Chile Tax Agency Clarifies VAT on Payment Collection, Dispersion Services

The Chilean Internal Revenue Service Aug. 31 issued Letter No. 2644, clarifying the VAT treatment of payment collection and dispersion services. A Chilean company that isn’t a bank or a bank transfer support company provides a payment solution platform that allows different payment transactions through bank transfers, cash, and credit card or debit card processing. The company sought clarification on the VAT treatment of those services. The tax agency clarified that: 1) the company qualifies as a business agency, since it provides not merely payment collection services but also offers features that facilitate its clients’ commercial relationships with customers, including ...