International Tax Review is part of the Delinian Group, Delinian Limited, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 00954730
Copyright © Delinian Limited and its affiliated companies 2023

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Chile: Transitory regime for goods and income located or perceived abroad



Sandra Benedetto

Santiago Lopez

On September 29 2014, Law 20,780 was published in the Chilean Official Gazette, introducing comprehensive amendments to Chile's tax legislation. Among its provisions, the tax reform package included a Voluntary Transitory Regime regarding certain goods and income situated or perceived abroad, which were not appropriately declared and paid in Chile as required by law, allowing the payment of a sole and substitutive tax at a 8% rate, provided certain requirements are met.

The Transitory Regime has been designed taking into consideration OECD and FATF [Financial Action Task Force] guidelines, especially regarding those controls required to avoid its abuse and (mis)use for purposes other than those considered by the Chilean legislator. The regime will be available until December 31 2015.

Who can benefit?

This Transitory Regime is only available for taxpayers domiciled or resident in Chile, established or incorporated in the country, before January 1 2014. Taxpayers who have been sentenced or prosecuted for money laundering, terrorism financing, bribery, or tax fraud would not be able to benefit from the Transitory Regime.

Which goods can be included?

Intangible nominative goods, such as shares, quota rights, benefits in a trust, financial instruments, bonds, investment fund quotas and, generally, any other nominative credit or investment title payable in foreign currency. Foreign currencies are also included, as is any other income derived from the previously referred goods (dividends, profits, capital gains, interest, among others).

How do you apply?

To apply to this Transitory Regime, a special affidavit shall be submitted before the Chilean Internal Revenue Service (IRS), along with an inventory of the goods and with the relevant facts and supporting documentation that proves that all legal requirements are complied with. In this regard it is advisable to review, in advance, all antecedents and documentation to be sure that the transitory regime would indeed apply and that all requirements are met. Once the affidavit is submitted, Chilean IRS will have a five day term to respond and the taxpayer a subsequent 10 day term to pay the tax. Once payment is made, Chilean IRS will have 12 months to audit any matter in connection with the Transitory Regime.

How does it work?

The 8% tax is a sole and substitutive tax; therefore, no further taxes should be applied upon the declared goods and income. This tax is applied upon the fair market value of the declared goods, which for future purposes will constitute its tax cost.

In addition, any administrative, civil or criminal responsibility derived from the non-compliance of foreign exchange, tax, corporate or stock exchange law will be extinguished ipso jure.

The Transitory Regime also allows the taxpayer to relocate and register in Chile, underlying assets registered in foreign companies, trusts, foundations, provided that those entities are dissolved, that the 8% tax is paid, and that other requirements are met. This relocation will be deemed a reorganisation and will not configure a disposal for Chilean purposes, provided that it is made at fair market value, being the Chilean IRS deprived from its valuation faculties.

Sandra Benedetto ( and Santiago Lopez (

PwC Chile

Tel: +562 29400155 and +56 229400556


more across site & bottom lb ros

More from across our site

The winners of the ITR Europe, Middle East, and Africa Tax Awards 2023 have been announced!
The winners of the ITR Asia-Pacific Tax Awards 2023 have been announced!
Mauro Faggion appeared cautiously optimistic as the European Commission waits to see whether all 27 member states will accept its proposal.
The global minimum rate also won’t entirely stop a race to the bottom, according to a tax director speaking at an ITR conference in London.
The country’s tax authorities are not interested in seeing transfer pricing studies any more, it was claimed at an ITR industry conference in London.
The controversial measure is being watered down after criticism from the European Central Bank.
More than 600 such requests were made in 2022, while HMRC has also bolstered its fraud service, it has been revealed.
The General Court reverses its position taken four years ago, while the UN discusses tax policy in New York.
Discussion on amount B under the first part of the OECD's two-pronged approach to international tax reform is far from over, if the latest consultation is anything go by.
Pillar two might be top of mind for many multinational companies, but the huge variations between countries’ readiness means getting ahead of the game now, argues Russell Gammon, chief solutions officer at Tax Systems.