Chile Publishes Circular Providing Updated Guidance on Foreign Tax Credits

The Chilean tax authority (Servicio de Impuestos Internos - SII) has published Circular No. 31 of 19 May 2021, which provides updated guidance on the foreign tax credit offset rules considering changes introduced by Law No. 21.210 on the modernization of tax legislation. These changes are generally effective from 1 January 2020.

The Circular notes that one of the key changes introduced by the law is a new Article 41A of the Income Tax Law, providing a single rate of 35% to be used in determ…