Cross-Border Tax Transparency: The Impact of the MAC Convention and Residency Rules on Colombia-Peru Relations

1. Introduction: The Challenge of Tax Evasion in Latin America

The mobilization of domestic resources and the consolidation of equitable tax systems represent two of the greatest structural challenges for Latin American economies. In a globalized environment where capital flows and cross-border investments are executed with extreme speed, tax administrations face information asymmetries that have historically facilitated base erosion and profit shifting (BEPS). According to the Latin America Tax Transparency Progress Report published by the Organisation for Economic Co-operation and Development (OECD) in 2026, tax evasion causes substantial losses in the region's revenue. As the report literally states, "La recaudación tributaria que se pierde debido a la evasión fiscal es significativamente elevada en la mayoría de los países latinoamericanos, ascendiendo al 6.7 % del producto interior bruto (PIB) de la región, según algunas estimaciones." This alarming figure highlights the urgent need to strengthen audit mechanisms and deepen international cooperation.

To counteract this phenomenon, countries in the region have had to transition from purely domestic auditing schemes to an international tax transparency model based on the automatic exchange of information. In this context, the bilateral and cross-border relationship between Colombia and Peru precisely illustrates how convergence toward OECD standards redefines taxpayer obligations and provides tax authorities, the National Directorate of Taxes and Customs (DIAN) in Colombia and the National Superintendency of Customs and Tax Administration (SUNAT) in Peru, with tools to identify undeclared assets held abroad.

2. The Multilateral Framework: The Punta del Este Declaration and Binding Instruments

The political and technical pillar supporting the transparency strategy in the region is the Punta del Este Declaration. Originally signed in November 2018, this declaration emerged as a joint effort to address structural weaknesses in revenue collection and combat illicit financial flows, promoting regional cooperation.

It is essential to clarify the legal nature and scope of the Punta del Este Declaration to avoid common confusions in professional practice. It is not a free trade agreement or a supranational tax code. Nor should it be confused with a binding legal instrument for lifting bank secrecy. While the Punta del Este Declaration acts as the political framework for regional momentum, the true legal basis that enables and obligates the automatic exchange of financial information between Colombia and Peru is the Convention on Mutual Administrative Assistance in Tax Matters (MAC) and the Multilateral Competent Authority Agreement (MCAA).

Refining this framework, this scheme is distinct from Decision 578 of the Andean Community (CAN). The substantive tax relationship between Colombia and Peru is not governed by a bilateral Double Taxation Treaty (DTT) based on the OECD model, but exclusively by Decision 578 of the CAN, which is a supranational community norm based on the source principle, whose rules of distribution of tax jurisdiction and residence differ substantially from traditional DTTs.

Moreover, these multilateral instruments are distinct from the Controlled Foreign Corporation (CFC) regime, which constitutes a strictly domestic anti-avoidance rule designed to attribute passive income obtained by foreign vehicles to their local tax resident beneficial owners. Although the information obtained through international channels facilitates auditing, the application of the Colombian CFC regime to Peruvian vehicles faces a debate regarding constitutionality and legality in light of the primacy of Decision 578 of the CAN, as the latter is a rule of exclusive taxation at the source.

3. Tax Residency Rules in Colombia as a Trigger for Global Obligations

The practical impact of these international standards is particularly evident when analyzed in combination with the tax residency rules enshrined in the domestic legislation of each country. In the case of Colombia, Article 10 of the Tax Statute establishes objective criteria to determine when an individual acquires tax resident status. The main criterion, and the most relevant for individuals with cross-border mobility, is physical presence.

According to the DIAN, within the framework of the concept of residency, objective criteria are established to determine when an individual is considered a resident for tax purposes. The 183-day threshold operates as the primary objective criterion for establishing tax residency, without prejudice to the exceptions and additional conditions that the law provides.

Once an individual exceeds this temporal limit and their tax residency in Colombia is established, the taxpayer is obligated to declare all assets held both in Colombia and abroad. However, it is crucial to specify that in the Colombia-Peru corridor, the substantive tax relationship is governed by Decision 578 of the Andean Community (CAN). Under this supranational and preferential community norm, the principle of exclusive taxation at the source applies. Therefore, although the Colombian tax resident must declare their global assets (including those located in Peru) in their Declaration of Assets Abroad, the income obtained in Peruvian territory is exempt in Colombia and cannot be doubly taxed by DIAN. This obligation includes filing the Declaration of Assets Abroad, a formal duty whose non-compliance or late filing carries severe financial penalties and the potential determination of non-existent liabilities or omitted assets as taxable net income through equity comparison.

4. The Causal Chain of Automatic Exchange of Information (AEOI/CRS)

To understand the real risk faced by taxpayers who omit declaring their cross-border assets, it is illustrative to examine the causal chain activated under the Common Reporting Standard (CRS), promoted politically by the Punta del Este Declaration and legally supported by the MAC.

Let us consider the scenario of a citizen who, after remaining more than 183 days in Colombia within a mobile 365-day period, is determined to be a Colombian tax resident. This taxpayer maintains bank accounts, deposits, or financial investments in Peru that have not been reported in their declaration of assets abroad in Colombia. The detection and auditing process unfolds as follows:

1. Residency Identification by the Financial Institution: Peruvian financial institutions, under local due diligence rules of the CRS standard, identify the tax residency of their account holders. If the account holder provides indications of residency in Colombia, such as an address, telephone number, or self-certification, the Peruvian financial institution registers the taxpayer as a Colombian tax resident.
2. Reporting to SUNAT: Annually, financial institutions in Peru report the information of these accounts, balances, interest, dividends, and identification data of the ultimate beneficial owner, to SUNAT.
3. Transmission of Information to DIAN: Under the legal protection of the Convention on Mutual Administrative Assistance in Tax Matters (MAC) and the Multilateral Competent Authority Agreement (MCAA), SUNAT securely and in a standardized manner transmits this financial information to DIAN.
4. Data Processing and Cross-Matching by DIAN: DIAN receives the database and proceeds to perform a systematic cross-match with the tax returns filed by the taxpayer in Colombia. Upon identifying that the Colombian tax resident holds financial assets in Peru that were not included in their Declaration of Assets Abroad, the administration detects an asset discrepancy.
5. Issuance of Requirements and Official Assessment: Based on the international information received, DIAN issues a summons to declare or a special requirement, demanding the regularization of the omitted assets. If the taxpayer does not disprove the inconsistency, DIAN proceeds to issue an official review assessment, determining the omitted tax, adding penalties for inaccuracy and late filing, and applying the corresponding default interest.

This causal chain demonstrates that, in the era of tax transparency, the omission of assets abroad no longer depends on physical audits or selective information requests; detection has become an automated and systematic process.

5. Technology, Artificial Intelligence, and Due Process in Tax Audits

The automation of auditing processes and the use of advanced technologies by tax administrations raise important questions about the protection of taxpayers' fundamental rights and respect for due process. Although big data analysis tools are indispensable for processing the records exchanged annually under the CRS standard, their implementation must be subject to strict ethical and legal limits.

In the Colombian context, DIAN, when performing automated administrative audits and massive data cross-matching, is governed by the general principles of administrative due process enshrined in Article 29 of the Political Constitution of Colombia and the audit rules of the Tax Statute. In this regard, Judgment T-323/24 of the Constitutional Court of Colombia has established fundamental guiding criteria for the use of technologies and automated decision-making tools or artificial intelligence by authorities. These criteria include transparency (the obligation to clearly and precisely demonstrate the use, scope, and location of the results obtained to allow full knowledge and effective contradiction) and responsibility (the obligation to understand the impacts of these technologies and account for their suitability). Thus, taxpayers subjected to audit processes originating from automatic cross-matching of international information have the right to know precisely what data was received from SUNAT, how it was processed, and to have a real and effective opportunity to dispute the information before an official assessment is issued.

6. Comparative Analysis of International and Domestic Instruments

To ensure proper tax planning and regulatory compliance in cross-border operations between Colombia and Peru, it is essential to distinguish the scope of the different instruments that coexist in the tax ecosystem. The following table summarizes the fundamental differences:

This distinction shows that the Punta del Este Declaration does not alter substantive tax rules or grant tariff benefits or tax exemptions; its function is strictly operational and informative, serving as a support so that the substantive rules of each country are applied with full efficacy.

7. Economic Context and Growth Challenges in Peru

The implementation of tax transparency reforms and the strengthening of revenue collection do not occur in a vacuum but respond to the macroeconomic realities of each jurisdiction. In the case of Peru, the country has faced a complex economic environment over the last decade, which is reflected in official publications such as the OECD Economic Surveys: Peru 2025.

This outlook highlights the need to safeguard fiscal sustainability by broadening the tax base and decisively combating evasion. For a country with moderate growth rates, the loss of tax revenue due to cross-border evasion represents an unacceptable opportunity cost that limits investment in infrastructure, education, and essential public services. Hence, Peru's active participation in the Latin American Initiative and its commitment to the automatic exchange of information with strategic partners like Colombia constitute priority state policies to ensure stable resources without unnecessarily increasing nominal tax rates on formal taxpayers.

8. Conclusions and Practical Recommendations

The era of bank secrecy and asset opacity in Latin America has come to an end. The integration of Colombia and Peru into global tax transparency standards, under the framework of the MAC Convention and OECD guidelines, consolidates an environment where financial information flows automatically and systematically between tax administrations.

Best practices for regulatory compliance suggest that taxpayers with cross-border interests maintain monitoring of the following aspects:

• Monitor Physical Presence and Asset Declaration: It is essential for individuals traveling frequently between Colombia and Peru to keep a rigorous record of their days of presence in Colombian territory. Although Peruvian-source income is exempt in Colombia under CAN Decision 578, exceeding 183 days triggers the obligation to file the Declaration of Assets Abroad with DIAN.
• Preventive Audit of Foreign Assets: It is essential for taxpayers to review the status of all bank accounts, investments, and corporate participations held in Peru to ensure they have been properly reported to DIAN, thus preventing a CRS automatic exchange from triggering punitive auditing processes.
• Demand Due Process: In the face of any requirement from the tax administration based on international data, taxpayers have the right to demand full respect for the principles of transparency and contradiction established in Judgment T-323/24 of the Constitutional Court, verifying the accuracy of the transmitted information and ensuring that decisions affecting their assets are not applied in an arbitrary or purely automated manner.

International tax transparency should not be viewed solely as a mechanism of state control, but as a guarantee of tax equity that protects compliant taxpayers against the unfair competition of informal evasion, laying the foundations for sustainable and orderly economic growth in the region.

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Disclaimer: The information contained in this article is of a general and educational nature and does not constitute personalized tax, legal, or professional advice. Taxpayers are advised to consult with a qualified professional advisor before making decisions based on this information.