DIAN: Tax Procedures Undertaken During the Health Emergency 

The DIAN issued Internal Circular No. 13 of April 18, 2020, establishing guidelines on the administrative processes to be carried out by the entity during the health crisis caused by COVID-19. The following are the most important items dealt by the document:

  • Tax measures in insolvency proceedings

The document points out that companies admitted to a business reorganization process or which have concluded a reorganization agreement and are in the process of implementing it will not be subject to income tax withholdings or self-holdings.

Likewise, such companies will be exempt from liquidating and paying the advance payment of income as established in Article 807 of the Tax Code for the fiscal year 2020.

On the other hand, they will be subject to 50% VAT withholdings. Such withholdings shall be made by all withholding agents who acquire the goods or services from these companies.

Finally, the companies will not have to settle presumptive income for the year 2020.

  • RUT and electronic signature management

The Circular indicates that the RUT application and electronic signature processes that are carried out in person will operate by scheduling virtual appointments.

Once the appointments are scheduled, the taxpayers receive an e-mail confirming their appointment to the e-mail informed in the scheduling system, whereupon they are sent the following link with the indications to file the application and the terms and conditions of the procedure: HTTPS://WWW.DIAN.GOV.CO/PAGINAS/INFORMACION-INSCRIPCION-VIRTUAL-RUT.ASPX Subsequently, taxpayers must send scanned supporting documents and the draft Form 001 of the RUT to the mail indicated in the Circular and assigned with the appointment confirmation. The documents must be sent before 9 AM on the day of service by the officer.

The results of the procedure must be sent to the taxpayer's mail no later than 5 p.m. of the day for which the appointment was scheduled. In case of receiving applications without the full requirements, taxpayers must be informed of the situation so that they can reschedule, fully complying with the terms, conditions and requirements indicated in the appointment confirmation.

Notwithstanding, taxpayers who have an obligation that has expired and require to carry out previous procedures for which there is no available agenda, may contact the national hotline 57 (1) 3556922 or the DIAN chat to validate whether it is possible to self-manage their request or generate an alternative protocol.

RUT and electronic signature requests that are subject to verification are covered by the general suspension of terms established by Resolution 30 of 2020 issued by the DIAN. However, when operating the suspension of terms, notifications must be made from the working day following the end of the health emergency as established by the Tax Code.

In any case, the processes of updating the RUT ordered by the DIAN or by another authority, will follow its standard procedure.

  • Rights of petition

The Circular reminds that the time to resolve taxpayers' rights of petition is 30 days from receipt. The resolution of the following petitions will be subject to a special term:

(i) Requests for documents and information, which are resolved within 20 days of receipt. (ii) Requests for consultation with the authorities in relation to matters under their responsibility, which must be resolved within 35 days of receipt.

  • Discharges and lifting of precautionary measures

The Circular Letter reminds that when the payment or agreement to pay the obligations is accredited, the corresponding precautionary measure must be lifted, and the communications must be issued for its implementation. To this end, the guidelines of Resolution 30 of 2020 shall be followed.

  • Summary refunds of balances in favor

Requests for reimbursement and/or compensation that meet the formal requirements and which, in accordance with the risk profile, are rated very high, must have the terms of the reimbursement and/or compensation of the credit balance suspended during the term of the health emergency, since they represent an alleged risk of tax fraud and/or specific risk.

On the other hand, requests for reimbursement and/or compensation that comply with the formal requirements and that in accordance with the risk profile have a high rating, must be studied in order to determine within 15 days following the reimbursement request, if the corresponding procedure is undertaken or the terms are suspended until the health emergency is raised.

In addition to the criteria adopted by each of the DIAN sections, the following criteria shall be considered to consider a taxpayer as high risk:

(i) Income tax applications with balance carried forward for more than three periods that have been previously inadmissible without correction and that are under the abbreviated refund process. (ii) Applications for VAT with carry-overs of more than 12 periods filed under the short refund process. (iii) Income tax refund applications, in which it is evidenced that the self-withholdings for the period requested, which originate the balance in favor, are ineffective. (iv) Taxpayers who, during the process of investigation prior to the refund, have corrected the returns subject to refund due to any inconsistency. (v) Taxpayers who, with respect to the same tax subject to refund, for the immediately preceding fiscal year have had the procedure suspended in accordance with the provisions of Article 857-1 of the Tax Code. (vi) Taxpayers who request a refund and/or compensation of the balance in favor of income tax and complementary taxes that they include in their deductions, expenditures to low tax countries or tax havens.

In the case of requests for refund and/or compensation that have a low or medium risk rating, only the review of the formal requirements set forth in the Tax Code and Decree 1625 of 2016 shall be carried out. Consequently, the aspects verified by the officers, which do not refer to "formal requirements" of the refund requests, shall be lifted in accordance with the abbreviated refund process of Decree 535 of 2020.

Now, in the case of requests that result in immediate rejection by the DIAN, the term to resolve them will be that indicated in Article 855 of the Tax Code, that is, 50 days from the request.

Notwithstanding the foregoing, if the terms of the abbreviated refunds are suspended, the DIAN shall notify the taxpayers, for whom the processes shall continue after the health emergency is lifted.

As a final comment, the Circular establishes that requests for refund and/or compensation that have been processed prior to the health emergency and that are being studied by the respective refund units of the DIAN, shall be governed by the criteria mentioned for requests that are processed under the abbreviated process.

However, in relation to requests for refund and/or compensation that are "selected for audit" or have a high rating, in which it is not possible to identify a risk of tax fraud and/or specific risk, the refund and/or compensation of the balance in favor must be authorized, informing the Oversight Management Division so that it may begin the post-refund evaluation once the health emergency is over.



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