Chile: simplified registration for non-resident VAT taxpayers
One of the main concerns for a foreign entity seeking to operate in Chile while providing digital services directly from abroad is the possibility of being required to establish a formal company in the country in order to comply with its tax obligations.
Action taken by the Chilean government
Local regulations have addressed this issue since 2020, with the entry into force of Law No. 21,210, also known as the "Tax Modernization Law." This law establishes a simplified taxpayer registration procedure, allowing taxpayers to register with the Chilean Internal Revenue Service (Servicio de Impuestos Internos, or SII) and begin paying their local VAT obligations without having to establish a formal company in Chile.
Initially, this regulation was linked to digital services provided by foreign taxpayers in B2C (Business to Consumer) transactions, including the following:
- Intermediation of services provided in Chile, regardless of their nature, or sales made in Chile or abroad, provided that the latter give rise to an import.
- The supply or delivery of digital entertainment content, such as videos, music, games, or similar content, through downloads, streaming, or other technologies. The regulation also covers texts, magazines, newspapers, and books.
- Making software, storage, platforms, or IT infrastructure available.
- Advertising, regardless of the format or medium through which it is delivered, materialized, or carried out.
However, under Law No. 21,713, known as the "Tax Compliance Law," the concept of "digital services" has been expanded to include "remote services."
What does this change mean in practice?
Taxpayers who are neither domiciled nor resident in Chile and who provide services to individuals located within the country may qualify for the simplified tax regime, provided they meet the requirements established by law.
For reference, the following table compares the obligations applicable to taxpayers under the general and simplified regimes:
| Description of local obligations | General regime (Art. 14 A, Decree-Law No. 824) | Simplified regime (Art. 35 A, Decree-Law No. 825) |
| Full accounting records | Yes | No |
| Monthly tax returns (Forms 29, 50, 24) | Yes | No |
| Annual tax returns (Form 22) | Yes | No |
| Additional sworn statements accompanying corporate income tax returns | Yes | No |
| Transfer pricing compliance | Yes | No |
| Monthly/quarterly tax returns (Form 129) | No | Yes |
| B2C sales sworn statement | No | Yes |
The SII has launched a portal providing further information on this topic. In addition, the tax authority has published a list of entities identified as non-compliant because they have not registered under this simplified registration scheme.
Need help ensuring your business can operate in Chile? Contact Auxadi's local experts to gain an in-depth understanding of your multinational group's tax obligations in the country.
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Author:
Belén Isla
Tax Manager – CL
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All information contained in this publication is up to date on 2024. This content has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice.No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this content, and, to the extent permitted by law, AUXADI does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.
