Chile – Lovat Compliance

VAT Standard rate

The standard VAT rate in Chile in 2024 is 19%, which applies to sales, services and imports. Any sale of a good or service made in Chile is subject to VAT.

VAT registration threshold

There is no registration threshold in Chile. All businesses providing activities, which are subject to VAT are required to register and pay VAT in Chile.

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Deductible VAT

VAT in Chile is charged by the seller of goods or services and then collected from the buyer.
Then the supplier reports and pays the collected VAT to the tax authorities. Also, VAT taxable persons may deduct VAT paid on inputs from VAT charged on sales and report the difference to the tax authorities.

Export supplies are exempt from VAT, but it is possible to refund VAT paid on export activities in the form of cash refunds. Input tax charged by businesses that are not registered as VAT payers in Chile is not subject to refund.

Registration procedure

All businesses must file an application form to start a business and an application for a taxpayer identification number (RUT). It should be submitted to the Chile Tax Department’s Web site.

Keeping records

The period of keeping records in Chile must be six years, starting from the reporting period to which the records refer.

VAT returns filing and payment date

VAT returns in Chile are submitted on a monthly/quarterly basis. VAT payers should file return and pay VAT electronic returns before the 20th day of the month following the reporting period. VAT returns should be paid in Chilean pesos (CLP).

Penalties

In case of late payment and filing of the VAT return in Chile penalties 1.5% per month are applied. Fines equal to 10-60% of the tax due are also levied.

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This guide covers only the taxation of digital services. If you sell goods, this guide does not apply.

Law No. 210 of February 24, 2020, establishes that paid remote services provided by non-residents not residing in Chile must pay value-added tax (VAT) from June 1, 2020.

VAT Standard rate

The standard VAT rate in Chile in 2024 is 19%.

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Threshold

The threshold is not set.

Who should register?

Taxpayers without domicile or residence in Chile provide remotely taxed services acquired in Chilean territory by natural or legal persons.

E-services list

Digital entertainment content, like audiovisual service, music, games, or other analogs, through downloading, streaming, or other technologies, including texts, magazines, newspapers, and books for these purposes.

Software, storage, platforms, or computing infrastructure.

Advertising, regardless of the means or means by which it is delivered, materialized, or executed.

Pieces of evidence

The service will be considered delivered in Chile if at least two of the following conditions are met:

The IP address of the network used is in Chile;
Billing address;
Buyer’s bank address;
Chilean SIM card.

Registration procedure

The registration procedure is effortless. It is enough to send the registration form to the tax website. Simultaneously with registration, you will receive a personal account with which you will need to file tax returns.

The type of currency (US dollars, Euros, or Chilean pesos) and the frequency of declaration and payment must be specified during registration. After the elections are held, they cannot be changed until January 1 of next year.

Tax representative

A representative is required for registration. This can be a foreigner or a local person with a valid local identity card and who is registered with the Tax Authorities.

VAT filing and payment

Declarations are submitted on a monthly/quarterly basis. You can choose a convenient period for you in the application for registration. The deadline for filing and deadline for payment of the declaration is the first twenty days of the month following the period to be announced.

For declarations in foreign currency, the corresponding tax must be paid using a SWIFT transfer, which is identified by a SWIFT code or a BIC code (bank identifier). This code allows you to identify the receiving bank when making an international transfer.

Penalties

The interest of 1.5% for each month the VAT is not reported and paid.

Fines: 10% – 60% may fall due.

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