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.
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