The Colombian Tax Authority DIAN (Dirección de Impuestos y Aduanas Nacionales) requires that companies, public institutions, and natural persons report their annual financial operations by business partner through the Magnetic Media scheme, also called Exogenous Information.

For the Colombian localization, the required data can be generated in these legal reports, as defined in the Colombian Resolution number 000124 and its annexes:

  • Format 1001 – Expenses and related VAT and withholdings
  • Format 1003 – Withholding tax charged at source by the customers
  • Format 1005 – Deductible VAT from Purchases and returned Sales
  • Format 1006 – Generated VAT from Sales and returned Purchases
  • Format 1007 – Gross Revenues
  • Format 1008 – Accounts Receivable Balances as of December 31st
  • Format 1009 – Accounts Payable Balances as of December 31st

These steps are completed in the process:

  1. Master data configuration
    • In the DIAN Report Formats (lpcol4120m000) session, the predefined Magnetic Media format codes are initiated by the Generate Supported Report Formats action.
    • In the Concepts by DIAN Report Format (lpcol4121m000) session, you configure the relationship between a format and the concepts, which are minor groupings or subgrouping of information specified in the Magnetic Media resolution. The available parametrization enables you to specify these relationships as indicated in the resolution.
    • In the Accounts by Report Format and Concept (lpcol4122m000) session, the accounts are assigned to each format and concept.
    • In the Transaction Types to Report (lpcol4124m000) session, you specify if the transaction types created in LN CE must be reported on Magnetic Media.
    • In the DIAN Report Format Fields (lpcol4126m000) session, the information fields of the partner and the values to be extracted are configured, including the identification document type, number, and other details.
    • In the Country DIAN Codes (lpcol0112m000) session, the country codes that are defined by DIAN are assigned.
  2. Magnetic media process
    • The Generate Magnetic Medium Transactions (lpcol4430m000) session extracts the accounting and withholding tax information.
    • The Generate Supplier Balances (lpcol4430m001) session extracts the information for the balances of the supplier documents from the Accounts Payable module. The Generate Customer Balances (lpcol4430m002) session extracts the information for the balances of the customer documents from the Accounts Receivable module. For both sessions, an additional report is generated listing the omitted documents.
    • The Classify Transactions According Minimum Value to Report (lpcol4430m003) session classifies the summed amount by Year, Partner, Format, and Concept, based on the definition of the minimum value to report. It also updates the status of the record.
    • The Generate Magnetic Medium Details (lpcol4235m000) session consolidates the information by Year, Partner, Format, and Concept and populates the partner's information fields such as address, country, and municipality. Additionally, it changes the company name or name of the partners with smaller amounts, as required by the Colombian Authorities. For example, tax identification: 22222222222, company name CUANTÍAS MENORES.
    Note: These sessions must be run when no financial transactions are being inserted in LN CE by users.
  3. Validation of the generated data
    • The Transactions Magnetic Media (lpcol4530m000) session allows a detailed query of the extracted transactions.
    • From the Generate Magnetic Media Transactions (lpcol4430m000) session, you can download and review the information from Magnetic Media in Microsoft Excel before uploading it to the DIAN.
  4. DIAN applications

    The DIAN application Tax Prevalidador (Prevalidador Tributario in Spanish) can be used to convert the extracted data into XML files, which are flat files that are required for the transmission of the information through the application on the DIAN web page.

    The DIAN application MUISCA (Single Model of Entry, Service, and Automated Control) can be used for registering the files corresponding to Magnetic Media. Within the DIAN application, the files are placed in the taxpayer's inbox. The request to send the files can be filled out and the files can be sent.