The Internal Revenue Service (IRS) of Chile has published the last set of Circulars (Circular no. 40, 41, 42, 44, 48 and 49) along with instructions on the amendments introduced by the 2015 Simplification Law (Law 20,899) on 13th and 14th July 2016. Law 20,899 was published in February 2016 that simplifies the 2014 Tax Reform (Law No 20,780). Here, instructions in Circular 40 is related to the CFC rules incorporated into the Income Tax Law under Article 41G and instructions in Circular 41 is associated with the General Anti-Avoidance rules (GAAR) incorporated into the Tax Code. Circular 42 specifies the transaction, transactions or series thereof to which GAAR applies. Circular 44 describes about capital contributions, revalorization of tax equity, share premiums and stock dividends. Circular No. 48 summaries the changes to the foreign tax credit rules and are effective from 1st January 2017. And lastly, Circular 49 describes and gives guidelines on the application of the two new alternative income tax regimes that will become effective on 1st January 2017. Those regimes are the Attributed Regime and the Partially Integrated Regime.
Related Posts
Chile passes tax compliance bill with updated GAAR rules
On 10 April 2024, Chile's Chamber of Deputies passed the Tax Compliance Bill, which includes numerous tax measures aimed at improving tax compliance in Chile. The newly approved Bill also changes the Chilean tax code. The Senate must approve the
Read MoreChile: VAT from digital services exceeds USD 1 billion
On 5 February 2024, Chile’s tax authority (Servicio de Impuestos Internos - SII), in a release, declared that its VAT collections from registered digital service suppliers have exceeded USD 1 billion as of December 2023. In June 2020, Chile
Read MoreChile releases 8th catalog of tax schemes
On 27 December 2023, Chile’s tax authority declared it published the eighth version of the Catalog of Tax Schemes. The publication of this Catalog responds to the challenge of ensuring that each taxpayer understands compliance with their tax
Read MoreUS Treasury signs income tax treaty with Chile
On 19 December 2023, the U.S. Department of the Treasury announced the entry into force of a comprehensive income tax treaty between the United States and Chile. The Chile tax treaty is the first new comprehensive bilateral tax treaty signed by the
Read MoreChile signs EU Trade Agreement & approves DTA protocol with Brazil
On 13 December 2023, Chile became the first country in the Latin American region to conclude with the European Union EU an Advanced Framework Agreement and an Interim Trade Agreement to strengthen political cooperation and foster trade and
Read MoreChile: Digital platform operators must issue pay slips to freelancers
The Chilean tax authority has announced Resolution No. 132 of 20 November 2023, which outlines that digital platform operators must issue electronic third-party service provision pay slips to independent freelancers who provide services to users of
Read More