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Colombia: Tax Responsibilities as Retiree in Columbia?:
I knew I said I’d hold my tongue - but given Jason’s last post - I at least have the right of reply.
Firstly to the OP, I’m the Bulldog by the way. @Jason is hardly the best resource for you to use for advice. Jason avoids paying tax here (and not legally) and he’s upset with me because I pointed out the fact to him yesterday. @LIMs information is sort of true, but he hasn’t expanded the important bit about what type of foreign taxes are deductible. It’s a far more limited than he’s suggesting. The Deloitte piece is nothing more than an overview of the tax system - it’s intended as a teaser to get you use their services - and will give you an idea but not much more. As Jason so wisely says - speak to a tax advisor. OP you need to read no further.
@LIM again pushing the idea that taxes are no issue. I did appreciate last night when I suggested that you were connected through your website to the ‘Medellin Dream’ Real Estate Business that you had a little prod at Rich from FARM (or is it FARI now). Well done. I’ve noted that you’ve poked young Rich more than once but you’ve never once criticized Casacol the other Gringo Agency that has links to your website. Is Casacol that different?
Now Jason. Jason who arrived and was the young guy coming down for the chicas! Who filled this forum up with his nightly experiences with the young ladies of Medellin to much clapping from the forum. Go Jason boy!
More than a few of us wondered why the site had been turned into a sex tourist forum and when those comments started coming Jason had a remodel. Jason then became the person who was ‘cool’, the one who would be standing with his ‘Colombian friends at the bar’. Come over, and I’ll let you in to this cool world was Jason’s siren song.
That went on for a bit and then Jason got a girlfriend and so we entered the ‘Great Lover’ phase where we got to hear charming stories about what she was cooking for him or how desperate she was for his lovely Gringo body that she would pay half of the hotel bill. So cute, so dedicated.
There was always going to be limited mileage in that for Jason and the board probably preferred the ‘bed hopping phase’ as it had more entertainment value. Now we’ve got Jason the great champion of the forum sweeping out the bad influences so that it’s a friendly place - and more importantly that anyone understands that if you don’t agree with him then he’s going to write unpleasant pieces so that people can laugh at you and his humor.
Jason is a writer. And that’s what he's doing on this forum. Changing styles, changing approach, raising emotions seeing what gets the most applause. The only question is what he becomes next.
But let’s look at the real Jason. He’s a writer and he’s told us that he had a really boring Government job at one point. I think he probably mentioned that it was the TSA. I kind of doubt that Jason just fell into working at the TSA (that makes the better story) but rather that he saw that there was a book - or at least a living writing articles about it. So he worked there a while and then the articles started coming.
As I’ve told Jason the writing isn’t bad - and in some ways it’s laudable that someone is exposing issues in a Government Agency like that. After all, most people at some point have some issue with the TSA.
As Jason himself writes posting these articles while he was at the TSA resulted in a little attention. Some of the articles provide interesting insights into the agency. Some stories kind of read like they are composed of pieces of things that might have happened and then changed into a charming story. But then it started getting a darker and I’m sure that some people in the TSA went and looked for pieces of paper that Jason had signed when he went to work for the agency using words like ‘confidentiality’ and ‘secret’. My guess is that most TSA agents know the weaknesses of the body scanning systems but Jason, for a buck, thought that it would be useful to reveal the information to a wider world. After all what’s the harm in an identified TSA operative telling the world where to put the ‘bad stuff’ to avoid detection in a body scanner.
Not that Jason’s stuff was hidden away. Some pretty big news organizations took the pieces and by this point I’d think that the authorities might have been suggesting to Jason to ‘cease and desist’.
But then he got a book advance - and seeing as just about anything he’s ever written that has ever been read is this TSA stuff - it could well be on the same subject; who knows. And perhaps Jason thought that being away from the US might be good idea if further beans were going to be spilled.
But then who knows why he’s here. He has a book advance. There’s a lot of interest in Medellin and Colombia following the Netflix’ Narcos series. That could make a book couldn’t it? There would be enough sleaze, enough grist get some interest. Perhaps in a few years time I might see the book sitting in a large pile on the remainders section and flick through and find a chapter about a character called ‘the Bulldog’ who will no doubt roam the streets at night doing foul things.
So have fun with him. Just remember Jason isn’t big on morals if there’s a $ involved.
As Jason will be thrilled to know (and others) I’m out of here.
Colombia: Taxes:
Only on any Colombian income or assets that you have. So if you invest in a property, live in it for 183 days and then rent it out you'll be paying Colombian taxes on that income. Bit if you come and rent - don't earn any money - no.
Colombia: Once again taxes.:
But as I've just commented on another thread providing you don't have any Colombian income.
Buy an investment property, live in 183 days and then rent it out and you're still a Colombian tax payer on that income.
Colombia: Colobia TAX REFORM:
@ccm last night I was sitting under the stars, sipping a Scotch and listening to music when I read your post and your challenge for me to respond to the OP. I read and thought better of answering it at that moment.
I've reread the posting again this morning and I'm not sure that I agree with your reading. What still exists is the method of taxation based on assets - if it exceeds the method by income and there's no way that is going to go away. The 'war' tax should be on the way out - but this article is I think about tax evasion. Let me give my take on it.
Firstly the Colombians have a pretty good handle on getting people to pay tax on income. Some receive cash in hand of course but for the majority of people who pay tax it's deducted at source from their income. As in many other places self-employed people, or people who own businesses may have the ability to underreport, but that's not what this article is about.
What has surprised people is that the taxes aren't being increased more. One of the reasons for that is that the government - rather than adding to the tax burden of those who already report correctly - is that they are going to go after people who aren't paying taxes - by not declaring assets. In the article the point is made that the penalties for lying to the tax authorities here aren't severe enough, and so believing that it'll be easy to get people to declare their full wealth is unlikely. Tax evasion isn't illegal here - so there's no thought of going to prison for lying on your taxes. The fines though, if caught, can be eye watering.
There clearly is quite a lot of tax evasion. It's getting less easy to hide assets in Colombia (property tax bills - all that sort of thing are being more connected to the tax system) so it's principally about money abroad.
Take last year for example there was a lot of noise about money in Panama and how it was there to evade tax. Many people had money there because it had been marketed by the banks as a) tax free on earnings b) the ability to hold investments in $s and invest in $ instruments and c) money outside the country just in case everything went the way of Venezuela. However the authorities decided that Panama was no longer going to be a tax haven for Colombians and working with the Panamanians got information on Colombians who had money there. A deal was offered - pay a penal one off tax to declare the assets on your tax forms (it was around 15% of the notional) last year or pay increasingly unpleasant amounts if you waited until the future to declare it. I can't remember the exact schedule but it's something like in 3 years time the tax will be 200% of the notional. Some paid up - and if they had large amounts in Panama had to sell assets (and the $s) to pay the tax bill in Pesos.
I was talking to a financial advisor about this and he said that although some of his clients had disclosed the assets - the majority hadn't - effectively giving the finger to the Colombian authorities. One reason no doubt from the account holders was to see if they could find out another ruse to put the money beyond Colombia's reach - but also probably questioning if the Colombian authorities had all of the information they said they had. So, one of the main places to hide assets - in theory at least - has been taken away.
Another place where there are hidden assets is no doubt the US. How many Florida homes owned by Colombians might not be included on tax returns? Plenty of upper middle class Colombians have US bank accounts and they of course may not have been declared. Now of course the US and the Colombians are meant to be sharing more information. Whether those properties and bank accounts are any more visible to the authorities here is a question, but the scale of the problem isn't insignificant. The authorities also know that while some of the offshore money is clean, there's more than a chance that much of it isn't and hence their ongoing interest in finding it.
Whether the DIAN has the resources to really deep dive into what everyone has we will need to see. Personally I think they've got enough Panamanian data to make life difficult for people and get revenue there. From the US; probably more difficult but perhaps not impossible.
What's the impact for ex-pats? Well not disclosing world wide assets becomes more risky. You also might find that your tax preparer is a little more insistent that you include everything if they know that the DIAN is focusing on the issue as they probably want to avoid the grief and time that an audit might entail.
The problem, whether for Colombians or ex-pats in not disclosing assets (in the belief that they are not traceable) remains that it is then difficult to use the assets. For example a Colombian can't sell the US house and try to bring the $s back here. If nothing else it's a potentially huge tax event plus of course explaining the source of the funds. Same with an ex-pat and some sort of retirement account that hasn't been declared and then produces an 'income' distribution.
I don't think that Colombia's dropped the requirement to list all assets - rather that they know that many wealthy people suffer amnesia when declaring wealth.
Colombia: What's it like being an Expat in Medellin?:
Firsty congratulations @Jason on being here for 7 months. It seems only a short time ago that you 'were just passing through' when we talked about the requirements of paying taxes in Colombia. Now you've passed the magic 183 days you now get to share your book advances with the Colombian Government.
Now, am I insulting @Jason? Actually not, I'm making a point about people asking about becoming an expat. What type of expat you intend to be asks different questions and gives you different problems. A month ago tax wasn't an issue for Jason. Now it potentially is.
Firstly let's be clear than I don't think anyone has come to Colombia and left because a) the Peso was too strong b) the countryside wasn't lovely or c) that the girls weren't pretty enough. Ex Pats give up because of other issues.
Lets look at some of the groups of people who call themselves expats
a) retired people who move here full time and live off income from overseas. Clearly 'ex-pats'
b) people who are moved here to work for their company generally for a set period say 3-5 years. Ex-pats again I think but not many of them
c) people who come here to find work or set up their own business. Not many of them I'd argue. If nothing else working in Colombia isn't a great way to make a lot of money
d) the 183 day people who live here just long enough not to pay taxes and return each year. I guess they are ex-pats, 'migratory' ex-pats perhaps. However they generally reside using 'tourist' entry stamps.
e) people who spend other portions of time down here, maybe a couple of weeks several times a year. Personally I think they are tourists, but they may disagree.
f) people like Jason, passing through on some sort of on an delayed gap year. There may be no fixed plan, but they'll be here on a tourist stamp or do a little studying to justify being a student visa. Ex-pat? Maybe.
What is different is that people in d., e. and f. don't have any real ties, and certainly not financial ties to Colombia. If @Jason gets bored with Colombia he can move on the next day. If the political situation in Colombia worsens or the visa situation changes the 183 day people don't have to come back. As people have pointed out - there are other countries who will take my money.
The people in a, b and c have issues that the other groups don't have. Taxation is pretty obvious. They may need Bank accounts, driving licenses, health care. Perhaps they've invested in property here. For those people the women are no less lovely, the countryside no less pretty and the exchange rate no less of a benefit but it's other things that determine whether or not they enjoy being in Colombia. But they're are to some extent committed here. Reversing the decision is much more difficult and potentially financially painful.
So, what type of expat is the OP? From the age the OP seems to be too young to retire - but perhaps not? Has a gf down here and thinking about working? If that's the case forget advice on the pretty countryside and start wondering about pay and work visas because that's the priority. Can you support yourself down here?
For me anyone thinking of becoming an expat down here - that's someone who is relocating here and making this their home - unless they are retiring or they've a really good reason to come here (say a gf or spouse) I think there are an awful lot of negatives. It's a lovely country - but it's tough to make a decent living here.
One other thought on expat advice. Often the advice is on what's here - the good stuff - rather than what often gets to ex-pats; missing home. Take even something simple like coming home in the evening and switching on the TV and flicking through until you find something you want to watch. Colombian TV (and here will come our KODI rep) is pretty awful. Get Directv and you'll get ESPN. In Spanish and not probably what you are used to. People miss stuff which is why just about any review you'll read by an expat on eating out here usually makes some comparison to how it is back home. We all get a little homesick - even stupid stuff. My example. I like a UK Sauce called HP. It's a brown sauce and while you can often find it overseas I've never found it here. So I have to go for a substitute which is the American A-1 sauce. Not the same, but sort of. Except A-1 is difficult to find here (if anyone is looking for it generally Jumbo has it ). It's a small thing, but all of those things add up. I can't remember ever seeing a foreign newspaper in Medellin for example.
So if we were to apply a rating to how much Colombia was like to the US my score wouldn't be very high. Maybe 4/10 in the big cities. Some people like the difference, some people seek the difference; but equally some are surprised by the difference.
Colombia: International Baccelaureate Schools in Colombia:
I'll see if I can find out more - my wife probably knows. One thing - and I think you are moving soon - is that getting into the better private schools isn't easy and many have long waiting lists. On the positive side several of them are on the airport side of the city so getting to them is somewhat easier.
Two you might try are Colombus and Marymount. If you do find that you can get them in take a deep breath before they talk about fees...
Colombia: Med Airport at midnight?:
The helicopter service lasted no time at all - which probably wasn't of much surprise to anyone. Ridership was meant to be terrible.
One of the reasons it could only be a day service when it ran was that the downtown airport isn't open at night.
Colombia: Moving to Pereira:
One thing you don't state your age. That has some impact as a lot of professional jobs are filled by new graduates or conversely people moving from another job in the same field. So, for example if you're in your late twenties you'll be competing with people a few years younger.
For anything in Government you need local contacts rather than expats.
My experience is that Colombians in professional jobs job hop far less than people in the US. They often stay where they are - even if it isn't great - because the have concerns about finding something else. The salary you've suggested might be possible (not sure about Government jobs) but you'll be surprised at how low some jobs pay here.
Good openings here mimic what you see in the US. There's a great demand for technology people for example. If I was you I'd look at one of the growing industries in Colombia like tourism. The pay might be an issue to start with but if you've fluent english and spanish that's going to be a big plus.
On setting up your own business my thought is that's a solution for people who've had experience setting up businesses before (and that doesn't have to be in Colombia). Learning to build a business in Colombia has got to be at least challenging.
One business that can pay well (although you'll need to make contacts) is the Real Estate business. Having recently been surrounded by real estate agents I don't think it's something that could be picked up fairly quickly - and as people say there aren't many english speaking realtors here. At 3% commission a sale on a nice COP 800 million apartment would get you around COP 24 million or roughly what you're looking to make in a year. Perhaps you might find some agency in would be interested in taking you on to learn the business?
Colombia: LIVING THE DREAM:
I agree that @jb advice is excellent but was thinking about another aspect of the posting. It's rather the third rail of subjects here on the forum - it's about older ex-pats and younger Colombian females but let's see if I can get out of here alive.
Firstly for the OP moving to Colombia is a big risk. I don't know the statistics but many think about it, come and do their recce and decide against it. The come, it's more different than they expect or they get scared away but valid issues like taxes.
Others come and plenty make it. But there are more than a few who really find that this wasn't a great move. Some post of their frustration on here others leave quietly, wiser and perhaps poorer.
Now I'm no betting man but I'd suggest that your odds - without ties to the country or knowledge of it are probably 50/50 at this point that you'd like being in Colombia. That doesn't mean that you can't make it work - but don't get too committed until you've done more research and had boots on the ground living here.
Now on the age gap. You're 58 and you are suggesting you'd like to meet a single mother. I think we all understand the attraction, older guy helps some struggling young women and transforms her and her child's lives for which she is eternally grateful. Without being rude it's sort of the poor mans 'trophy wife'. Every one of your friends will be green with envy of your beautiful new friend. I also think she will be grateful - its the eternally I'm more cautious on.
Let's try and put some scenarios together. It's not unusual for women to become single mother's at 18, so one with a baby/young child would be in her late teens, early twenties. Or equally she could be in her mid thirties with a teenager.
Let's take something in the middle. Let's say a twenty-five year old with a seven year old child.
You're now 58, so there's 33 years difference between you. When you are 68 she'll be 35; when you're 80 she'll be 45. And that's a big difference. Now, at the moment there may be a fantasy about having this young girl dress in a nurses uniform. But in reality, in a few years time that's what she may well be - an unpaid nurse looking after you.
Now there are plenty here who have made the old/young thing work - and by disclosure my wife is quite a bit younger than me - but 30 odd years is a lot. Now, knowing this board someone is going to pop up and point out that they are 83 and their 21 year old Colombian lingerie model gf can't keep up with them sexually, but it's the exception I promise you.
And the age difference throws up all sorts of other issues. How much do you have in common with someone in their mid-twenties even before allowing for the culture differences. How about the friends she has of her own age? How will they see you? The fact that her father may be younger than you - and people here have kids so young her grandfather might even call you 'Dad'. And let's not even go with the concept of how the natural father and you are going to get on if he's still about.
So come to Colombia, look for love if that's a goal but my suggestion would be not to come and look for a concept like a 'single mother'. You may find one, it may work, but in reality the odds are stacked against you for a whole set of reasons.
Colombia: US begins restrictions on Colombian visas:
I suggested this in an earlier thread and that the most likely people at risk are the 'temporary expats' who anticipate getting stamped in for 90 days and then being able to extend to 180 days. The Colombians are unlikely - as they'll want to preserve the tourist trade - to react too severely and will want to avoid tourists having to get visas as that tends to discourage travel. However a shorter 30 day stamp in would have little impact on tourism - beyond backpackers - or extending some entry fee as payment for a 'visa' on arrival might be likely reactions. They might also tighten up on people who are traveling for business but use the tourist stamp rather than applying for a more 'commercial' visa.
While the review by the US is now going to be stricter we'll need to see what the real impact is. Many Colombians who travel to the US (and it tends to be repeat travelers) have 10 year visitors visas so the immediate impact will be muted.
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