International Double Tax treaty between Chile and the United States kicks in
Franco Gorziglia,  November 29, 2023
On November 15, 2023, the Chilean Congress approved the agreement amending the International Double Taxation Agreement between Chile and the United States. Once it is enacted by the President of the Republic of Chile and the exchange of diplomatic notes takes place, it will successfully complete its processing, which was pending signature in February 2010.
Consequently, its entry into force is expected in the next few days, even though some of its benefits will be applied on the first day of the month following that date and, in its entirety, as of January 1, 2024.
What are the consequences of the application of the Agreement?
Double Taxation. As with other treaties on this matter, it implies a series of measures that seek to solve the problem of double taxation with respect to income that has its source in a State whose beneficiary is resident or domiciled in the other State, among which we can highlight:
Application of taxes in only one State. The payment for certain cross-border services or activities (business profits or benefits) could only be subject to income tax in the country of residence of the provider and not in the country from which they are paid.
Possibility of using as credit the taxes paid or withheld in the other State, even with respect to investments from a third country.
Limitation of rates to certain income:
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