Chile: Guidance on obligation of digital service platforms to issue invoices; other tax developments

Obligation of digital service platform companies to issue electronic invoices from third parties

Guidance on obligation of digital service platforms

Article Posted date 20 December 2023

The Chilean tax authority provided instructions (effective 1 March 2024) on the obligation of digital service platform companies domiciled or resident in Chile that have independent workers to issue electronic invoices from third parties for the services provided by them to their users.

Such invoices must:

  • Include the legend “Service according to Law No. 21,431”
  • Specify the amount of the worker's remuneration
  • Be provided by the fifth day of each month for the services provided by the worker in the immediately preceding calendar month
  • Apply a provisional 17% withholding tax that must be reported to the tax authority through Form 1879

Read a December 2023 report (Spanish and English) [PDF 1.4 MB] prepared by the KPMG member firm in Chile

Other direct and indirect tax-related topics discussed in this report include:

  • Application of stamp tax to renewals or extensions of loans stated in electronic documents
  • Applicability of provisional withholding of corporate income tax on “movable income”
  • Value added tax (VAT) on collection management services and support activities carried out from abroad
  • Instructions on late submission of VAT returns online
  • Taxation of rental income from real estate located in the United States and use of taxes paid abroad as a credit
  • VAT on personnel provision services
  • Issuance of document to request reimbursement of expenses incurred in the contracting of international freight
  • Requirement to prudently exhaust collection means
  • Tax equity in the division of a company under the tax regime of small and medium-sized companies
  • Tax treatment of payments made by a Chilean company to a Colombian company for various services under the Chile-Colombia income tax treaty
  • Obligation to file Form 29 in the case of incomes not subject to VAT
  • Formula for calculating the initial balance of premiums available for redemption from the single investment account
  • Non-binding consultation on the application of the general anti-avoidance rule to a business reorganization
  • Deduction of payments for the transfer of lease contracts for real estate
  • Savings incentive requirements of letter E) of article 14
  • VAT on services provided by investment companies
  • Mandatory Provisional Payment (PPMO) rate modification from presumptive income and small and medium-sized companies tax regimes
  • Taxation for virtual assistance services provided from Argentina under the Chile-Argentina income tax treaty
  • Non-binding consultation on the application of the general anti-avoidance rule in the merger of a company with accumulated losses due to the absorption of companies with positive net income
  • Modification of Circular Letter No. 12 of 2021 that provides instructions on settlement in judicial processes of tax claims
  • Limitation on tax benefit under Law No. 18,156 regarding social security contributions for foreign technicians
  • VAT exemption regarding entities that replace Health Department in the provision of services
  • Export VAT refund

 

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 3712, 1801 K Street NW, Washington, DC 20006.