- Chile’s tax authorities clarified VAT and tax treaty rules for software licensing and sublicensing in cross-border cases.
- Software acquired from the US for resale is subject to VAT, not withholding tax, unless the supplier has a permanent establishment in Chile.
- Sublicensing software to foreign customers is generally VAT-taxable but may be exempt if certified as an export service.
- The ruling shifts the tax burden from withholding tax to VAT, depending on whether the sublicensing qualifies as an export service.
Source: bdo.global
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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