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Selling the shares of a Chilean company as a non resident: buyer withholding, tax cost, advance SII ruling and treaty relief

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Last verified: 2026-10-26 · Status: Changing

When a foreign owner sells shares or quotas of a Chilean company, the buyer must withhold Chilean tax from the price: 10 percent of the gross amount, or 35 percent of the gain if the gain can be determined. The seller can ask the SII to fix the gain in advance, and the SII must answer in 20 business days or the seller's figure stands, which lets the buyer withhold on the real gain instead of the price. Treaty residents can get reduced or no withholding with a residence certificate, but the buyer carries the tax if the paperwork is missing.

USD figures use the Central Bank exchange rate of CLP 986.58 per US dollar published in the Diario Oficial for 23 October 2026 (CNCI Chapter I, Title VII). UF and UTA values are the SII figures for October 2026 (UF 41,221.08 on 26 October; UTA CLP 865,812). Conversions are for orientation only.

Key facts

Provisional withholding on price paid to non resident seller of Chilean shares	10 %DL Nº 824, art. 74 Nº 4, as of 2026-10-26 · in force
Withholding on determinable gain of non resident seller of Chilean shares	35 %DL Nº 824, art. 74 Nº 4, as of 2026-10-26 · in force
SII deadline to determine the gain in advance (silence counts as acceptance)	20 business daysDL Nº 824, art. 74 Nº 4, as of 2026-10-26 · in force
Day of the following month by which withheld tax must be paid	12 day of monthDL Nº 824, art. 79, as of 2026-10-26 · in force
Annual non taxable result for individuals on shares, mining rights and bonds	10 UTADL Nº 824, art. 17 Nº 8 a) vi), as of 2026-10-26 · in force

The rule

1. Whoever pays a non resident for shares of a Chilean S.A. or SpA, or for quotas of a Chilean partnership or limited liability company, must withhold a provisional 10 percent of the total amount paid, with no deduction. If the taxable gain can be determined, the withholding is instead 35 percent of that gain. The withholding is credited against the seller's final taxes on the same income, any excess can be used against other annual taxes or refunded, and if the withholding settles the tax in full the seller is released from filing an annual return.
Cost to do it: 10 percent of the gross price, or 35 percent of the determinable gain, withheld by the buyer.
Example: Price CLP 4,932,900,000 and tax cost CLP 2,959,740,000: withholding on the CLP 1,973,160,000 gain is CLP 690,606,000; on the gross price it would be CLP 493,290,000. / Price US$5,000,000 and tax cost US$3,000,000: 35 percent of the US$2,000,000 gain is US$700,000, against US$500,000 at 10 percent of the price.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 74 Nº 4, paragraph on operations under art. 17 Nº 8 letters a), b), c), d), i) and m), 1974-12-31 official text · verified 2026-10-26

2. Before the withholding falls due, the seller may file a request with the SII, with an estimate of the gain and all supporting documents, so that the SII determines in advance the gain on which the buyer withholds. Filing suspends the withholding deadline until the SII decides. The SII must rule within 20 business days from the date the seller provides all the documents, which the SII office certifies; if it does not, the request is deemed accepted and the buyer withholds on the seller's figure. A gain so determined cannot be audited unless the documents were maliciously false, incomplete or wrong.
Cost to do it: No fee is set by law; adviser time to prepare the tax cost file and the valuation support.
Example: On a CLP 4,932,900,000 price, an SII determined gain of CLP 493,290,000 cuts the withholding from CLP 493,290,000 to CLP 172,651,500. / On a US$5,000,000 price the ruling matters most when the gain is small: with a US$500,000 gain, withholding drops from US$500,000 to US$175,000.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 74 Nº 4, paragraph on the advance determination of the gain, 1974-12-31 official text · verified 2026-10-26

3. The buyer must declare and pay the amounts withheld by the 12th day of the month after the month in which the price was paid, credited, remitted or made available to the seller.
Cost to do it: No fee; late payment triggers the general Tax Code interest and penalties.
Example: A price paid on 20 November 2026 with CLP 493,290,000 withheld must be paid to the Treasury by 12 December 2026. / US$500,000 withheld on a November closing is due by 12 December.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 79, 1974-12-31 official text · verified 2026-10-26

4. The buyer may skip the withholding only if it is shown, in the form the SII sets by resolution, that the seller has already declared and paid the taxes directly, that the amount is non taxable or exempt, or that the sale produced a loss. If none of these is reliably proven, the buyer is liable for the withholding, with a right to recover it from the non resident seller.
Cost to do it: Exposure for the buyer equal to the withholding that should have been made, plus interest and penalties.
Example: A buyer that pays CLP 4,932,900,000 without withholding and without proof of a loss is exposed for at least CLP 493,290,000. / On a US$5,000,000 price, the buyer's exposure is at least US$500,000.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 74 Nº 4, paragraph on cases where the withholding may be omitted, 1974-12-31 official text · verified 2026-10-26

5. Where the seller is resident in a country with a tax treaty in force with Chile and is entitled to its benefits, and the treaty gives the taxing right only to the residence country or a lower rate, the buyer may withhold nothing or withhold at the treaty rate if the seller hands over a residence certificate from the competent authority of the other country and declares, in the form the SII sets, that it has no permanent establishment in Chile to which the income is attributable and that it meets the treaty requirements. A residence certificate is presumed to cover the calendar year in which it is issued. If the SII later finds the treaty did not apply, the buyer is liable for the shortfall, with a right to recover it from the seller.
Cost to do it: Cost of obtaining a residence certificate in the seller's country; the Chilean side charges no fee.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 74 Nº 4, paragraph on treaty residents, 1974-12-31 official text · verified 2026-10-26

6. For the gain on shares or company quotas, the tax cost is the contribution or acquisition value, increased or decreased by later capital increases or decreases made by the seller, each adjusted by CPI from the month before the event to the month before the sale; the gain is the price less that tax cost. For individuals, losses on the same kind of assets in the same year can be deducted if reliably proven, and if the combined result on shares, mining rights and bonds in the year does not exceed 10 annual tax units (UTA) it is non taxable. For individuals selling to a related company, a relative, a related party under Tax Code art. 8 Nº 17 or the company's directors, managers or liquidators, the gain is taxed on an accrual basis and the 10 UTA exemption and the averaging over the years of ownership do not apply.
Cost to do it: No fee; the burden is documenting each capital movement with dates.
Example: 10 UTA at the October 2026 value is CLP 8,658,120; the threshold is measured at the UTA value at year end. / 10 UTA is about US$8,776 at October 2026 values.Decreto Ley Nº 824, Ley sobre Impuesto a la Renta, Art. 17 Nº 8 letter a) i), ii), iii) and vi), and the paragraphs following letter b), 1974-12-31 official text · verified 2026-10-26

7. When the price or value used to compute a tax differs notoriously from normal market values, the SII may appraise it, after a formal summons in which the taxpayer can submit a valuation report. Normal market values are those that unrelated parties would agree in comparable circumstances. The difference between the agreed price and the value set by the SII is taxed with the single tax of art. 21 first paragraph of the income tax law.
Cost to do it: Cost of an independent valuation report if the price is challenged.Decreto Ley Nº 830, Código Tributario, Art. 64, first to fifth paragraphs and final paragraph, 1974-12-31 official text · verified 2026-10-26

8. In an SpA, every share transfer must record the buyer's statement that it knows the legal rules for this company type, the bylaws and the protections they may or may not give shareholders. Leaving it out does not void the transfer but makes the seller liable for the resulting damage. In an S.A., a sale that puts all shares in one hand for more than 10 days in a row dissolves the company by law, while an SpA does not dissolve in that case unless its bylaws say so.
Cost to do it: No fee; drafting time in the share transfer.Código de Comercio; Ley Nº 18.046, Ley sobre Sociedades Anónimas, Código de Comercio art. 444 and art. 446; Ley Nº 18.046 art. 103 Nº 2, 1981-10-22 official text · verified 2026-10-26

Scenario	Base	Rate	Withholding US$	Withholding CLP
Gain not determinable	Gross price US$5,000,000	10%	500,000	493,290,000
Gain determinable, tax cost US$3,000,000	Gain US$2,000,000	35%	700,000	690,606,000
Gain determinable, tax cost US$4,500,000	Gain US$500,000	35%	175,000	172,651,500
Treaty resident with certificate and declaration, treaty gives Chile no taxing right	None	0%	0	0

Withholding on a direct sale of Chilean shares by a non resident (DL Nº 824 art. 74 Nº 4). Assumed price US$5,000,000; CLP at 986.58.

Worked example

A foreign company sells 100 percent of a Chilean SpA to a Chilean buyer for US$5,000,000 (CLP 4,932,900,000). Its documented tax cost, being the original contribution and a later capital increase adjusted by CPI, is US$4,500,000 (CLP 4,439,610,000).
Without an SII determination the buyer withholds 10 percent of the price, US$500,000 (CLP 493,290,000), and the seller recovers any excess over its final tax through the annual return (DL Nº 824 art. 74 Nº 4).
If the seller files for an advance determination and the SII accepts, or does not answer within 20 business days, a US$500,000 gain is fixed and the buyer withholds 35 percent of it, US$175,000 (CLP 172,651,500), paid by the 12th of the following month (art. 79).
If the seller is resident in a treaty country, the treaty may reduce or remove Chile's tax; the buyer applies it only against a residence certificate and the SII declaration. For an Argentine seller, the Chile Argentina treaty is listed by the SII among the treaties in force, and the Argentine side of the sale is covered in the Argentine guide.

Step by step

1. Build the tax cost file: contribution and acquisition documents, every capital increase and decrease with dates, and the CPI adjustment to the month before the sale (DL Nº 824 art. 17 Nº 8 a) i).
2. Decide whether to seek an advance SII determination of the gain; file it before the withholding falls due, with all documents, and obtain the office's certification of completeness (art. 74 Nº 4). Allow 20 business days from that certification.
3. If the seller relies on a treaty, obtain a current residence certificate and the SII form declaration before closing (art. 74 Nº 4).
4. In the share purchase agreement, set the withholding mechanics, the gross up or not, and who files; in an SpA, include the buyer's statement required by Código de Comercio art. 446.
5. At closing, the buyer withholds and pays by the 12th of the following month (art. 79) and gives the seller proof of payment for its annual return.
6. Remit the net proceeds abroad through a bank of the formal FX market and report as required by the FX Compendium.

Common traps

A buyer that pays in full without withholding and without proof that the seller paid, had a loss or was exempt is liable for the withholding (DL Nº 824 art. 74 Nº 4).
Treaty relief at source needs both the residence certificate and the SII declaration; if the treaty turns out not to apply, the buyer pays the shortfall (art. 74 Nº 4).
The 20 business day clock runs only from the SII's certification that all documents were delivered, not from the first filing (art. 74 Nº 4).
A price far from market value invites an SII appraisal and the art. 21 single tax on the difference (Código Tributario art. 64).
Buying all shares of an S.A. dissolves it by law after 10 days unless a second shareholder is kept; an SpA does not dissolve in that case unless its bylaws say so (Ley Nº 18.046 art. 103 Nº 2; Código de Comercio art. 444).
Individuals selling to related parties lose the 10 UTA exemption and the averaging option (DL Nº 824 art. 17 Nº 8).

Sources

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