On 19 October 2026, DIAN released Concept 016547 dated 21 September 2026, addressing the determination of taxable income under the equity comparison method. The ruling states that only income tax and complementary taxes effectively paid during the taxable year under comparison may be deducted from the equity variation. Accrued but unpaid tax liabilities do not qualify for deduction. This interpretation reinforces the cash-basis principle for this specific computation, diverging from the accrual basis used in general financial reporting.
Key Takeaways
- Cash-Basis Requirement: Taxpayers must ensure tax payments are completed before year-end to benefit from the deduction in the equity comparison calculation.
- Planning Impact: Entities with installment payment plans or deferred tax liabilities must accelerate payments to optimize their taxable base.
- Documentation: Proof of payment (bank receipts, DIAN confirmation) must be retained to substantiate the deduction during audits.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement