Colombia

Company Formation in Colombia

Republic of Colombia — Cámara de Comercio (RUE)

Formation Time

1–2 weeks

Min. Capital

No minimum

Corporate Tax

35% standard CIT (20% in Free Trade Zones)

Foreign Ownership

100%

Overview

Colombia is the fourth-largest economy in Latin America and the fastest-growing software development and digital nearshoring hub in South America. Strategically located at the northern gateway of South America, Colombia offers direct coastal access to both the Pacific and Atlantic Oceans. Under Law 1258 of 2008, Colombia revolutionized regional corporate law by creating the **Sociedad por Acciones Simplificada (SAS)** — an exceptionally flexible corporate vehicle that has become the most widely copied corporate statute across the Americas. A Colombian SAS can be incorporated with a single shareholder, requires no board of directors, permits broad commercial purposes, and offers complete limited liability protection. Medellín has earned global acclaim as Latin America's Center for the Fourth Industrial Revolution (WEF), while Bogotá represents a dynamic commercial metropolis of over 10 million consumers.

SAS single-shareholder vehicle

Medellin tech innovation capital

20% Free Trade Zone tax rate

OECD member

Low minimum investment visa

Why Choose Colombia

Sociedad por Acciones Simplificada (SAS) — Latin America's most modern and flexible corporate vehicle

Single-shareholder ownership permitted with zero minimum capital requirement

Medellín is Latin America's designated Center for the Fourth Industrial Revolution (WEF)

Top nearshoring software engineering destination with convenient US Eastern Time overlap

Free Trade Zones (Zonas Francas) offering preferential 20% corporate income tax rate

4th largest economy in Latin America with a population of 52 million people

Member of the OECD and Pacific Alliance (free trade with Mexico, Chile, and Peru)

Digital Nomad Visa and M-type Investor Visa providing direct residency pathways

Business Entity Types

Entity	Ownership	Directors	Capital	Tax	Best For
SAS (Sociedad por Acciones Simplificada)	100%	1 legal representative	None	35% corporate income tax (20% in Free Trade Zones)	Software development, digital marketing, BPO, e-commerce, consulting, foreign subsidiaries
Sucursal de Sociedad Extranjera	100%	1 legal agent in Colombia	Assigned capital required	35% CIT on Colombian branch earnings	Multinationals executing large public infrastructure or oil and gas contracts

Step-by-Step Formation Process

Chamber of Commerce Name Clearance

1 day

Search RUE database to verify corporate name availability.

Private Document of Constitution Execution

2–3 days

Execute SAS constitution under Law 1258.

Registration with Cámara de Comercio

3–5 business days

DIAN Tax Registration (RUT)

2–4 business days

Obtain corporate Registro Único Tributario (RUT) and digital certificate from DIAN.

Commercial Bank Account Opening

2–4 weeks

Open corporate COP and USD accounts with Colombian commercial banks.

Costs & Fees

Government / License Fee	USD 250+
Our Service Fee	USD 2,000 – 4,200
Annual Renewal	USD 800+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

Colombia has a modern commercial banking sector, dominated by Bancolombia, Banco de Bogotá, and Davivienda. Accounts can handle multi-currency transfers and digital collections.

Account Opening Time

2–4 weeks

Multi-Currency

Yes — multiple currencies supported

Recommended Banks

Bancolombia (largest bank in Colombia)Banco de BogotáDaviviendaBBVA ColombiaScotiabank Colpatria

Tax Overview

Corporate Tax

35% standard CIT (20% for companies operating in Free Trade Zones)

Personal Income Tax

0%–39% progressive personal income tax

VAT / Sales Tax

19% (IVA)

Capital Gains Tax

15% capital gains tax

Withholding Tax

20% on dividends paid to non-residents (subject to double tax treaty reductions)

Double Tax Treaties

15 countries

Colombia's Free Trade Zones (Zonas Francas) offer a reduced 20% corporate income tax rate and 0% VAT/customs duties on imported capital machinery and raw materials.

Visa & Residency

Digital Nomad Visa (Visa V Nómadas Digitales)

Up to 2 years

For remote workers earning approx. $1,400+ USD/month

Investor Visa (Visa M Inversionista)

Up to 3 years

Investment of 100 minimum monthly legal wages (~$35,000 USD) in Colombian entity

Family visa: AvailableProcessing: 1–2 months

Frequently Asked Questions

What is an SAS in Colombia?

The Sociedad por Acciones Simplificada (SAS), enacted under Law 1258 of 2008, is the most popular corporate structure in Colombia. It can be formed by a single foreign shareholder, does not require a board of directors, allows flexible voting rules, and protects shareholders with limited liability.

Do I need a resident legal representative in Colombia?

Yes. Under Colombian law, every company must appoint a legal representative (Representante Legal) who resides in Colombia and can represent the company before the National Tax and Customs Directorate (DIAN). Incorp International provides this statutory service.

Why is Medellín known as a premier tech nearshoring hub?

Medellín was named Latin America's Center for the Fourth Industrial Revolution by the World Economic Forum. With extensive tech incubators (Ruta N), high-speed fiber connectivity, and abundant software talent, it has attracted software development centers from across the US and Europe.

What is the Colombian Investor Visa?

Foreigners who invest at least 100 monthly minimum legal wages (approximately $35,000 to $40,000 USD) directly into the share capital of a Colombian SAS qualify for an M-type Investor Visa, which provides residency and work authorization in Colombia.

What is the tax rate in Colombian Free Trade Zones (Zonas Francas)?

Companies operating within a designated Colombian Free Trade Zone pay a preferential corporate income tax rate of 20% (instead of the standard 35%) and enjoy complete exemption from customs duties and VAT on imported equipment and raw materials.

Can foreign founders incorporate a Colombian company remotely?

Yes. By executing an apostilled Power of Attorney, foreign founders can establish an SAS, obtain the corporate RUT, and open commercial bank accounts without traveling to Colombia.