The resolution establishes the criteria for determining the ultimate beneficial owner that should be reported before the Colombian Tax Authority, as well as the information to be reported, the technical requirements for reporting the information and the deadlines for submitting the information.
On 27 December 2021, the Colombian Tax Authority issued Resolution No. 164, establishing the criteria for identifying the ultimate beneficial owner (UBO) of legal entities or structures without legal status (individuals that (1) are the owners of, (2) control or (3) benefit from, the relevant entity), as well as the information that will be compiled in the UBO registry (RUB, per its acronym in Spanish).
This Tax Alert highlights the most significant aspects of Resolution No. 164.
Who must provide information about UBOs?
The following legal entities or structures must submit information about UBOs:
- Colombian companies or entities (i.e., tax residents), for profit or non-profit, including public companies and public-private companies
- Permanent establishments (including branches) in Colombia of nonresident entities
- Structures without legal personality, or similar structures,1 when:
- They are created or managed in Colombia
- They are governed by Colombian rules
- The trustee (or equivalent) is a tax resident in Colombia
- Foreign entities or structures without legal personality when, according to the financial statements, the foreign entity derives more than 50% of the value of its total assets from assets located in Colombia
Who must be reported as UBO?
The following table sets out who must be reported as a UBO:
| Type of entity | Person to be reported as UBO |
| Legal entities |
|
| Structures without legal personality | Individuals who have any of the following qualifications:
For conditional beneficiaries, the conditions must be indicated in the RUB; when the conditions are met, the RUB must be updated to report those beneficiaries. |
When a structure without legal personality holds (directly or indirectly) shares/interests in a legal entity or has any of the roles mentioned above with respect to another structure without legal personality, the structure must report its UBOs.
Specific rules are established for entities in the ownership chain that issued bearer shares or have nominal shareholders.
Information that must be reported
Taxpayers must report the following information about UBOs:
Document used to verify the individual’s identity (e.g., passport, Colombian ID or foreign ID)
ID number from the document used to verify the individual’s identity and country of issuance
Tax ID number or equivalent and country of issue (if the individual has a Colombian Tax ID, this should preferably be reported)
First and last name
Date and country of birth
Country of nationality
Information about country of residence, state, city, address, zip code and e-mail
Criteria for determining the UBO
Percentage of ownership in the capital of the legal entity
Percentage in the legal entity or structure without legal personality’s profits
Date from which the individual is considered a UBO or the status of UBO is subject to a condition
Date from which the individual ceases to be the UBO or the condition to be deemed the UBO ceases to exist
How should the information be provided?
Taxpayers must report the UBO information through the RUB electronic system. Resolution 164 contains a technical annex with the technical specifications of the information to be reported.
Structures without legal personality that are not required to register before the Colombian Tax Registry (RUT, per its acronym in Spanish) must register before the Identification System of Structures without Legal Personality (SIESPJ, per its acronym in Spanish).
Deadlines to report UBOs
The following deadlines apply for reporting UBOs:
| Initial report | Legal persons and structures without legal status created before 15 January 2022: 30 September 2022 Legal persons and structures without legal status created as of 15 January 2022: Within two months of the registration before the RUT or the SIESPJ (as applicable) |
| Updates | Changes in information reported to RUB as of 1 January, 1 April, 1 July, and 1 October of each year: Update within a month of those dates |
Due diligence to report UBOs
Legal persons and structures without legal status (or similar structures) must carry out all the necessary procedures to properly identify their UBOs, including identifying the corresponding chain of ownership and control. If they cannot identify one or more of the UBOs after carrying out all available procedures, they must report that to the RUB, with the reasons one or more UBOs cannot be identified.
The supporting documentation for identifying the UBOs must be kept for five years, beginning 1 January of the year following the one in which the UBOs are reported, updated or deleted from the RUB or SIESPJ (as applicable).
For additional information with respect to this Alert, please contact the following:
Ernst & Young S.A.S. Bogota
- Luis Orlando Sánchez
- Juan Torres Richoux
- Andrés Millán Pineda
- Amalia Borja Gonzalez
- Isabel Rodriguez Daniels
Ernst & Young LLP (United States), Latin American Business Center, New York
- Zulay Andrea Arevalo
- Ana Mingramm
- Lucas Moreno
- Enrique Perez Grovas
- Pablo Wejcman
- Pablo Angel
Ernst & Young Abogados, Latin America Business Center, Madrid
- Jaime Vargas
Ernst & Young LLP (United Kingdom), Latin America Business Center, London
- Lourdes Libreros
- Claudia V León Campos
Ernst & Young Tax Co., Latin America Business Center, Japan & Asia Pacific
- Raul Moreno, Tokyo
- Luis Coronado, Singapore
For a full listing of contacts and email addresses, please click on the Tax News Update: Global Edition (GTNU) version of this Alert.
