The Internal Revenue Service has issued Circular 78, which provides special instructions about the procedure through which taxpayers must notify the agency about the destruction, loss of stock in inventory or loss or mutilation of accounting records or documents allowing accredited accountants. This procedure has been created for those companies located in Choapa and Coquimbo areas, affected by the earthquake and the tsunami which took place last September 16th.

Obligation to report losses in inventories (contained in Circular No. 3 of 1992)

The affected must give notice of this situation within 48 hours after the disaster. This notice must be made in the corresponding office to the affected taxpayer.

A special term has been implemented for the disaster area, and must be requested through Form 2117, detailing the circumstances of the request. The deadline won’t be extended beyond December 31st, 2015.

Accreditation of losses and inventories actual income statement

For those affected with the loss of goods or inventory, if they keep books, records and supporting documents, should consider submitting these documents with annotated daily control of stocks or inventories (Exempt Resolution No. 985 of 1975) if applicable or tax documents authorized by the SII used for document commercial operations.

They will be accepted, among other documents, photographs, records, records and press clippings. Reports and/or certificates of a list of institutions specified in Circular No. 78 of 2015 (Section II, letter b) will also be considered. The taxpayer affected by losses may request a physical realization of the same through the Form N ° 2117.

Accidental loss or disablement of books or accounting entries

According to Article 97 No. 16 of the Tax Code, taxpayers must report this situation within 10 days of the occurrence of the event, using Form No. 3238 or Form No. 2117.

Rebuilding the accounting within 30 days

Finally, Circular 78 informs about the tax effects of the enactment of Supreme Decree No. 1227 establishing the áreas affected by the disaster in terms of donation. All these instructions from SII are in force from the business day following the catastrophe, September 17th, 2015.