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Chile: VAT rules for documentation, telephone recharge and intermediary-involved prepayments  

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The Chilean Internal Revenue Service published Letter No. 2500 which explained the VAT documents and disclosure requirements for telecommunication companies selling telephone recharges and prepayments either directly to final consumers or through an intermediary.

 

Topics that are discussed include:

 

  • Telecommunications services are subject to VAT and to the basic regulations on documentation.
  • If the business sold the services directly to the end users, it would be obligated to document, recharge, declare, and pay VAT in accordance with the general regulations.
  • Businesses are required to include the VAT associated with the additional values or marketing margins the intermediary would gain in selling to end customers on the invoices if the middleman sold the services.
  • If the business withheld the VAT in advance, the intermediary would not be obligated to send invoices when selling to end customers and
  • A simple service intermediary is required to submit annual income tax returns but is exempt from issuing the invoices.

 

 

Source: sii.cl

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