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6.5.4. Royalties

Royalties are generally deductible. In principle, royalty payments to foreign parent companies are not deductible, unless they are subject to withholding taxes. This restriction does not apply when the taxpayer duly complies with transfer pricing regulations.

On the other hand, Decision 291 of the Andean Community establishes that contracts for technology import (i.e. licenses of patents, brands, know how, etc) must be registered before the competent national authority (in Colombia, the tax authority - DIAN-).  Please bear in mind that Colombian tax authority has considered that said registration is a condition for the deductibility of payments made under contracts for technology import.