Handling banking, money and taxes in Colombia comes with its share of bureaucracy. The language barrier may also mean that expats have to enlist the help of a Spanish friend or translator.
As in any country, tax matters can become complex. It may be worthwhile for expats to hire a tax professional to ensure they remain on the right side of the law.
Money in Colombia
Colombia's currency is the Colombian Peso (COP). Unlike most other currencies which are usually subdivided into cents or an equivalent, the peso is the lowest unit of Colombian currency. It isn't further subdivided.
Notes: 1,000 COP, 2,000 COP, 5,000 COP, 10,000 COP, 20,000 COP and 50,000 COP
Coins: 5 COP, 10 COP, 20 COP, 50 COP, 100 COP, 200 COP, 500 COP and 1,000 COP
Banking in Colombia
Banking in Colombia is a relatively straightforward process. Expats will find that as long as they have the correct documents, opening a bank account is simple. It's also easy to find ATMs and most places accept credit cards.
Opening a bank account
Expats wishing to open a savings account or current account can do so at a local Colombian bank or a multinational bank such as HSBC or CitiBank.
There are several documents required to open a bank account. These vary from bank to bank but usually include a Cedula de Extranjería (Colombian ID document for foreigners), passport and visa, proof of address, and proof of employment and income. Some banks may ask for references or require a Colombian guarantor – expats usually find that employers are willing to fulfil these requirements.
Applications usually take about two weeks to process. Expats will be notified of the approval and will need to go to the bank to fetch their new card.
Credit cards and ATMs
Expats are unlikely to be granted a credit card from a Colombian bank unless they already have an existing credit record in the country or have been banking in Colombia for six months or more. New arrivals in need of a credit card will either have to bring one from home and possibly bear steep transaction fees or else apply for a credit card with an international bank in Colombia. References from a previous bank back home can boost their chances of approval.
In major cities, credit cards are accepted just about anywhere including shops, hotels and restaurants. Expats should, however, not be surprised if they're asked to present some form of identification before they can pay with a credit card. In smaller towns, places that accept credit cards may be few and far between. Similarly, ATMs are easy to find in big cities but can be scarce in smaller towns.
Some ATMs only offer withdrawals at certain hours of the day or place a limit on withdrawal amounts at night for safety reasons. Expats should be aware of their surroundings at all times while using an ATM and should be wary of anyone loitering close by.
Taxes in Colombia
Tax in Colombia is either deducted monthly from a salary or paid in an annual tax return. Tax return submissions usually close around April or May each year and there is a penalty for filing tax returns late.
Full-time residents – foreigners who are in Colombia 183 days or more within a tax year – must pay tax on their total worldwide income. Those who spend fewer than 183 days a year in Colombia are only taxed on their earnings from within the country.