INCORPORATING A COMPANY IN CHILE
Companies may choose between three different options:
About this given options, the client can freely choose among them. One of the few exceptions can be found in “regulated markets” such as Fund-managing companies, Banking Institutions or Charity Organizations. In this case one must act according to the specific law.
As stated, this option doesn’t create an independent company in Chile, but stablishes a subsidiary of a main, foreign entity. Therefore the first step of this procedure is to elaborate a public deed containing legal and financial information about the company, document that must be legalized according to Chilean laws and procedures. If the original language of those files is not Spanish, they must be translated by a consul-certified professional, and verified by the Ministry of Foreign Affairs.
The public deed must contain: Power of attorney directed to the agent responsible for the branch, by-laws of the main foreign entity, certificate of good-standing (also called certificate of existence) name, domicile, capital information and corporate purpose of the Chilean branch and Declaration of the foreign entity in which it recognizes to be governed by the Chilean legislation in every aspect, and a specific declaration regarding its consent to maintain enough assets to meet future obligations in Chile.
It’s important to add that regarding profits, there is no maximum or minimum percentage to be remitted abroad. Our legal system only requires that there is no tax obligation unpaid and that the agency has complied with foreign investment regulations.
If a foreign citizen wants to establish an autonomous Chilean Corporation he must obtain a “Foreign Investor ID” (explained below). Once obtained, and if he is not in Chile, he must also grant power of attorney to a Chilean citizen so he can act in his name, towards Chilean notary or Chilean electronic registration system. If the foreign citizen is in Chile, he is able to using its passport and “Foreign Investor ID”.
Corporations in Chile can be Publicly-held Corporations, Closely-held Corporations, Simplified Corporations, Limited Liabilty Companies, Individual Limited Companies and Collective Associations.
The most recommended corporations to make business in Chile are Publicly-held Corporations, Closely-held Corporations and Simplified Corporations. More detail about this options here.
Once the company has been incorporated, it has the obligation to complete the form “Start of business declaration” towards the IRS (Servicio de Impuestos Internos in Chile). This must be done in a period of two months since the company has started to generate taxable actions.
About this point, even thou there is no legal prohibition for foreigners to incorporate autonomous companies in Chile, the IRS demands that they have a Chilean legal representative able to act towards the IRS.
FOREIGN INVESTOR ID
It’s a numerical, individual code that identifies the foreign investor to the tax authority and other public services in Chile. Contrary to other permits, this institution doesn’t require the intention to remain the country. It only allows making business or perform contracts and agreements in Chile.
When obtained, it allows the investor to perform/engage contracts and agreements that are essential for business. Such as, buying or renting property, creating corporations or entering them as a partner and realization of bank operations amongst others. If you wish to entrepreneur in Chile, you must apply for it.
Yes, there are different and parallel institutions in which a specific solicitude doesn’t affect the other. In fact, the “foreign investor ID” is granted by the Chilean tax department (Servicio de Impuestos Internos) while permits are given by “Foreign and Immigration department”.
They also differ in how fast they can be obtained. You can apply and obtain the “foreign investor ID” immediately, yet your application for a Visa or permit can take somewhere between 6 and 10 months.
You must fulfill in a specific form acquired from the tax department. Along with the standard information (name, passport number, address, nationality, etc) there is a special requirement in this procedure. You must know a Chilean or a foreigner with a definitive permit which is willing to sign the form in order to be accountable for your information against the tax institution.
Yes, this procedure and its own requirements fit perfectly in the services we provide. If you already have a Chilean or foreigner with a “definitive permit” willing to sign for you against the tax department, we can coordinate the rest of the requirements online.
VISA, PERMITS AND NATIONALITY SYSTEM
It’s a permit, granted by the “Foreign and Migratory Chilean department”, to reside and realize certain activities in our country. It’s granted for different reasons, such as investment, family link with chilean citizen, work contract with Chilean company, Visa Mercosur, among others.
It’s a permit, granted by the “Foreign and Migratory Chilean department”, to reside for five years in the country, and to develop any activity not forbidden by the law. To obtain it, you must have previously applied for and been granted a temporary residence permit.
- Be older than 18 years, or 14 if authorized by parents or legal guardians.
- Have been a resident in Chile for 5 years.
- Have already being granted a “Definitive residence permit”
- Haven’t been condemned or processed by a criminal activity or felony.
- Proof of economic and financial solvency.