Chilean VAT returns

Once registered for value-added tax (VAT) in Chile, businesses must declare all taxable transactions and remit any VAT due to the Internal Revenue Service (Servicio de Impuestos Internos, SII).

VAT returns in Chile are filed on a monthly basis for all VAT-registered businesses on the full registration track.

• Monthly filing using Form 29 is the standard requirement for all businesses registered under the full registration track, regardless of size or turnover. Form 29 is a multipurpose tax declaration that covers VAT (output tax minus creditable input tax), provisional income tax payments, and payroll withholding tax in a single submission.

• Businesses registered under the Simplified Tax Regime — covering nonresident digital service providers and low-value goods sellers — may elect to file monthly or quarterly. The filing period is chosen at the time of registration and may be changed at the start of a new calendar year.

• Nil returns must be filed in any month where no taxable transactions have taken place. Filing obligations do not lapse during periods of inactivity.

The SII assigns the filing frequency at the time of VAT registration. Businesses on the full registration track cannot elect a different cycle.

VAT returns must be submitted by the 20th day of the month following the end of the reporting period.

• For monthly filers on the full registration track, the return covering each calendar month is due by the 20th of the following month.

• For quarterly filers under the Simplified Tax Regime, the return covering each calendar quarter is due by the 20th of the month following the quarter-end.

• If the 20th falls on a weekend or public holiday, the deadline moves to the next working day.

• VAT payments are due on the same date as the return filing deadline.

• There are no filing extensions available under Chilean VAT law — the 20th deadline is fixed and applies uniformly.

Chile uses Form 29 for full registration track filers, submitted electronically through the SII’s online portal. Businesses on the Simplified Tax Regime file a simplified declaration through the SII’s Digital VAT Portal, available in Spanish, English, and Portuguese.

A notable feature of Chile’s system is the SII’s pre-filled VAT return proposal (Propuesta de IVA), generated automatically from electronic invoice (DTE) data transmitted to the SII in real time. Full registration track taxpayers may review, modify, and confirm the SII’s pre-filled proposal within eight days of it being made available — after which, if no action is taken, the proposal is treated as accepted and the corresponding VAT liability falls due. Businesses whose actual transactions differ from the SII’s proposal must correct it before the deadline.

VAT-registered businesses in Chile must maintain comprehensive VAT records, including:

• E-invoices issued and received (DTE files), including sales invoices, purchase invoices, credit and debit notes, and export invoices — all stored in the SII-authenticated XML format

• Import documentation, including customs declarations and import VAT payment receipts

• Accounting records and journals supporting VAT calculations and the reconciliation between DTE data and Form 29 declarations

• Supporting documentation for input VAT deductions and adjustments

• Records of VAT credits carried forward and refund claims submitted

Under Chile’s Tax Code, accounting records and supporting tax documents must generally be retained for a minimum of six years and must be made available for SII inspection upon request.

VAT payments are due on the same date as the VAT return filing deadline — the 20th day of the month following the end of the reporting period. Late VAT payments are subject to:

• A restatement of the unpaid amount in line with the consumer price index (CPI) — the monetary correction (reajuste) that adjusts the tax debt for inflation from the due date to the payment date

• Interest of 1.5% per month (or fraction of a month) on the inflation-adjusted unpaid amount, accruing from the day after the deadline

• Additional administrative fines for repeated or wilful non-payment

Payments for full registration track filers are made via the SII portal’s integrated payment function or through BancoEstado and other authorised financial institutions. Businesses on the Simplified Tax Regime may pay in Chilean pesos (CLP), US dollars (USD), or euros (EUR) through the Digital VAT Portal.

Input VAT (fiscal credit) may generally be deducted from output VAT (fiscal debit) by businesses on the full registration track, provided the input VAT is supported by a valid electronic invoice and is attributable to taxable activities. Deductible input VAT includes:

• Goods purchased for resale or used in taxable production or trading activities

• Capital assets, fixed assets, and business equipment used in taxable activities

• Professional services, utilities, and overhead costs directly related to taxable activities

• Import VAT paid at customs clearance on goods used in taxable activities, supported by the customs declaration

• VAT on construction services and materials used in taxable real estate activities, subject to conditions

Input VAT is not deductible on:

• Goods or services used for VAT-exempt activities

• Goods or services used for personal consumption or non-business purposes

• Entertainment and hospitality expenses, unless directly related to taxable business activities

• Purchases not supported by a valid electronic invoice registered with the SII

• Goods subject to special consumption taxes where the VAT credit is explicitly excluded

Businesses registered under the Simplified Tax Regime cannot claim any input VAT credits. For mixed-use businesses with both taxable and exempt activities, a pro rata apportionment applies based on the ratio of taxable revenue to total revenue.

All Chilean VAT returns on the full registration track must be submitted electronically through the SII’s online portal using the taxpayer’s RUT and digital credentials (Clave Tributaria or electronic certificate). In-person filing is not available for the vast majority of taxpayers — electronic filing is mandatory.

VAT payments are made via the SII portal’s integrated payment function, through BancoEstado’s online banking system, or at authorised financial institution branches using the taxpayer’s RUT as the payment reference. Businesses on the Simplified Tax Regime pay through the Digital VAT Portal in their elected currency.

Penalties may apply for VAT noncompliance under Chile’s Tax Code, including:

• Late filing fines — a fixed fine of one tax unit (UTM) per month or fraction of a month of delay, up to a maximum of 20 UTMs per return; fines may be reduced by up to 50% where the taxpayer self-corrects before an SII audit or formal notification

• Inflation restatement (readjusted) — the unpaid tax amount is restated in line with the CPI from the due date to the payment date, increasing the nominal amount owed

• Late payment interest — 1.5% per month (or fraction of a month) on the CPI-adjusted unpaid tax, accruing from the day after the deadline

• Penalties for incorrect or false returns — fines ranging from 5% to 20% of the tax difference for negligent errors; up to 100% of the tax difference for deliberate underreporting

• Tax evasion penalties — fines of 50% to 300% of the evaded tax amount, plus potential criminal prosecution resulting in imprisonment, for wilful tax fraud, invoice manipulation, or systematic concealment of taxable revenue

• Financial institution withholding — where a nonresident business fails to register or comply under the Simplified Tax Regime, Chilean banks and card issuers may be required to withhold VAT on payments made to that supplier, as a backstop enforcement mechanism

The SII publishes guidance on applicable penalty rates and enforcement procedures, which may change over time.

If input VAT (fiscal credit) exceeds output VAT (fiscal debit) for a given reporting month, the resulting VAT credit balance may be:

• Carried forward to offset future VAT liabilities in subsequent months — this is the default treatment for most businesses. Accumulated fiscal credit balances may be carried forward indefinitely with no expiration period and are restated monthly in line with the CPI to preserve their real value.

• Refunded by the SII — available primarily for exporters and certain other qualifying taxpayers. Exporters may request a refund of accumulated input VAT attributable to export activities, subject to SII verification and the submission of supporting export documentation. Refund applications are reviewed by the SII, and processing times vary depending on the size of the claim and the taxpayer’s compliance history.

For businesses with mixed taxable and exempt activities, only the portion of excess input VAT attributable to taxable supplies is available for carry-forward or refund.