- VAT on Foreign Services: Services provided in Chile by a foreign company, such as software installation, are subject to VAT unless a specific exemption related to the additional tax under the Income Tax Law (LIR) applies.
- Exemption and Treaties: The VAT exemption applies if the services are subject to the additional tax under the LIR and are not exempted by other treaties. Additionally, the treaty between Chile and Spain stipulates that business profits of a Spanish company are only taxable in Chile if they are conducted through a permanent establishment in the country.
- Responsibility of the Beneficiary: If the exemption is not applicable, the beneficiary of the service in Chile must assume the VAT responsibility by issuing a “purchase invoice” and directly declaring the tax to the tax authorities, which may allow them to access a tax credit.
Source sii.cl
Latest Posts in "Chile"
- SII Updates: New Rules for Supplier Formalization, Electronic Receipts, and Delivery Note Registry
- Establishment of Simplified VAT Tax Regime for Small Taxpayers
- Updated VAT Withholding List for International Digital Service Providers
- Establishment of a Simplified VAT Taxation Regime for Small Taxpayers
- New VAT Rules for Fuel Deliveries Exiting Non-Customs Warehousing: Orders, Guarantees, and Procedures
