Estonian Company Run from Colombia: Tax Rules

Many people living in Colombia form or buy an Estonian private limited company (OÜ), often as e-residents, and run it from Colombia. The Colombian Tax Statute treats a company as Colombian ("national") when its effective place of management is in Colombia during the tax year, and a national company is taxed on its income from everywhere. On the owner side, its controlled foreign entity rules put the passive income of a company controlled from Colombia in the hands of its Colombian owners every year. And there is no tax treaty between Estonia and Colombia. This guide sets out these rules with the official texts, and what we do on the Estonian side.

The guide is general information, not tax advice. How your company and you are taxed depends on the facts of your case; ask a Colombian tax adviser before you form or buy the company. We read the Estatuto Tributario in the official compilation of the Secretary General of the Colombian Senate on secretariasenado.gov.co (last updated 15 October 2026), on 22 October 2026. The Statute is in Spanish; the English wording here is ours.

In Estonia: an Estonian company is Estonian

A company established under Estonian law is resident in Estonia for tax purposes (Income Tax Act § 6). Its profit is taxed when it is distributed, not while it stays in the company — the guide how Estonia taxes company profit explains the rule. The company keeps its Estonian duties wherever its owners live: accounts, an annual report to the commercial register and, if its address is abroad, a contact person in Estonia.

In Colombia: the company side

Effective place of management. Companies and entities that have their effective place of management in Colombian territory during the tax year are national for tax purposes (Estatuto Tributario, article 12-1). The effective place of management is where the commercial and management decisions needed to carry on the company's day-to-day activities are actually taken, looking especially at where its managers usually exercise their responsibilities and where its daily activities are carried out (article 12-1, paragraph 1).
Not by itself. A company is not national merely because its board meets in Colombia or because Colombian residents are among its shareholders (article 12-1, paragraph 2).
Income from everywhere. National companies are taxed on income from Colombian and from foreign sources; foreign companies only on Colombian-source income (article 12).
The rate. The general income tax rate for national companies, permanent establishments of foreign entities and foreign legal persons is 35 percent (article 240).

An Estonian OÜ is not formed in Colombia. If its day-to-day decisions are taken by you in Colombia, whether its effective place of management is there is the question article 12-1 raises. Your Colombian tax adviser answers it with the facts of your case.

In Colombia: the owner side

Resident. A natural person is resident who stays in Colombia, continuously or not, for more than 183 calendar days — days of entry and departure included — within any period of 365 consecutive calendar days (article 10).
Controlled foreign entity. A foreign entity without tax residence in Colombia that is controlled by one or more Colombian tax residents is a controlled foreign entity (article 882); every Colombian resident holding directly or indirectly 10 percent or more of its capital or results is subject to the rules (article 883).
Passive income taxed every year. The entity's passive income — such as dividends, interest and income from the use of intangible assets, as listed in article 884 — is treated as realised by its Colombian owners in the year the entity earns it, in proportion to their holding (article 886). When passive income is 80 percent or more of its total income, all its income is treated as passive; when active income is 80 percent or more, all of it is treated as active (article 885).

An Estonian OÜ pays no corporate income tax while its profit stays in the company. Whether your company is a controlled foreign entity, and how much of its income is passive, is a question for your Colombian tax adviser.

No tax treaty between Estonia and Colombia

Colombia is not on the list of Estonia's tax treaties published by the Estonian Ministry of Finance. So no treaty decides which country a company resident in both is resident of, and no treaty limits the tax either country charges on dividends or board fees. Each country applies its own law; whether and how double taxation is relieved then depends on each country's domestic rules — a question for your Colombian tax adviser. We do not give that ruling.

What to decide before you form or buy the company

Where the company is managed. Day-to-day commercial and management decisions in Colombia bring in article 12-1.
Where you live. More than 183 days in Colombia within 365 days makes you resident under article 10.
What the company earns. Passive income and your holding decide what the controlled foreign entity rules attribute to you.

What we do on the Estonian side

online formation for an e-resident — €950 Registered address and contact person service for one year are included., or formation by power of attorney — €1,250;
a ready-made company bought remotely — €1,200 Registered address and contact person service for one year are included.;
accounting — from €150 / month and the annual report — from €450;
the registered address and contact person after the first 12 months — €350 / year.

Our accounting covers the Estonian company's Estonian obligations. Colombian tax returns and Colombian tax advice are not included. Owners in other countries: Estonian company run from abroad compares the rules side by side.

The two company forms side by side — founding document, capital, share transfer and the company tax: Estonian OÜ or Colombian S.A.S..

Prices exclude VAT. All communication takes place by email.

Ready to start? A new Estonian company — online for e-residents or by power of attorney; Colombian tax advice is not included. Order.

Official sources

The laws this article names, by the name of their official text, as read on 9 October 2026. For the Estonian acts we read the English translation in Riigi Teataja; the legally binding text is the Estonian one.

Income Tax Act — Riigi Teataja, English translation

Sources are named in the text, without links. To see which of our services your company needs, open the Business Navigator.

Frequently asked questions

Is my Estonian company taxed in Colombia if I run it from Colombia?

It can be. Colombia treats a company as national when its effective place of management — where the day-to-day commercial and management decisions are actually taken — is in Colombia during the tax year (Estatuto Tributario, article 12-1), and a national company is taxed on income from everywhere at 35 percent (articles 12 and 240). In Estonia the company stays resident because it was established under Estonian law (Income Tax Act § 6). There is no tax treaty between Estonia and Colombia, so no treaty decides a company resident in both. A Colombian resident who controls the company can also be taxed every year on its passive income under the controlled foreign entity rules (articles 882 to 886). Ask a Colombian tax adviser before you form or buy the company; we handle the Estonian side.

Estonian company run from Colombia: what is taxed where