Selling Property in Colombia as a Foreigner

Ganancia Ocasional: The 15 Percent Tax on Your Gain

Colombia taxes the profit on the sale of real property held for two years or longer as ganancia ocasional, at a flat 15 percent, under Articles 314 and 316 of the Estatuto Tributario as amended by Law 2277 of 2022, which raised the rate from 10 percent. This rate applies the same way to Colombian tax residents and non-residents.

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Sell within two years of acquiring the property and the occasional gains rate does not apply at all. The profit is instead added to your ordinary income. For non-resident sellers, that means Colombia's flat 35 percent rate on Colombian-source income under Article 247 of the Estatuto Tributario. For tax residents, it means the progressive schedule that tops out at 39 percent.

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The taxable gain is the sale price minus your adjusted fiscal cost. The sale price used is whichever is higher: the price stated in the escritura pública or the property's official cadastral value. Understating the deed price to shrink the taxable gain does not work, because DIAN measures against the cadastral value regardless of what the deed says.

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Your adjusted fiscal cost is built from four things: the original purchase price, the annual reajuste fiscal under Article 70 of the Estatuto Tributario (the greater of your acquisition cost or that cost adjusted upward for each year you held the property), documented capital improvements supported by electronic invoices, and the notarial and registration fees and any valorización contributions you actually paid at the time of purchase. Every one of these needs paperwork behind it. An improvement you cannot back with a facturación electrónica does not reduce your taxable gain.

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Article 311-1 of the Estatuto Tributario exempts up to 5,000 UVT of gain, 261,870,000 pesos in 2026, on the sale of a primary residence, provided the proceeds go into an AFC account or toward paying down the mortgage. This exemption is written for Colombian tax residents: an AFC account is a resident savings vehicle, and the exemption requires one. Foreign owners who are not Colombian tax residents at the time of sale do not qualify for it, regardless of how long they have owned the property. For the full picture of what foreign owners owe beyond this one sale, see our guide to real estate taxes in Colombia.

The 1 Percent Withholding at Closing

Article 398 of the Estatuto Tributario requires a 1 percent withholding on the declared sale price, collected by the notary before the escritura pública is signed. The notary will not authorize the deed without proof that this has been paid.

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This withholding is an advance, not your final bill. It is credited against the actual ganancia ocasional or ordinary income tax you owe once your annual return is filed, and depending on your real gain, that can mean an additional payment or a refund.

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This is an area to watch rather than treat as settled. Decreto 572 of 2025 attempted to introduce a tiered withholding schedule keyed to the property's declared value, but that decree has been under provisional suspension by court order since May 2026, confirmed by DIAN's Comunicado 070. The flat 1 percent stays in force while the suspension holds. If that changes, the withholding due at your specific closing changes with it, which is why we confirm the applicable rate at the time of your sale rather than relying on what applied a year earlier.

Filing Your Tax Return

The withholding collected at closing does not close out your obligation to DIAN. The actual gain, whether taxed as ganancia ocasional or as ordinary income, is settled the following year on the standard annual income tax calendar, which assigns filing windows by the last digits of your NIT. Non-resident sellers with no other Colombian income still have to file, because that return is what reconciles the 1 percent already withheld against your real gain and either produces a refund or a balance due.

Repatriating the Proceeds

Two separate registrations need to be in order before proceeds can leave Colombia cleanly, and they sit on opposite ends of the transaction.

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The first happens at the time of the original purchase. Capital wired in from abroad to buy the property should have been registered with the Banco de la República on Formulario No. 4. That registration is what establishes your derechos cambiarios, the currency rights that let you later move money out of Colombia through the official exchange market.

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The second happens at the time of sale. The outbound transfer of your proceeds is filed under numeral 4560, the classification covering transfers abroad for the total or partial liquidation, sale, or reduction of a foreign investment, submitted electronically through the Banco de la República's foreign exchange information system. You have six months from the date of the transaction to file or amend this registration.

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Skip either registration and the consequences are concrete. You lose your derechos cambiarios over the investment, you cannot justify the origin of the funds when moving them abroad, and exchange control violations can draw sanctions of up to 200 percent of the value of the infraction. If Formulario No. 4 was never filed when you originally bought the property, that gap has to be closed before the sale proceeds can be repatriated, and it needs to be dealt with before you list the property, not after you have already signed a promesa de compraventa with a buyer.