TAX BENEFITS FOR THE INVESTMENT ON CLEAN AND RENEWABLE ENERGY SOURCES
Income Tax
Colombian Tax Authority clarified the procedures and conditions that investors and companies must comply with in order to access to tax benefits for the investment in clean energy sources
In order to encourage the use of unconventional energy sources, since 2014 the National Government and the Congress have created tax benefits that can be applied by companies and individuals who decide to invest in projects for the generation of clean energy.
For the application of the tax benefits, the Tax Administration clarified, by means of Revenue Ruling No. 0843 de 20018, the requirements the investor has to meet.
1. For the deduction of 50% of the investment on non-conventional sources of energy, the taxpayer must:
- Submit the environmental benefit certification issued by the Ministry of Environment.
- Prove that the investment does not proceed from an order of an environmental authority to mitigate the environmental impact caused by the tax payer.
2. In order that the equipment, elements and machinery, national or imported, or the acquisition of services is VAT exempted, the following requirements must be met:
- The equipment, elements, machinery or services has to be classified by the Energy Mining and Planning Unit.
- International quality standard and technical criteria must be taken into account in order to justify the relation of the goods and services with the non-conventional energy project.
- Certification of the National Authority of Environmental Licenses including the amounts and tariffs of the good destined to the non-conventional energy project.
