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Corporate tax

Tax rate for resident companies

The corporation income tax legislation provides 2 types of taxes.
The First Category Tax is levied on income derived from commercial, industrial and agricultural activities, mining, fishing; investment and real estate. The tax rate is 17%.
The Second Category Tax refers to incomes arising from wages, salaries, overtime payments, bonuses, fees, gratuities, profit sharing and any other form of remuneration. It is a progressive rate which highest rate is 40% applicable on monthly basis.

Tax rate on long-term capital gains Capital gains are included in gross income subject to First Category tax with certain exceptions.
System governing groups of companies and dividends paid by subsidiaries to their parent companies The amounts distributed or remitted to non-resident or non-domiciled shareholders are subject to a 35% additional tax with a credit of the current rate of the First Category Tax.
Tax rate on branches Branches are subjected to a tax at the rate of 35%,

Income tax

Fiscal year The fiscal year begins on January 1-st and ends on December 31 of the same year.
Income tax rate The rate is progressive from 0% to 40%.
The rate depends on monthly units of levy (the value of a unit in CLP is revalued each month):
Lower than 13,5 units0%
13,5-30 units5%
30-50 units10%
50-70 units15%
70-90 units25%
90-120 units 32%
120-150 units 37%
Beyond 150 units 40%
Tax deductions or other allowances Tax credit of 10% and other fixed deductions are allowed.

VAT rates

Standard rates 19%
Reduced rates Are exempted of VAT exports, certain financial services, insurance, news services, technical services, consultancy and transport.

Other important taxes

Name of tax
Municipal tax  
0,25% to 0,50% (of assets)  
Other taxes  
Inheritance or gift tax, mining tax, property tax, sales tax on luxury goods, stamp duty  



Chilean financial accounting is tax returns orientated.

General accounting principles
- stocks: they are calculated with the " First in - First out " method.
- fixed assets: buildings, shares and bonds bought by the company.
- capitalization interests : interests incurred on fixed assets (shares and bonds).
- depreciations : there are several calculating methods for depreciations.
- investments and long-term fundings.
- research and development costs : they must be registered and paid off over a period of more than 6 years.
- interests for bills relative to accounts receivable and payable.
- provisions for redundancy payment.
- long term contracts.
- extraordinary costs : they appear in the profit and loss account.

Obligations and publications
Companies have to produce their their annual financial statement to the shareholders.
The account books must be published in Spanish and use the Chilean currency as reference.

Certification and auditing
External audits are compulsory for companies with capital and foreign investors with repatriated profits.

Professionals and representative organizations
The main representative body is the association of the Chilean bookkeepers: "the Association of Accountant in Chile".

Useful links
Internal Revenue Service

Last modified in January 2007
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