Chilean SII Clarifies VAT and Tax Rules for Foreign Service Providers After 2025 Ruling

• The Chilean Tax Authority (SII) issued Letter Ruling No. 2627 in December 2025, clarifying VAT and income tax treatment for non-resident service providers.
• Spanish companies providing software installation services in Chile are generally subject to VAT unless an exemption applies due to Additional Tax or a tax treaty.
• Under the Chile-Spain tax treaty, Spanish companies are only taxed in Spain unless they have a permanent establishment in Chile.
• If there is no permanent establishment, the Chilean recipient must pay and can usually recover the VAT.
• Both foreign service providers and local recipients must consider domestic VAT rules and international treaties to determine tax obligations.

Source: vatabout.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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