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Chile

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Tax authorities

Servicio de Impuestos Internos
Teatinos 120, Santiago de Chile
Tel: +56 2 473 2000
Website: www.minhda.cl/ministerio.php

Tax rates at a glance

(As of September 2009) 

Corporate income tax rate (%) 17
Capital gains tax rate (%) 17/35
Branch tax rate (%) 17

Withholding tax (%)
Dividends 35(a)(b)
Interest 35(a)(c)
Royalties from patents, trade marks, formulas and Similar Items 30(a)(d)
Technical services 20(e)
Other fees and compensation for services rendered abroad 35(a)
Branch remittance tax 18(f)

Net operating losses (years)
Carryback Unlimited
Carryforward Unlimited

(a) The tax applies to payments to nonresidents.
(b) The 35% tax is applied to the amount of the grossed-up dividend. A credit is available for the corporate tax paid, resulting in a 21.7% effective tax rate on the amount of the net dividend.
(c) A reduced rate of 4% applies to interest paid on loans granted by foreign banks or financial institutions or paid with respect to import operations.
(d) The withholding tax rate is reduced to 15% for payments with respect to the following: invention patents; models; industrial drawings and designs; layout sketches or layouts of integrated circuits; new vegetable patents; and the use or exploitation of computer programs (software). The reduced tax rate does not apply to payments made to related parties or to companies resident in countries included in a list prepared by the Chilean Ministry of Finance containing the territories considered to be tax havens. As a result, the withholding tax rate for such payments is 30%. Two companies are considered to be related if one of the following conditions is satisfied: either company owns 10% or more of the other company's capital; either company participates in 10% or more of the other company's revenues; or a shareholder or owner owns 10% or more of each company or participates in 10% or more of its revenue.
(e) A reduced 15% rate applies to payments for engineering, technical assistance, professional and other technical services rendered in Chile or abroad. However, if the parties are related (see footnote [e] above) or if the payments are being made to a company domiciled in a country included in the tax-haven list (see footnote [e] above), the withholding tax rate is 20%.
(f) The 35% tax is applied to the grossed-up branch remittance. A credit is available for the branch level tax paid, resulting in a 21.7% effective tax rate on the amount of the net remittance.

Source: Ernst & Young

Tax

The Chilean economy has been somewhat sheltered from the global financial crisis by the high price of copper, which is abundant in Chile. The government had saved some money from exporting the metal in recent years and was able to draw on these reserves ... [more]

Carey y Cía is a stand-out law firm in Chile. The tax department is tremendously successful and well recognised. "It is a very important firm in this market," said a competitor. In the last year the firm took the innovative step of adding two tax accountants ... [more]

The tax department at Ernst & Young added two new partners in the last year bringing the total group to150 professionals (40 lawyers and 110 accountants) dedicated to all the different tax specialities including general corporate tax law, international ... [more]

PricewaterhouseCoopers offers a diverse client list a full range of tax services. The large, competent team is well respected in the marketplace and continues to grow despite tough economic times.

Barros & Errázuriz - Taxand provides a broad range of services to clients. The tax department comprises two partners and six practitioners who are dedicated exclusively to tax matters, helping clients with corporate, national and international tax planning ... [more]

Deloitte serves a wide variety of clients in Chile. The full-service practice is able to draw on the firm's worldwide network to provide clients with first rate domestic and international tax advice.

KPMG has had a stable year, with no significant hires or departures from the group. The team of 70 advisers offers a full range of tax services to an impressive client list. The firm penetrates significantly into the mining industry and has advised on ... [more]

Clients rave about the tax group at Baraona Marré Abogados saying that the advisers "always get very involved in all aspects of the transaction under analysis and provide accurate advice in a reasonable amount of time". Juan Manuel Baraona is highlighted ... [more]

Sebastián Obach is a tax partner at Cariola Diez Perez-Cotapos & Cia. The firm aims to provide clients with a full range of services need to conduct business in Chile. The small tax group has a recognised presence in the mining industry, counting many ... [more]

Philippi, Yrarrázaval, Pulido & Brunner has started to strengthen its tax practice in preparation for the changes to tax litigation in Santiago. The firm bought in four associates this year, one of whom is skilled in tax controversy. The firm provided ... [more]

Baker & McKenzie added a partner and an associate to the group this year. The firm's client list includes pharmaceutical company Pfizer, international financial and insurance organisation AIG, RR Donnelley a global, full-service provider of print and ... [more]

Claro y Cía added two new associates this year. The firm advised gold mining and exploration company Kinross Gold Corporation in its acquisition of Minera Santa Rosa SCM and was also involved in US retailer Wal-Mart Stores' tender for D&S. This was one ... [more]

EPT Tax Advisors is best known for its tax advice to wealthy individuals and small businesses. Founding partner Christian Blanche Reyes is well known in the market.

Espinosa, Porte & Canales, Abogados y Consultores is described as a "small, developing firm made up of former Ernst & Young professionals," by a market commentator. The firm is part of the Lataxnet meaning it has close ties with several leading law firms ... [more]

Guerrero Olivos Novoa Errázuriz added one associate to the tax group in March this year.

Noguera Larrain & Dulanto is building a tax group slowly. Arturo Garnham, formerly with Baker & McKenzie, leads the practice with the support of one other practitioner. The tax group is doing a lot of estate planning and private banking, enjoying providing ... [more]

See also

Chile
Latin America (Regional Rankings)

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