Chile Tax Agency Issues Circulars on Tax Treatment of Life Insurance Savings, Inheritance Compensation

The Chilean Internal Revenue Service April 21 issued Circular Nos. 20 and 21, explaining the tax treatment of life insurance amounts accumulated as savings, or as inheritance compensation. The circulars include measures to: 1) define the scope of the life insurance compensation paid; 2) require the timely payment and mandatory declaration of taxes; 3) verify the tax payment before releasing insurance claims; 4) explain the tax treatment for partial, total, and third-party beneficiary claims; 5) impose taxes under various laws depending upon the domicile of the beneficiary; 6) explain the calculation of taxable income; 7) withhold a 15 percent tax ...