CHILE Law and Practice Contributed by: Javier Cortés, Juan Pablo Márquez and Gonzalo Pérez, Cortés Del Río Tax & Legal
5.3 Blacklists and Non-Cooperative Jurisdictions
Banks and Financial Institutions Banks and financial institutions must report to the IRS the balance or value and the total amount of credits made to the current accounts of individuals or legal entities when the balance or total credits show a daily, weekly or monthly movement equal to or greater than 1,500 UF (approximately USD70,000), regardless of their legal nature. Transfer Pricing Documentation According to the transfer pricing provision, taxpayers engaged in transactions with foreign related parties are required to prepare transfer pricing documentation. Large multinational groups with annual consolidated revenues exceeding EUR750 million are required to prepare a country-by-country report (CbCR), a master file and a local file. Additionally, taxpayers engaged in transactions with related parties abroad must file Form 1907, which reports the nature, amounts and transfer pricing methods applied to cross-border related-party trans - actions. This form is due annually in June. Common Reporting Standard Chile has implemented the OECD Common Report - ing Standard (CRS) for the automatic exchange of financial account information, as from 2018. Under Resolution No 48 of 2018 of the IRS, Chilean financial institutions (banks, brokers, insurance companies and fund managers) are required to identify account hold - ers who are tax residents of foreign jurisdictions and report their account information to the Chilean IRS, which in turn exchanges this information with foreign tax authorities. 5.5 Role of Tax Authorities and Enforcement Measures The Chilean IRS is the primary tax authority responsi - ble for the administration, assessment and collection of direct and indirect taxes in Chile. The tax authority has broad powers under the Tax Code to request information; conduct audits and examinations of taxpayers’ books, accounts and records; and issue assessments where it determines that tax has been underpaid.
The Chilean IRS periodically issues a list of jurisdic - tions which are considered to have preferential tax regimes, mainly due to the fact that such jurisdictions have not implemented information exchange agree - ments with Chile or do not comply with the interna - tional standards of fiscal transparency of the Global Transparency Forum. As of 2025, approximately 102 jurisdictions were included on this list. The consequences of operating with entities in black - listed jurisdictions include: • the presumption that all income obtained by a CFC resident in a preferential tax regime is passive income, and therefore subject to taxes in Chile on an accrued basis; • certain royalty payments made to entities resident in preferential tax regimes are subject to a WHT overcharge; and • in the case of the indirect transfer provision, if the entity being disposed of (owner of Chilean assets) is resident in a preferential tax regime, capital gain is triggered in Chile regardless of the ownership percentage of the foreign entity being transferred. 5.4 Reporting Obligations and Disclosure Regimes General Reporting Obligations As a general rule, taxpayers have the obligation to declare their worldwide income on an annual basis through an annual income tax return. Additionally, taxpayers have an obligation to file sworn statements informing the Chilean IRS about certain transactions, such as: • loans with foreign related parties that indicate the local debtor is excessively indebted; • other transactions with foreign related parties; • disposal of real estate; • lease agreements with third parties; and • transactions carried out in a stock exchange, etc.
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