The Colombian tax authority's new position on cloud computing services may be good news for some taxpayers, because cloud computing services that qualify as general services would not be subject to tax in Colombia.

On November 7, 2018, the Colombian tax authority issued Opinion No. 32620, concluding that not all cloud computing services are technical services, and a case-by-case analysis is required to determine whether cloud computing services are technical services.

This new opinion supersedes Opinion No. 065 of February 6, 2018, in which the tax authority determined that cloud computing services are technical services for tax purposes.

According to Opinion No. 32620, if a cloud computing service is automated (i.e., there is no human intervention), the service should be deemed as a general service provided from abroad and not as a technical service. If the cloud computing service requires some human intervention that involves the application of specialized knowledge (not conveyed to the recipient of the services), the service is a technical service.

Technical services are subject to a 15% withholding tax and the service agreement must be registered with the tax authorities to claim the deductibility of the service expense.General services rendered from abroad are not subject to tax in Colombia.

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