Practical guide to incorporate a company in Colombia in 2025 (and keeping it compliant)
Starting a business in Colombia in 2025 is a smart move.
Our country has become an attractive destination for both Colombians and foreigners thanks to its strategic location, growing economy, and international treaties that encourage investment.
Additionally, the rise of the entrepreneurial ecosystem, tax benefits for specific sectors, and an increasingly robust network of legal and accounting support make setting up a company here a viable and profitable option for those looking to enter new markets.
If you’re considering opening a business in Colombia, this guide is for you. We’ll walk you through everything you need to know to set up your company properly and meet the legal obligations to ensure your business starts right—and stays on track.
Understanding these key points from the beginning will save you time, money, and stress.
1. Choose the Right Type of Company for Your Project
Before diving into the paperwork, it’s crucial to define what type of company you want to create.
Colombia offers several legal structures, and choosing the right one will depend on your goals, the size of your project, the number of partners, and your growth outlook.
These are the most common options:
- S.A.S. (Simplified Joint Stock Company): The favorite among entrepreneurs and small businesses, both local and foreign. It’s known for being easy to set up, allowing a single shareholder, and offering flexible administration. No minimum capital is required, and it can be incorporated via a private document, which speeds up the process.
- Ltda. (Limited Liability Company): Less common nowadays, but still a good choice for family businesses or traditional sectors. Requires 2 to 25 partners who are liable only up to the amount of their contributions.
- S.A. (Corporation): Used mainly for large companies with fast-growth projections or those planning to go public. Requires at least 5 shareholders, a minimum capital investment, and has a more complex administrative and accounting structure.
- General and Limited Partnerships: Rarely used, but suitable for specific projects. In general partnerships, all partners have unlimited liability. In limited partnerships, managing partners have unlimited liability, while silent partners are only liable for their investment.
Choosing the right legal form is crucial as it defines your legal responsibilities, internal governance, tax treatment, and your ability to raise capital.
2. Estimated Timeframe to Set Up Your Business
One of the main concerns for new business owners is how long the incorporation process will take.
The good news is that in Colombia, if you choose the right structure and work with a professional, the process can be quick:
- S.A.S.: Usually completed within 5 to 10 business days. This includes registration with the Chamber of Commerce and obtaining the tax ID (NIT) from DIAN.
- Ltda. or S.A.: These structures require a public deed and notary steps, so they may take 3 to 5 weeks.
Working with experienced advisors familiar with Colombian procedures makes a big difference and can help avoid delays.
3. Do I Need a Statutory Auditor?
This is a common question at the startup stage. A statutory auditor is a certified public accountant who ensures financial transparency and compliance with accounting and tax rules.
- Mandatory for: Corporations (S.A.) and Limited Liability Companies (Ltda.) from the outset.
- For S.A.S.: Only required if your company exceeds these financial thresholds in 2025:
- Gross assets over COP $6,500,000,000
- Gross income over COP $3,900,000,000
If your company doesn’t meet these thresholds, you’re not required to appoint one initially—but it may still be wise to have their guidance as you grow.
4. Approximate Costs to Incorporate Your Company
Starting a company comes with some initial costs that vary depending on the legal structure and amount of capital:
- Legal fees: From COP $2,847,000 if you hire a lawyer to handle the full process.
- Chamber of Commerce fees: Range from about COP $500,000 for small capital companies to COP $1,500,000 for companies with higher capital (around COP $142,350,000).
- Notary authentications: Around COP $7,000 per document.
- Public deed costs: Only required for Ltda. and S.A.
While these may seem high, formally incorporating your business from the beginning can save you from more expensive corrections and penalties later.
5. Can I Incorporate a Company as a Foreigner?
Yes, you can—but there are some important details to consider:
- Banking system: To open a business bank account, most banks will require the legal representative to hold a Colombian ID (cedula de extranjeria) and a valid M or R visa. This isn’t required to register the company itself, but it may limit operations.
- Type of visa: Not all visas allow commercial activity. The most suitable for entrepreneurs are:
- M Visa – Investor: For capital investment in a business or real estate.
- M Visa – Partner or Shareholder: For those investing in a registered company.
- M Visa – Business: For exploring business opportunities without direct employment.
At Nexo Legal, we help you choose the right visa and ensure your immigration status aligns with your business plans.
6. Do I Need to Be in Colombia to Start My Company?
No, you don’t have to be in the country to incorporate your company. You have two options:
- Online platforms: Some Chambers of Commerce in Colombia offer full online registration.
- Special power of attorney: You can issue a notarized and apostilled power of attorney from your country to authorize a lawyer in Colombia to complete the process on your behalf.
Both are 100% legal and practical options for foreign investors who want to establish a presence in Colombia.
7. Legal Benefits of Incorporating a Company
Creating a company in Colombia is not just about formality—it’s a strategic decision with significant advantages:
- Your business becomes a separate legal entity with its own tax ID (NIT), able to enter into contracts and assume obligations.
- Your personal assets are protected: if the company incurs debts or liabilities, only its assets are at risk.
- You gain access to formal opportunities like government bids, commercial alliances, investors, and bank financing.
In short, a well-structured company enhances your credibility, visibility, and growth potential in the local business ecosystem.
8. But Be Careful—It’s Not Just About Incorporating: You Must Stay Compliant
A common mistake is thinking that once your company is registered, you’re done. In Colombia, compliance is ongoing and non-negotiable. These are some of the key obligations to stay up to date with:
Commercial and tax duties:
- Register in the RUT (tax ID system) with DIAN.
- Obtain and renew your business license (mátricula mercantil) annually.
- Maintain accounting books under NIIF or appropriate standards.
- File the Beneficial Ownership Report (RUB).
- Submit tax returns—even with zero income.
Special obligations:
- Data privacy policy (in compliance with Law 1581 of 2012).
- Comply with SAGRILAFT or PTEE if you operate in regulated sectors or exceed income thresholds.
Labor obligations (if you have employees):
- Register employees with health, pension, ARL, and family compensation funds.
- Monthly social security contributions.
- Pay severance, bonuses, vacation, workwear, and comply with labor hours.
- With 5+ employees: internal work regulations are mandatory.
- With 20+ employees: mandatory apprentice quota (SENA).
Failing to meet these obligations can lead to sanctions, tax blocks, and legal issues. At Nexo Legal, we help ensure you’re always compliant.
Starting a company in Colombia in 2025 is a great opportunity—if done right. Forming a company opens doors, but it also brings responsibility. The key is surrounding yourself with trusted experts who understand the legal path.
At Nexo Legal, we’re here from day one: we analyze your case, recommend the best legal structure, manage the paperwork, and help you stay compliant so you can focus on what matters most—growing your business.
Book your free consultation today and let’s build your company on solid ground.
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What will happen after you fill out this form?
After submitting the form, your case undergoes a comprehensive review by our team of specialist to assess its viability. Providing clear and concise information about your objectives accelerates this process.
Subsequently, a specialist will be assigned to your case, reaching out to you within a day to clear up details about your case and outline the next steps to help you achieve your goals.
Get started with a free case assessment
What will happen after you fill out this form?
After submitting the form, your case undergoes a comprehensive review by our team of specialist to assess its viability. Providing clear and concise information about your objectives accelerates this process.
Subsequently, a specialist will be assigned to your case, reaching out to you within a day to clear up details about your case and outline the next steps to help you achieve your goals.
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Phone: (+57) 315 3354174
direccioncomercial@nexo.legal
Calle 11 no. 43b – 50,
Parque Empresarial Calle Once
Oficina 407
Medellín, Colombia
