Taxes in Chile

Chile tax rates in 2026 at a glance

A cheat sheet of the rules in force in October 2026. Most thresholds in Chile are set in accounting units, not pesos: one monthly tax unit is $75 (72,151 pesos) in October 2026, one annual tax unit is 12 monthly units, $900 (865,812 pesos), and one inflation-indexed unit is $43 (41,114.54 pesos) on 7 October 2026. Peso amounts move every month; the rates do not. Amounts are in US dollars, with pesos or tax units in brackets.

The big story of 2026 is the tax package in President José Antonio Kast's National Reconstruction bill, No. 18.216-05. Congress gave final approval in August 2026 (on 12 August, after voting on the President's veto) and sent the bill to the Constitutional Court; according to the Senate, in 2026 it still awaited promulgation and publication in the official gazette. Many deadlines run from publication, so figures from the approved text are flagged. For 2026 itself the income tax, VAT and corporate rates do not change; most of the relief starts in 2027.

Compare taxes in 146 countries: relocation taxes 2026

Tax residency and the three-year break on foreign income

A resident is taxed on worldwide income, a non-resident only on Chilean-source income. There are two tests, and either one is enough.

The three-year rule for foreigners

Article 3 of the Income Tax Law gives a foreigner who becomes resident or domiciled in Chile a transition period: for the first three years counted from entry into the country, only Chilean-source income is taxed. The tax service extends the period in justified cases, at its own discretion. After that, worldwide income is taxed on the ordinary scale.

The common misreading is that the rule exempts any money paid from abroad. The law treats income from activities carried out in Chile as Chilean-source (article 10). If you physically sit in Santiago and work for a foreign employer or clients, that is Chilean-source income, taxable from day one. What the three years really shelter is passive foreign income: dividends from foreign companies, interest on accounts abroad, rent from a flat in another country, gains on foreign assets.

Tax residency and immigration status are separate: naturalisation counts years of legal residence, as the page on Chilean citizenship by naturalisation explains, and the 183-day test is explained in our article on tax residency.

Chile tax residency rules: counting days and foreign income

Chile makes you resident from day 184 in the country within any 12 consecutive months, counted as a rolling window rather than a calendar year. That is Article 8(8) of the Tax Code after the 2020 reform. The Chilean tax service, in Circular 63 of 2021, clarified that arrival and departure days count, while transit on a trip between two other countries does not.

Good news for newcomers: for the first three years from arrival a foreigner pays tax only on Chilean income, and in justified cases the tax service extends that period. The catch: after that, the scale of up to 40% covers worldwide income. Chile's tax holiday works like a gym membership: the free period ends just when everyone has forgotten about it. The calculator below shows when day 184 arrives.

Mistakes cost more: Chilean domicile survives your departure while your main business stays here, and the end of the tax holiday is easy to miss. Murblz support removes these risks: we count days, fix the start date of the relief, prepare the extension request and the residency certificate. We guarantee professional work and a transparent process, and in most cases a result on the first filing.

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Personal income tax: a scale from 0% to 40%

Chile has two personal income taxes that share one scale. The single second-category tax is withheld monthly by the employer from salaries. The global complementary tax is assessed once a year on all of a resident's income: fees, dividends, rent, interest and, after three years, foreign income. The top 40% rate has applied since 2020.

The rates are marginal, applying only to the slice of income inside each band. The tax service publishes a table with a factor and an amount to subtract, so the tax equals the base times the factor minus that amount. The annual scale of the global complementary tax is identical but expressed in annual tax units: the first $13,000 (13.5 annual tax units) are tax-free and 40% starts at $280,000 (310 annual tax units).

What reduces the bill

The payroll tax base is reduced by the employee's mandatory pension, health and unemployment contributions. There is no standard personal allowance; the zero band plays that role. Residents deduct mortgage interest on buying or building a home, up to $7,200 (8 annual tax units) a year, and the deduction disappears entirely once income exceeds $140,000 (150 annual tax units). Voluntary pension savings also carry tax incentives within limits set in inflation-indexed units.

With salary from a single employer no annual return is needed, since the tax is already withheld. With several employers or other income there is an annual reconciliation in April, and the top-up can be significant because combined income lands in a higher band. Spouses file separately, except couples under a community property regime.

Social security and take-home pay

Employees pay into a personal account with a private pension fund. Since 2025 a pension reform (Law 21.735) has been phasing in an employer contribution on a fixed schedule.

The reform contribution was 1% from August 2025, is 3.5% from August 2026, will be 4.25% from August 2027 and reaches 8.5% by August 2033. The 3.5% already includes disability and survivors' insurance, which used to be billed separately. The 2026 ceilings were set by the pensions regulator: $3,900 (90 inflation-indexed units) a month for pension, health and accident insurance, and $5,800 (135.2 inflation-indexed units) for unemployment insurance.

A foreign professional can be exempted from Chilean pension contributions under Law 18.156 if they are a professional or technician, belong to a foreign social security system and the employment contract says so expressly. Agree the wording before you sign.

Example: salaries of $2,600 (2,500,000 pesos) and $5,200 (5,000,000 pesos) in October 2026

Open-ended contract, the Modelo pension fund with a 0.58% fee, health cover through the public health fund, the inflation-indexed unit at 41,114.54 pesos on 7 October 2026, so the ceiling of 90 units is $3,900 (3,700,309 pesos). Table amounts are in pesos a month.

On $2,600 (2.5 million pesos) the employee gives up about 19.9% of gross pay, yet only 1.7% is tax; the rest is contributions to their pension account and health cover. At $5,200 (5 million pesos) the tax share rises to 5.2% while contributions hit the ceiling. Accident insurance in the example carries no risk surcharge.

Corporate tax and dividends

Companies pay the first-category tax. A company incorporated in Chile is resident and taxed on worldwide income. The choice of regime sets the owner's final burden.

The small business regime is open where average annual revenue over the last three years is below $3.2 million (75,000 inflation-indexed units), starting capital is below $3.7 million (85,000 inflation-indexed units) and passive income (from activities listed in the law) is no more than 35% of the total. The 12.5% rate of the general option was set by Law 21.755 for 2025-2027, conditional on the pension reform contribution schedule. It becomes 15% in 2028; from 2029, under the approved reform text, the separate small business rate is abolished and the general 23% rate applies. Monthly advance payments in this regime are halved for 2025-2027.

What the owner ends up paying

Under the general regime the company's tax is only partly creditable. On 100 pesos of profit the company pays 27; on distribution a resident owner in the top band is taxed at 40% on the full 100 but credits only 65% of the 27. The total comes to about 49%. For a non-resident from a country without a treaty it is about 44.45%, and for a non-resident from a treaty country 35%.

The 2026 reform: a 23% rate and full integration

The general-regime figures for 2027-2029 come from the National Reconstruction bill as approved by Congress; the small business schedule sits in a separate law, 21.755. The reform also phases back in the full credit of company tax for owners, meaning full integration, by the end of the decade. It adds a temporary 10% tax on profits accumulated in past years, a temporary regime for declaring foreign assets at 10% (7% if the money is brought to Chile and invested) and a tax stability regime for investments of $50 million or more.

Tax losses carry forward with no time limit. Companies pay a municipal licence fee of 0.25-0.5% of tax equity, subject to a cap, and expenses that cannot be substantiated or that benefit the owners attract a 40% penalty tax. To set up a company see company formation abroad, and for day-to-day payments you will need a business account in Chile.

The company will need a local account: we open a business account in Chile together with the registration.

VAT at 19%: what is taxed and how to file

The standard rate of VAT is 19%, and there are no reduced rates. There is no registration threshold either: anyone selling taxable goods or services registers with the tax service when starting activity.

Since 1 January 2023 VAT applies to services in general, not only to types listed in the law, so a company's consulting, marketing or information technology services are taxable. Services from individuals issuing electronic fee receipts, and from professional partnerships that opted for second-category treatment, remain outside VAT.

From 25 October 2025 purchases of up to $500 on foreign platforms such as AliExpress, Amazon, Temu and Shein carry VAT at checkout; previously goods up to $41 came in tax-free.

Under the approved reform, the first sale of a new home that obtained its final completion certificate before the law is published is exempt from VAT for 12 months, counted from the first business day of the second month after publication. The monthly VAT return (form F29) is due by the 12th of the following month, or by the 20th for electronic filers who file and pay online.

Freelancers, small business, tech and remote work

Electronic fee receipts: how freelancers pay

An independent professional in Chile invoices through electronic fee receipts. When the client is a company, it withholds part of the fee and pays it to the tax service. When the payer is a private individual or otherwise not a withholding agent, the professional makes the same advance payment themselves.

The schedule was set by Law 21.133 of 2019. The withholding is an advance, not the final tax. In April of the following year fees go into the global complementary tax; the withholding first covers the self-employed person's mandatory contributions (pension, health, accident insurance), calculated on 80% of annual fees, and the rest is credited against income tax. Expenses can be deducted as actually incurred or as a flat 30% of income, capped at $14,000 (15 annual tax units) a year. Modest earners get part of it back, and high earners pay the difference.

Example: a receipt for $1,100 (1,000,000 pesos) in 2026. The client withholds 15.25%, $160 (152,500 pesos), and the freelancer receives $880 (847,500 pesos).

Small business and information technology

For a small company the main choice is the general option of the small business regime at 12.5%, or the transparent option, where the company pays nothing and profit is taxed in the owners' hands. The transparent option pays off when the owner's personal rate is below 12.5%; the general option suits a business that reinvests. There is no special regime for information technology, but services that customs recognises as exports are VAT-exempt, and the 2026 reform introduces a tax credit of 15% of qualifying payroll costs for exports of knowledge-based services, up to 20% in the regions. It will apply once the law is published and the tax service issues guidance.

Start-Up Chile gives founders a grant and a visa, not a tax regime: the startup pays tax under the ordinary rules. More in our guide to the Start-Up Chile startup visa.

Remote work and digital nomads

Chile has no special tax regime for remote workers or digital nomads. As explained above, work you physically perform in Chile is Chilean-source income even when the employer is abroad. If a foreign employer does not withhold, the worker has to declare the income. Choose the structure before the move, not after the first letter from the tax service.

Property, cars, inheritance, capital gains and crypto

Property tax

The tax is charged on the assessed value set by the tax service, which is below market value, in four instalments: April, June, September and November.

Under the approved reform, owners aged 65 or over are fully exempt on their main home from 1 January of the year after the law is published (2027 if it is published in 2026). Chile has no transfer tax on purchases, though notary and registry costs apply, and a mortgage loan carries stamp duty of 0.066% per month of term, capped at 0.8%. Listings are collected in our investment property in Chile section.

Selling a home or shares

There is no separate capital gains tax; gains normally go into the global complementary tax, with key exceptions. An individual selling real estate pays no tax on gains up to $340,000 (8,000 inflation-indexed units) over their lifetime, cumulative across all sales, provided the conditions on holding period and sale to an unrelated party are met. Above that limit a flat 10% tax can be chosen instead of the scale. Gains on liquid listed shares of Chilean companies currently bear a flat 10% tax, which under the approved reform disappears from 1 January 2027.

Crypto

The tax service's position (ruling 963 of 2018): gains on selling bitcoin and other crypto assets are ordinary taxable income, so for a resident individual they end up on the scale of up to 40%. The share-sale reliefs do not apply, and there is no VAT. For other countries see our article on crypto and relocation.

Cars

The annual circulation permit fee goes to the municipality. For passenger cars the scale is progressive, based on the price in the tax service's annual list.

The minimum is $38 (half a monthly tax unit). At October 2026 values a car valued at $16,000 (15 million pesos) costs about $340 (320,100 pesos) a year. Passenger cars pay by 31 March, or in two equal instalments with the second in August.

Inheritance and gifts

Law 16.271 taxes what each heir receives rather than the whole estate.

A spouse, parents and children pay nothing on the first $45,000 (50 annual tax units) inherited, while gifts to them are exempt only up to $4,500 (5 annual tax units). For siblings and other relatives up to the fourth degree the rates rise by 20%, and for everyone else by 40%. The tax must be declared and paid within two years. Under the approved reform, gift tax on gifts to a spouse and children is cut by 50% for 12 months. Chile has no wealth tax and no exit tax. Complex estates are handled by Murblz specialists.

Non-residents and withholding taxes

A non-resident without a permanent establishment in Chile pays the additional tax, withheld by the Chilean payer at a base rate of 35%, with lower rates for some income.

A double tax treaty lowers these rates, but the recipient needs a certificate of tax residence before payment. A non-resident's income from Chilean property and from selling Chilean assets is taxed under the general rules, and even an indirect sale through a foreign holding company can trigger Chilean tax.

Related-party loans are subject to thin capitalisation rules: where debt exceeds equity by more than 3 to 1, interest on the excess bears an additional 35% tax at the borrower's level.

Double taxation and Chile's tax treaties

According to the tax service, Chile has 37 treaties in force: Argentina, Australia, Austria, Belgium, Brazil, Canada, China, Colombia, Croatia, the Czech Republic, Denmark, Ecuador, France, India, Ireland, Italy, Japan, Malaysia, Mexico, the Netherlands, New Zealand, Norway, Paraguay, Peru, Poland, Portugal, Russia, South Africa, South Korea, Spain, Sweden, Switzerland, Thailand, the United Arab Emirates, the United Kingdom, the United States and Uruguay. The treaty with the United States has been in force since 19 December 2023 and applies from 2024, and the protocol to the Brazil treaty applies from 2026. There are no treaties with Kazakhstan, Belarus, Ukraine, Armenia, Georgia, Turkey, Israel or Cyprus, and with Germany only on international transport.

The treaty with Russia, for example, was signed in Santiago on 19 November 2004 and has applied since 1 January 2013; according to Chile's Internal Revenue Service, it is in force as modified by the Multilateral Instrument, and Russia's 2023 suspension of treaty provisions with a number of Western countries does not cover Chile. Its protocol keeps the additional tax as long as first-category tax is fully creditable, so the combined burden on dividends is 35% rather than 5% or 10% on top, and dual residence is resolved in order: permanent home, centre of vital interests, habitual abode, nationality.

With countries that have no treaty, the foreign tax credit is limited to certain types of income, so double taxation is a real risk.

How to legally pay less tax in Chile in 2026

Chile taxes residents on a scale of up to 40%, and profit taken out of a company under the general regime at about 49%, but the law leaves newcomers and businesses several legal ways to pay less. Here are the six main ones in 2026.

1. Three years without tax on foreign income. A foreigner who becomes resident or domiciled in Chile pays tax only on Chilean-source income for the first three years from the date of entry, and the tax service extends this period in justified cases. The relief protects passive foreign income: dividends from foreign companies, interest on accounts abroad, rent from a flat in another country and gains on foreign assets. Selling foreign assets with large gains pays off precisely in these three years, before worldwide income falls under the scale of up to 40%.
2. The regime for small and medium-sized businesses. A company in this regime pays 12.5% instead of 27% in 2025-2027, the owners credit 100% of its tax, and monthly advance payments are halved. The regime is open if average annual revenue over three years is below 75,000 inflation-indexed units, about $3.2 million, and passive income is no more than 35%. It suits a business that reinvests its profit; if the owner's personal rate is below 12.5%, the transparent option is better, where the company pays no tax and the profit is taxed straight away at the owners.
3. Freelancer expenses and refunds of withholding. In 2026, 15.25% is withheld from every freelancer receipt, but this is an advance, not the final tax: in April it pays the contributions, calculated on 80% of annual fees, and the rest is credited against the tax. Expenses are counted as actually incurred or as a notional 30% of income, capped at 15 annual tax units, about $14,000, and with a modest income part of the withholding is refunded.
4. Mortgage and pension deductions. Mandatory contributions for pension, health and unemployment insurance reduce the base of the salary tax. A resident deducts mortgage interest on buying or building a home, up to 8 annual tax units, about $7,200, a year: in full with income of up to 90 such units, about $81,000, and partly up to 150, about $140,000, and voluntary pension savings give tax incentives within limits.
5. Selling property and shares, and inheritance. An individual pays no tax on gains from selling real estate within 8,000 inflation-indexed units, about $340,000, over a lifetime, cumulatively across all sales, if the conditions on the holding period and selling to an unrelated party are met, and on the amount above the limit chooses a single 10% tax instead of the scale. Gains on liquid shares of Chilean companies on the stock exchange are taxed at 10%, and under an approved reform they will no longer be taxed from 1 January 2027. A spouse, parents and children pay no tax on the first 50 annual tax units of an inheritance, $45,000 (43 million pesos), and Chile has no wealth tax and no exit tax.
6. Tax treaties. Chile's double tax treaties cap withholding tax on interest and royalties. A non-resident from a treaty country credits 100% of the company's tax and pays 35% on distributed profit, not about 44.45% as someone from a country without a treaty.

The source of income, the business form and how long you have lived in Chile decide which option pays off. Our manager calculates your tax burden and chooses a legal structure, and Murblz support sets it up: the company, the start date of the relief, residency certificates and tax returns.

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Filing, deadlines, penalties and what it means if you move

Late filing of a return that determines tax costs 10% of the tax if the delay is no more than 5 months, plus 2% for each further month, up to 30% in total (article 97 of the Tax Code). On top come inflation indexation and interest for each day of delay; since 2025 the tax service resets the rate every six months based on market rates.

The uncomfortable truth

The three years are not about remote work. Work you do while sitting in Chile is Chilean-source, so for a remote employee or a freelancer with foreign clients the break changes almost nothing.

After three years it is full taxation. Worldwide income is taxed on the scale of up to 40%. If you control a foreign company with passive income, Chile's controlled foreign company rules require you to include its profit before it is distributed. More on controlled foreign company filings.

Leaving does not automatically end residence. Domicile is not lost while the main seat of your business remains in Chile. There is no exit tax, but document the date you stop being resident.

The business burden stays high until at least 2029. The cut to 23% is phased, and distributed profit under the general regime still bears up to about 49%.

Your accounts are visible. Chile takes part in automatic exchange of financial information under the Common Reporting Standard, so a resident's foreign accounts do not stay hidden. See also personal accounts in Chile, and for company accounts our audit and reporting service.

For a comparison with a neighbour, see taxes in Paraguay. All programmes for the country are on the Chile page, rates by country are compared in taxes by country, and the practical side of the move is in our article on relocating to Chile.

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