balance requirement (although some banks require average balances to waive management fees).
Can I operate the account remotely?
Yes, online banking in Colombia is highly developed. You can make transfers, payments and queries online.
What is the "bank certificate" for foreign investment?
It is a document issued by the bank certifying the entry of foreign currency into the country, necessary to register foreign investment with the Bank of the Republic.
Can I have an account without being a resident?
Yes, you can open an account as a non-resident, but the bank will require apostilled documents and there may be restrictions on certain products.
How do I transfer dividends abroad?
You must have the foreign investment registered, submit the foreign exchange declaration form, and the bank will channel the operation at the official exchange rate.
👥 6. Employment & Payroll
What is the minimum wage in Colombia?
For 2025, the monthly minimum wage is approximately COP 1,746,882 (about USD 446). In addition, there is a transport subsidy of COP 200,000 for those earning less than 2 minimum wages.
What social benefits must the employer pay?
In addition to salary, the employer pays: 1) Severance pay (8.33% of annual salary). 2) Service bonus (8.33% semi-annually). 3) Interest on severance pay (1% monthly on severance). 4) Vacation (4.17% of annual salary). Total: approximately 30% additional.
It is an entity that provides benefits to workers (subsidies, education, recreation). Employers contribute 4% of monthly payroll.
What are SENA and ICBF?
They are public entities financed with payroll contributions: SENA (National Learning Service) 2% of payroll, ICBF (Colombian Institute of Family Welfare) 3% of payroll.
How much does an employee cost in total?
The total cost for the employer is approximately 1.5 to 1.7 times the base salary, including benefits, social security and payroll taxes.
What types of contracts exist?
1) Fixed-term (up to 3 years, renewable). 2) Indefinite-term. 3) Work or labour. 4) Service provision (independent, no employment relationship).
How does the probationary period work?
Maximum 2 months for indefinite-term contracts. During this period, either party may terminate without compensation.
What happens if I dismiss an employee?
It depends on the type of contract and the cause. Dismissals without just cause generate compensation: 30 days' salary if less than 1 year, and additional amounts based on seniority.
What vacation time do employees have?
They are entitled to 15 working days of vacation per year worked. They must be taken within the following year.
What is the service bonus?
It is a social benefit equivalent to one month's salary per year, paid in two halves: June and December.
What are severance payments?
They are employee savings equivalent to one month's salary per year, which the employer pays before 15 February to a severance fund. The employee can withdraw them for housing or education.
🏢 7. Office & Infrastructure
How do I find an office in Bogotá?
We help you search according to your needs: traditional areas (Chapinero, Salitre), exclusive areas (Usaquén, Chico), or corporate centres (Santa Bárbara, 100 Street). Options range from coworking to corporate buildings.
How much does it cost to rent an office?
The price varies by area: from USD 15 to USD 35 per square metre per month in prime areas. A space for 10 people can cost USD 2,000-4,000 per month.
What is a coworking space?
Shared office spaces with included services (internet, meeting room, cafeteria). Ideal for starting without large investments. Regus, WeWork and Spaces have presence.
How do I contract internet and services?
The main providers are Claro, Movistar, Tigo and ETB. They offer business plans with fibre optics, IP telephony and dedicated support.
Do I need a physical address for the company?
Yes, for the commercial registry you need an address in Colombia. It can be your office or a virtual address if you use coworking.
How do I set up corporate email?
We help you configure Google Workspace or Microsoft 365 for your domain, with emails like name@yourcompany.co.
What do I need for IT infrastructure?
Computers, servers (physical or cloud), software licences, firewall, corporate antivirus, and technical support. We advise you on everything.
Are there cybersecurity requirements?
Yes, especially if you handle personal data (Law 1581 on Data Protection). You must implement technical and organisational security measures.
🛂 8. Visas & Relocation
What visa do I need to work in Colombia?
The most common visas for executives are the Business Visa (M) or Worker Visa (R). The M visa allows you to work for a specific company. The R visa is for residents.
Can I be a legal representative with a business visa?
Yes, you can be a legal representative with a business visa (type M). It is not necessary to be a permanent resident.
How do I obtain the foreigner ID card?
Once the visa is approved, you must register with Migración Colombia and obtain your foreigner ID card, which is the identification document for foreigners.
Can I bring my family?
Yes, certain visa types allow you to include spouse and children as beneficiaries. They will obtain the same immigration status.
How long does it take to obtain a visa?
The process can take between 1 and 3 months, depending on the visa type and document completeness. We assist with the entire process.
What documents do I need for the visa?
Valid passport, company letter, certificate of existence of the Colombian company, apostilled criminal background check, and completed forms.
How do I find housing for my team?
We help with searching for furnished or unfurnished apartments in exclusive areas, lease agreement management, and utilities.
What about schools for my children?
Bogotá has excellent international schools (bilingual, American, British, German, French). We advise on options based on location and curriculum.
1) Renew the commercial registry (by 31 March). 2) File income tax return (March-April). 3) Hold annual shareholders' meeting. 4) File financial statements.
What is commercial registry renewal?
It is an annual mandatory procedure before the Chamber of Commerce to keep the company's registration valid. It is done between January and March.
What accounting books must I keep?
Minutes book, shareholders' book, journal, ledger, and financial statements. They can be physical or electronic (these must be registered).
Do I need a statutory auditor?
It is mandatory if: 1) The company has assets exceeding 5,000 minimum wages (~USD 2.2 million). 2) It is an SA. 3) Required by bylaws. In a small SAS it is not mandatory.
What is a "commercial establishment"?
It is the physical location where you operate. It must also be registered with the Chamber of Commerce and renewed annually.
How do I handle cash?
Cash transactions are limited. Payments over COP 10 million (~USD 2,500) must be made through the financial system.
What is electronic invoicing?
It is a mandatory system where each invoice must be electronically validated by the DIAN before being delivered to the customer.
🤝 10. About Nexorae
What sets Nexorae apart from other providers?
We are an integrated partner: we not only incorporate the company, but also manage your day-to-day operations. A single point of contact for legal, accounting, labour, IT and administrative matters.
What languages do we work in?
Our team is fully bilingual (Spanish-English). All contractual and operational communication can be in English. We also serve clients in Portuguese and German.
Do you work with companies of any size?
Yes, from tech startups with a single employee to multinationals establishing a subsidiary with 50+ people. Our services scale with you.
How does the process to start work with you work?
Step 1: Contact and free initial consultation. Step 2: Service proposal and personalised quote. Step 3: Agreement signing and start of incorporation. Step 4: Operations running with ongoing support.
How much do your services cost?
It depends on the scope: from basic incorporation packages to comprehensive monthly operation services. Contact us for a no-obligation quote.
Do you have physical offices?
Yes, we are located at Calle 110 # 9 - 25 Ofi 1010, Bogotá. You are welcome to visit us.
How do I contact Nexorae?
Email: contact@nexorae.co
Do you offer Employer of Record (EOR) services?
Yes, we can be your Employer of Record in Colombia, hiring your employees locally without needing to incorporate a company.
Still have questions?
Our team is ready to help you with any specific questions about your expansion to Colombia.