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On What Date Should the Two Years Be Counted to Reduce a Penalty for Late Filing?
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On What Date Should the Two Years Be Counted to Reduce a Penalty for Late Filing?

Article 640 of the Tax Statute allows for a penalty reduction when, within the two years prior to the commission of the conduct, the taxpayer has not incurred the same infraction.

However, when determining how the two prior years mentioned in the rule should be counted, the following questions arise:

  • a) Are they counted from the day the late return was filed?
  • b) From the deadline for filing?
  • c) Or are they reviewed by taxable year?

On this matter, the DIAN, through Ruling No. 691 of May 2026, stated that in cases of late filing, the conduct occurs when the legal deadline expires and the return has not been filed.

Therefore, the two years must be counted backward from the day following the deadline; they are not counted from the date of the late filing, nor by taxable year.

The entity provides the following example in the ruling mentioned:

If a VAT return for period 1 of 2024 was due on May 15, 2024, and was filed on June 20, 2024:

  • ü The conduct occurred on May 16, 2024.
  • ü The two-year term for evaluating the reduction is counted backward from May 16, 2024 (back to May 16, 2022).
  • ü If between May 16, 2022 and May 15, 2024 the taxpayer had no other instances of late filing of the same nature, the reduction under Article 640 may apply.

In conclusion, when applying the penalty reduction referred to in numeral 1 of Article 640, the following should be kept in mind:

  • a) The two-year term is counted retroactively from the date the infraction occurred, that is, from the deadline for filing without the return having been filed on time.
  • b) It is not counted from the date the late return is filed.
  • c) It is not determined by taxable year, but by the moment the conduct occurred.

Prepared by: Diego Sanabria Parra – Founding Partner.

THIS DOCUMENT REFLECTS AN OPINION OF OUR FIRM. TAX AUTHORITIES MAY NOT AGREE WITH OUR POSITION. IF YOU WISH TO LEARN MORE ABOUT THIS TOPIC OR REQUIRE SPECIALIZED ADVICE, PLEASE DO NOT HESITATE TO CONTACT US, WE ARE HERE TO SERVE YOU.