Last modified: 27/06/2023 14:41

Corporate taxation

	Rate
Corporate income tax rate	27% – 25% (Small Companies)
Branch tax rate	35% (1)
Capital gains tax rate	27% (2) – 25% (3) – 10% (4)

1. Witholding Tax on repatration of profits, (using Corporate income tax as a credit)
2. Tax rate for general companies
3. Tax rate for small companies
4. Stock Market

Residence: A company incorporated in Chile is resident there, as is a company whose central management and control or majority voting power is located there or an essential part of whose operations is located in Chile.

Basis: Chilean-resident companies are taxed on their worldwide income. Non-resident companies are taxed on their Chilean-source income.

Taxable income: Taxable income is based on accounting profits. Chilean-source income is taxed on an accruals basis. Foreign income is included on a net-received basis, unless its source is a permanent establishment abroad, in which case the accruals basis applies. Small and medium-sized enterprises may choose to be taxed on a cash basis.

Significant local taxes on income: Municipal licence on premises located in local-authority area

Alternative minimum tax: Some special additional taxes apply in certain sectors, such as agriculture, mining and transport

Taxation of dividends: Dividends received from abroad, general taxation, Corporate income tax and/or Global Tax (individuals). It is possible to claim supported credits from taxes paid abroad. Dividends received from other Chilean companies are exempt to companies, and Global Tax (individuals).

Capital gains: See under tax rates

Losses: Unlimited use, but not transferable. It is not allowed to carry back.

Foreign tax relief: Foreign income is usually taxable on a net basis.

Participation exemption: No

Holding-company regime: No special regime

Tax-based incentives: There is not particular incentives for foreign investors, just a low tax rate (10%) for capital gains on stock market sales. R&D credit (35%) for project supported by CORFO (Chilean entity) Fixed Assets investment (4% credit) Training.

Group relief/fiscal unity: No

Small company/alternative tax regimes: Yes, Pro Pyme tax regime for small companies (USD 2.5MM)

Corporate taxation: compliance

Tax year: Calendar year

Consolidated returns: No

Filing and payment: April 30th

Penalties: Depending on the taxation, intention or other situations

Rulings: It is possible to ask the tax authorities for a ruling in advance of a transaction. Chilean IRS (SII) constantly is publishing some rules and guidance.

Taxation of individuals

1. Chile has not federal taxes, only national taxes
2. For foreign individuals will depend on the services provided

Residence: 183 days in 12 months (interrupted or not)

Basis: Worldwide for residents. Expatriate workers: Chilean-source only for first 3 years, then worldwide Chilean-source income for non-residents (paid by withholding)

Taxable income: Chile has not federal taxes, only national taxes For foreign individuals will depend on the services provided For chilean individuals is from 0% up to 44,43%

Capital gains: As for income tax

Deductions and allowances: Land Tax Additional payments for future retirement Donations Some losses

Foreign tax relief: Credit, 35% maximum

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Taxation of individuals: compliance

Tax year: Calendar year

Filing and payment: April 30th

Penalties: Based on intention, tax, etc.

Rulings: It is possible to ask the tax authorities for a ruling in advance of a transaction. Chilean IRS (SII) constantly is publishing some rules and guidance.

Withholding taxes

Type of Payment	Resident recipients		Non-residents recipients
	Company	Individual	Company	Individual
	Rate (%)	Rate (%)	Rate (%)	Rate (%)
Chilean Dividends	0%	0%-40%	35%	35%
Interests	27%-25%	0%-40%	35%	35%
Royalties	27%-25%	0%-40%	30%	30%
Technical Assistance	27%-25%	0%-40%	15%	15%

Branch remittance tax: ** Please enter rates of withholding tax in table above on all types of income (dividends, interest, royalties etc)

Anti-avoidance legislation

Transfer pricing: Applied from 2012 (OECD rules)

Interest restriction: Thin capitalisation where debt-equity ratio exceeds 3:1. Interest excess

Controlled foreign companies: Chilean Tax Law establishes CFC rules for Passive foreign companies on 41 G section.

Hybrid mismatches: No

Disclosure requirements: There is country by country reports to be declared until june 30th each year (not for every company, it will depend on headquarters).

Exit taxes: 35% is this what a company pays (on income) if it ceases to be resident in Chile and closes the company.

General anti-avoidance rule: Yes, there is on the Tax Code, section 4 bis.

Digital services tax and Other significant anti-avoidance legislation: Yes, VAT is applied on some cases when companies/individuals are exempt from withholding tax.

Value-added tax/Goods and services tax

Type of tax: Value Added Tax

Standard rate: 19%

Reduced rates: N/A

Registration: Mandatory

Filing and payment: 20th, monthly

Social security contributions

	Employer	Employee
	Rate (%)	Rate (%)
Pension contributions/	0	101
Health	0	Minimum 7
Invalidity	1.15	0
Occupational accident
Unemployment	2.4	0.6

Self-employed

Note 1 for table: Capped at income of CLP 2 682 764 Self-employed people pay mandatory social security contributions.

Other taxes

Capital duty: No

Immovable property taxes: Will depend on the property 0,025% on tax assessment (based on Chilean IRS taxation)

Stamp duty: On loan instruments: 0.066% per month 0.8% maximum cap 0.332% if indefinite

Net wealth/worth tax: No, it is in discussion

Inheritance/gift taxes: Maximum 25% Chilean assets Rates will depend on the amount inherited/donated amount, no differences if it is a chilean or foreigner

Other: No

Tax treaties

Argentina Australia Austria Belgium Brazil Canada China Colombia South Corea Croatia Czech Republic Denmark Ecuador France India Ireland Italy Japan Malaysia Mexico Norway New Zealand Netherlands Paraguay Peru Poland Portugal Russia South Africa Spain Sweden Switzerland Thailand United Kingdom Uruguay