Colombia Clarifies Tax Treatment of Default Interest Under Tax Treaty with South Korea

Colombia's National Tax Authority (DIAN) recently issued a ruling concerning the treatment of default (penalty) interest payable by a Colombian entity to a Korean entity under the 2010 Colombia-South Korea tax treaty. The ruling clarifies that default (penalty) interest is not considered "interest" for the purpose of Article 11 (Interest) of the treaty, and therefore the withholding tax provisi…
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