|Rodrigo Winter||Pedro Lecaros|
The former provision treated differently certain disallowed disbursements representing cash disbursements depending on the taxpayers' legal structure. In this sense, under the previous law, disallowed expenses in a Stock Corporation (Sociedad Anónima or SA) or sociedad por acciones (SpA) were taxed with a 35% sole penalty tax. On the other hand, disallowed expenses regarding other legal entities were treated as a deemed distribution to the quota holders, taxed accordingly with surtax or additional withholding tax.
New article 21 simplifies the system, equalising the taxation of the disallowed expenses irrespective of the corporate form of the entity of source.
In this sense, new article 21 establishes a 35% tax rate, applicable to disallowed cash disbursements and other kind of disbursements applicable as a sole tax to the entity of source of the disallowed expense. That is to say, after article 21 operates, no further taxation is applied.
Nonetheless, in certain cases, for example in certain disbursements that can be directly linked to a specific share/quotaholder, benefits obtained by the use of the company's assets, among others, such disbursement will be treated as a deemed distribution subject to surtax or additional withholding tax, plus an additional 10% penalty. Therefore, if the owner is a foreign company, 35% additional withholding tax will be triggered plus the additional 10% penalty. On the other hand, if the owner is an individual resident in Chile, he will be subject to surtax, plus the 10% additional penalty.
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