Country Trading Profiles Chile - Taxes

Tax Rates

Nature of the tax: Value Added Tax
Tax rate: 19%
Reduced tax rate: Are exempted of VAT exports, certain financial services, life insurance, news services, technical services, consultancy and transport.
Other consumption taxes: A tax of 51% is applied to cigars; in the case of cigarettes the tax is 60.04%. These taxes apply to the selling price to the final customer. A tax on fuel is applied to producers and importers. Diesel fuel is subject to a rate of 1.5 UTM per m³. Petrol for cars is subject to a rate of 6 UTM per m³.

The First Category Tax is levied on income derived from commercial, industrial and agricultural activities, mining, fishing; investment and real estate.	20%
The Second Category Tax refers to incomes arising from wages, salaries, overtime payments, bonuses, fees, gratuities, profit sharing and any other form of remuneration.	progressive rate: highest rate is 40% applicable on monthly basis.

Capital gains taxation: Capital gains are included in gross income subject to First Category tax with certain exceptions: capital gains are tax exempt if derived from transactions of first public offerings and listed corporations.
Main allowable deductions and tax credit: Expenses are deductible for depreciation and depletion, net operating losses, payments to foreign affiliates, taxes.
Other corporate taxes: There are also a stamp tax, municipal license fee, real property tax, social security contributions.

Personal Income tax	The rate depends on monthly units of levy. The value of a unit in CLP is revalued each month. Progressive rates up to 40%.
Lower than 13,5 units	0%
13,5-30 units	5%
30-50 units	10%
50-70 units	15%
70-90 units	25%
90-120 units	32%
120-150 units	37%
Beyond 150 units	40%

Allowable deductions and tax credit: Tax credit of 10%; and deductions for interest paid on a mortgage for the construction or acquisition of a dwelling, and for pension contributions.
Special expatriate tax regime: There are no fiscal advantages for expatriates.

Countries with whom a double taxation treaty have been signed: See the list of the convention signed
Withholding taxes: Dividends: 35%, Interest: 35%, Royalties: 30%
Bilateral agreement

Tax year: The fiscal year begins on January 1-st and ends on December 31 of the same year.
Accounting standards: Chilean GAAP (generally accepted accounting principles), and progressively adopting the IFRS (International Financial Reporting Standards).
Accounting regulation bodies: Ministry of Finance
Accounting reports: The basic financial statements include: the balance sheet, the statement of income, the statement of cash flows, and the notes to the financial statements.
Publication requirements: Companies have to produce their annual financial statement to the shareholders.
The account books must be published in Spanish and use the Chilean currency as reference.
Professional accountancy bodies: Colegio Contadores
Certification and auditing: External audits are compulsory for companies with capital and foreign investors with repatriated profits. You can contact an external auditor: Deloitte, KPMG, Ernst & Young, PricewaterhouseCoopers,
Accounting news: Finance news online
"El Mercurio" Financial News