Closing costs in Colombia: notary, registration and taxes

The price of the property isn't all that is paid. When property changes hands in Colombia there are notary fees, registration costs and taxes, and each has someone responsible for it. The percentages in this guide are approximate: always ask the notary for the exact figures before you sign.

The costs, one by one

• Notary fees (derechos notariales). What the notary charges for the deed. Around 0.3% of the sale value, plus VAT, copies and other small charges. By custom they are split equally between buyer and seller.
• Withholding tax (retención en la fuente). 1% of the sale value when the seller is an individual. The seller pays it at the notary; it is an advance on their income tax.
• Registration tax (impuesto de registro, also called beneficencia). Charged by the department; around 1% of the value. It is customarily split in half, though many agree the buyer pays it.
• Registration fees (derechos de registro). What the Registry Office charges to record the deed: roughly 0.5% to 1%, depending on the value. The buyer pays them.

How much in total

As a guide, without a loan:

• The buyer usually pays between 1.5% and 2% of the property's value.
• The seller usually pays around 1.5% to 2%, including the withholding, plus the agency's commission if there is one.

Example: on a home worth 400 million pesos, the buyer should set aside 6 to 8 million for the deed and registration.

Who pays what can be agreed differently. Whatever you agree should be written into the promise of sale.

If you buy with a loan

• A valuation of the property, required by the bank.
• The bank's title check.
• The mortgage deed: additional notary and registration fees, calculated on the loan amount.
• Insurance for life, and for fire and earthquake, paid with each instalment.

Other costs for the seller

• Clearances: property tax and betterment levy paid up, and building fees if it is a condominium.
• Cancelling a mortgage, if the property has one: its own deed and registration.
• Capital gains tax (ganancia ocasional). If you sell for more than the property cost you, the gain may be taxed in your income tax return. There are exemptions for homes in certain cases. Ask an accountant.

New homes

For new developments, the builder usually states the deed costs when you reserve. Social-interest housing has reduced notary and registration rates.

Frequently asked questions

What value are they calculated on?

On the sale value stated in the deed, which can't be lower than the cadastral value. Declaring less than the real price is illegal and works against you when you sell.

When are they paid?

Notary fees and withholding on the day of signing. Registration tax and fees before the deed is taken to the registry, in the following days.

What else should I know before buying?

The full process is in How to buy property in Colombia, and the seller's paperwork in Documents you need to sell property.