Chile Tax Agency Clarifies Additional Tax, VAT for Advertising Services Provided to Nonresident Parent Company

The Chilean Internal Revenue Service March 20 issued Official Letter No. 548, clarifying the application of additional tax and VAT for advertising services provided to a nonresident parent company. The taxpayer, a Chilean subsidiary of a UAE-based parent company, sought clarification on the application of addition tax and VAT for advertising services provided to the parent company. The Tax Agency clarified that: 1) payments for the provision of the advertising services may be exempt from additional tax, subject to specific conditions; 2) the services couldn’t be simultaneously classified as technical services if they qualified as advertising services; and 3) if ...