The Colombian regulation is not very forgiving in terms of exchanging and trading cryptocurrencies. But, you may pay with it for a lot of services.
Since the 6th of May there was an agreement in Colombia which makes it possible to buy and sell Bitcoin, Ether, Litecoin and Bitcoin Cash with Colombian pesos, although there wasn’t a specific launching date for the service.
Getting cryptocurrency in use in the country may take a while and trading it to the local currency will need a third party action and may be expensive. 6.1% of Colombians own cryptocurrency.
Colombia’s restrictive legal environment towards virtual currencies suggests it is challenging to operate a cryptocurrency business within the country. The Financial Superintendence of Colombia (SFC) has virtually prohibited banks from providing financial services to cryptocurrency companies. Consequently, cryptocurrency firms in Colombia may not utilize banking institutions. Furthermore, Colombian officials declared in 2014 that regulated financial institutions shall not possess or invest in cryptocurrencies. Consequently, cryptocurrency-related companies may not seek investments from regulated financial institutions. Accordingly, cryptocurrency-oriented businesses in Colombia must operate without the assistance of banking and financial institutions.
Taxes and Regulation
In Colombia, you’d have to declare about any money that enters the country, no matter if it’s via Cryptocurrency, Cash or bank transfer.
You wouldn’t have to pay IVA (VAT) for buying Cryptocurrency, but, you’d have to issue an invoice or equivalent document once you sell or buy cryptocurrency. You may use screenshots of your digital wallet as a receipt or a declaration of any transaction using cryptocurrencies.
As for the fourth of February 2021, taxation is yet to be decided, although, for now, it is the same as it is for financial assets (shares and etc.).