Property Sales Tax and Capital Gains for Foreigners in Colombia: DIAN Withholding and Rates

The short version: before you accept any number from the notary, confirm two things: whether you are a Colombian tax resident, and whether you have held the property for two years or more. Those two answers decide which rule applies, and mixing them up is the most common way sellers end up confused at the deed signing.

Most foreign owners I hear from assume there is one percentage, usually the 1% they read about somewhere, and that it settles everything. It does not. Withholding at closing is a prepayment collected on one base. The tax on your profit is calculated on another. This guide keeps them apart, because the DIAN rules do. Confirm your title is clean first, since tax is a secondary problem if the title is not. Our guides on buying property as a foreigner and on falsa tradición and title checks cover that step.

Residence, not passport, decides which rule applies

For a natural person, income from selling a fixed asset is subject to withholding of 1% of the sale price (Estatuto Tributario art. 398). For real estate, that amount is paid to the notary before the transfer. That is the rule most articles quote, and it is correct for a resident seller.

But it is only half the picture. If the seller is a natural person who is not a Colombian tax resident, DIAN treats the sale of Colombian real estate under the payments-abroad rules in articles 406 and 415, not under article 398. Nationality and visa type are not the test. A foreigner who lives in Colombia and meets the residence criteria is on one side; a Colombian citizen who is a non-resident for tax purposes can be on the other.

Either way, the amount withheld is not your final tax. It is credited against what you owe once the gain is calculated, which is why the next section matters more than the percentage on the notary's sheet.

The two-year test and the 15% tax on the gain

A sale is an occasional gain (ganancia ocasional) when the asset was a fixed asset for two years or more. The gain is the sale price minus the fiscal cost. When the regime applies, the tax rate is 15% of that gain for a resident individual, a non-resident individual, and a national or foreign company. Note the wording: 15% of the gain, not 15% of the sale price.

If you held the property for less than two years, the profit is ordinary income, not an occasional gain. Ordinary income has its own rate schedule that your return has to compute, and I will not guess a percentage for you because it depends on your other income that year.

Quick comparison

One honest downside: fiscal cost is the part sellers document worst. Keep the original deed, receipts for improvements and anything else that proves what you actually invested. Without paper, your cost looks lower and your gain looks bigger.

The deed price: cadastral value, side payments and the 15% test

Many sellers think a low price on the deed saves tax. In practice it is the fastest way to create a problem. For real estate, the tax price is not accepted below the fiscal cost, the cadastral value, or the self-appraisal, and it can be higher.

• Cadastral value is a floor on the price, not your cost basis. A common mistake is to subtract it as if it were what you paid.
• Side payments count. Amounts paid outside the deed for improvements, construction or brokerage are part of the price.
• The 15% commercial test. DIAN may reject a price that differs by more than 15% from commercial prices for similar assets, considering condition and state.
• The sworn statement. If the deed lacks the declaration that the written price is real and that no different private price exists, income tax, occasional gain, registration tax and notary fees are liquidated on four times the price written in the deed.

So understating the price, or paying a balance under the table, can raise your tax base and is the wrong way to save money. For purchase-side closing costs, see our guide to notary fees and registration tax on a purchase; I am deliberately not copying those percentages here.

The primary-home exemption and why wiring the money abroad usually fails it

There is a real exemption, but it is narrower than people hope. The first 5,000 UVT of gain on a natural person's house or apartment of habitation can be exempt only if the entire proceeds are deposited in an AFC account and used to buy another house or apartment, or are paid directly to one or more mortgages linked to the home sold.

The 2026 UVT is COP 52,374 (DIAN Resolución 000238 of 15 December 2025). Five thousand times that is COP 261,870,000 of gain. It is not a standard deduction for every foreign seller, and it only covers a first slice of the gain. If your plan is to take the cash abroad, that condition is not met, so do not build your numbers around this exemption.

Which return you file

A tax resident files Form 210. A non-resident who is required to file uses Form 110. Withholding at the notary does not by itself answer whether a return is required, so do not treat the notary receipt as the end of your obligations. Electronic filing is required, and I will not give a 2026 deadline here because the figure in the sources is for the previous taxable year; check the current calendar on the DIAN site.

For how residents file in general, see our Form 210 guide. It does not cover the sale calculation, so use it for the mechanics only.

Moving the money out

Proceeds from selling a registered foreign investment generally have to be channeled through the foreign-exchange market and reported to Banco de la República. That is the general principle; the exact form and the bank's requirements are something to confirm before closing, not after. I would not assume the buyer pays in dollars or that a particular bank fee applies. Our Form 4 foreign investment guide explains the registration side.

What to ask the notary for before you sign

The real withholding schedule for real estate has been unstable. Decree 572 of 2025 rewrote the brackets, and on 8 May 2026 DIAN announced that articles 2 to 8 of that decree were provisionally suspended until the court stay ends, telling withholding agents to apply the earlier schedule. I cannot confirm what applies on your closing date, so do not rely on a bracket you read online.

For non-residents, withholding under article 415 is a percentage of the gross payment, and the occasional-gain case uses a different tariff from ordinary income. Treat any single figure you see quoted as unverified for your case.

Ask for a written liquidación that states:

1. Your residence status as the notary understood it.
2. The article used for the withholding.
3. The base the withholding was calculated on.
4. The peso amount to be paid.

Then take it to a tax preparer before signing. A real estate lawyer can also check the deed wording, including the sworn price statement.

This is general information from public rules as accessed on 2026-10-07. It is not a personal DIAN opinion or a closing opinion.

Frequently Asked Questions

❓ Is the 1% paid at the notary my capital-gains tax?

No. For a natural person, the 1% can be article 398 withholding on the sale price, a prepayment. The occasional-gain tax is 15% of the gain when that regime applies. The two are calculated on different bases. (verify with the official source, as accessed)

❓ Am I automatically a non-resident seller because I am a foreigner?

No. DIAN uses tax residence, not nationality or visa type. A non-resident natural person selling Colombian real estate falls under articles 406 and 415 rather than article 398. Confirm your residence status before the closing. (verify with the official source, as accessed)

❓ What if I have owned the property for less than two years?

The profit is ordinary income, not an occasional gain, so the 15% occasional-gain rate does not apply. The ordinary rate depends on how your return is computed, so a tax preparer should run the numbers for your situation. (verify with the official source, as accessed)

❓ Can I use the cadastral appraisal as my cost?

No. Cadastral value can raise the minimum price DIAN accepts, but it is not your cost basis. Your cost is the fiscal cost, and payments made outside the deed count toward the price. Keep receipts and the original deed. (verify with the official source, as accessed)

❓ Can I exclude about COP 261,870,000 and still wire the sale abroad?

Generally not. That figure is 5,000 UVT at the 2026 UVT of COP 52,374, and it only exempts the first slice of gain on a home. It requires the full proceeds to go to an AFC repurchase or a linked mortgage, which sending the money abroad does not satisfy. (verify with the official source, as accessed)

❓ Do I file Form 210?

Only if you are a tax resident. A resident files Form 210, and a non-resident who is required to file uses Form 110. Withholding at closing does not by itself tell you whether a return is required, so check your case. (verify with the official source, as accessed)

❓ Will the notary use 1% on the first 10,000 or 20,000 UVT?

Do not rely on either bracket. Decree 572 of 2025 changed the schedule, and DIAN's 8 May 2026 release suspended that change until the court stay ends. Ask for a written liquidación for your closing date. (verify with the official source, as accessed)