Chile – Property Taxes

What taxes and fees apply when buying a property in Chile?

One of the first things any prospective purchaser should appreciate is that Chile imposes no dedicated property transfer tax on second-hand transactions between private parties. Chilean legislation simply does not provide for such a charge. This sets Chile apart from jurisdictions like Canada, where provincial land transfer taxes routinely add 1–2% to a purchase price, or the United Kingdom, where stamp duty land tax can climb as high as 12% on premium-priced homes.

The picture changes, however, when purchasing a brand-new property directly from a developer. Such transactions attract VAT at 19% on top of the agreed price. It is worth understanding that this VAT obligation falls on building companies and other entities whose business is the buying and selling of newly constructed properties — individual private sellers transferring real estate are not subject to VAT. In practical terms, developers typically build this cost into the advertised sale price of new-build units.

Where a mortgage is used to fund the purchase, a stamp duty (impuesto de timbres y estampillas) is levied on the loan documentation. This ranges from 0.2% to 0.8% on mortgage or financing contracts. For documents tied to a specific repayment period, the stamp tax is calculated at 0.066% per month or fraction thereof, subject to a ceiling of 0.8%. This charge is assessed on the amount borrowed rather than the full purchase price of the property.

Beyond any applicable VAT or stamp duty, buyers should set aside funds for notary fees (covering the drafting and authentication of the purchase deed), registration fees payable to the Conservador de Bienes Raíces (Chile’s land registry authority), and professional legal fees. By convention, the costs of notarisation and registration are borne by the buyer and are calculated with reference to the transaction value. Together, notary and registration charges typically come to around 0.5%–1% of the purchase price, though exact schedules vary between offices and you should request current fee tables from your notary or the relevant Conservador before exchange.

Real estate agent commissions in Chile generally run at 2%–3% of the purchase price. Depending on the transaction, this may be shared between the two parties or borne entirely by the seller — always confirm the arrangement in writing before proceeding. Engaging a locally qualified Chilean lawyer (abogado) to carry out title searches and review all contractual documentation is essential, especially for resale properties.

Worked example — resale apartment purchase, Santiago, CLP 150,000,000 (approx. USD 160,000):

All figures are approximate as of 2025. Always request itemised quotes from your notary, registrar, and lawyer in advance, and verify current fee schedules with the relevant official sources.

What taxes and fees apply when selling a property in Chile?

For a private individual selling a resale property, the direct tax exposure at the point of disposal is generally limited. Apart from any capital gains liability (covered in the following section), sellers do not face additional taxes on the transaction itself. The principal costs a seller will encounter are real estate agent commission and legal fees associated with preparing the deed of sale.

Estate agent (corredor de propiedades) fees are not regulated by law in Chile and are therefore open to negotiation, but in practice they typically fall in the range of 2%–3% of the sale price. Depending on how the transaction is structured, this commission may be shared with the buyer or borne solely by the seller. The arrangement should always be set out in writing before the property is listed.

VAT at 19% can, in specific circumstances, become payable by the seller. A transaction is classified as “habitual” — and consequently subject to VAT — when certain statutory conditions are satisfied. To avoid a sale being characterised as habitual, the seller should have rented the property out for a minimum of 12 complete months after acquisition before proceeding with the sale. This provision is aimed primarily at professional property traders and developers rather than ordinary homeowners or long-term investors; as a general principle, transfers of real estate are not subject to VAT.

Notary and deed preparation costs associated with the sale contract are ordinarily modest. By local convention these are frequently allocated to the buyer or shared between the parties. Your lawyer will also confirm that any mortgage or registered charge over the property is formally discharged at the time of completion.

Is capital gains tax payable on property sales in Chile?

Following the 2017 tax reform, capital gains realised on the sale of real estate became subject to taxation in Chile. This applies across all categories of property — land, houses, apartments, and commercial premises alike. Nonetheless, a substantial exemption means that the majority of ordinary sellers, and in particular long-term owner-occupiers, will face no liability in practice.

Properties acquired before 2004 are entirely exempt from capital gains tax. For those bought after that date, gains are taxed at a flat rate of 10%. The taxable gain is determined by deducting the original purchase price — adjusted for inflation using the Consumer Price Index (IPC) — from the sale proceeds. Individual taxpayers benefit from a cumulative lifetime exemption of 8,000 UF. At current 2025 values, 8,000 UF equates to approximately CLP 290–300 million or roughly USD 300,000–320,000 (always check the prevailing UF value with the Servicio de Impuestos Internos — SII). This allowance accumulates across all property disposals over a person’s entire lifetime rather than being a one-time entitlement.

Certain holding-period conditions also apply. A capital gain will be treated as non-taxable income provided that: the seller is a final taxpayer; the purchaser is not a related party; more than one year has elapsed between the date of acquisition and the date of disposal (or four years in the case of buildings sold by floors or apartments, or where land is subdivided); and the total gains realised over the taxpayer’s lifetime do not surpass 8,000 UF.

Where those conditions are met but the cumulative gain does exceed 8,000 UF, the amount above the threshold is subject to a surtax as a sole tax — applicable on either an accrued or cash basis, with an option to spread the liability over ten years — or alternatively a 10% sole and replacement tax assessed on a cash basis.

The rules are markedly less favourable for non-residents. While tax-resident individuals enjoy the 8,000 UF exemption, non-residents are liable to a 35% tax on the entire capital gain with no exemption available. Companies likewise cannot access the 8,000 UF exemption and instead pay corporate tax — currently 27% as of 2024 — on any real estate capital gains.

Practical example: A tax-resident individual purchased an apartment in Santiago in 2010 for CLP 80,000,000 (IPC-adjusted to, say, CLP 95,000,000 at the time of sale) and disposes of it in 2025 for CLP 200,000,000. The resulting gain of CLP 105,000,000 (approximately 2,900 UF) falls comfortably within the 8,000 UF lifetime exemption, and since the holding period exceeds one year, no CGT is due. If, however, this same seller had already drawn down 6,000 UF of their exemption through earlier property sales, only 2,000 UF of allowance would remain, and the portion of the current gain in excess of that balance would be taxed at 10% as a sole tax.

Always consult the SII or a qualified Chilean tax adviser to confirm your individual position, since the UF rate changes daily and the exemption calculation depends on personal circumstances.

Are there annual property taxes in Chile?

The main recurring levy is the Impuesto Territorial (Territorial Tax), more commonly referred to as Contribuciones de Bienes Raíces. This tax is levied annually on all real estate — urban, rural, and vacant land alike. It is broadly comparable in function to council tax in the United Kingdom or local rates in Australia, though unlike those systems, the Chilean charge is set at a national level rather than by individual municipalities. Revenue is collected centrally rather than by local authorities, producing a consistent framework that applies uniformly throughout Chile’s regions.

The tax base is the avalúo fiscal (fiscal assessed value), not the market price or the amount a purchaser paid. The Servicio de Impuestos Internos (SII) establishes these fiscal values by reference to factors including location, land area, construction area, build quality, available amenities, and periodic market comparisons. Crucially, the avalúo fiscal tends to represent roughly 50–70% of market value, meaning the real tax burden as a proportion of a property’s actual worth is lower than the headline rates imply.

The applicable rates as of 2025 are as follows. Residential properties are taxed at 1.2% on fiscal values up to CLP 56.8 million, with the portion above that threshold taxed at 1.4%. Non-residential urban properties attract a flat rate of 1.4%, while agricultural and rural land is taxed at 1.0% per year. A significant exemption reduces the liability for many homeowners: primary residences with fiscal values below CLP 56.8 million (as of 2025) are fully exempt from the annual charge. This threshold is reviewed semi-annually to account for inflation, providing ongoing relief to middle-income owner-occupiers.

For particularly high-value holdings, additional progressive surcharges apply. Properties with fiscal values in excess of approximately CLP 450 million attract supplementary charges ranging from 0.075% to 0.425% on the value exceeding that level, with effective combined rates potentially reaching 1.825% when these surcharges are included.

As of early 2026, annual contribuciones in Chile typically range from 0.5% to 1.4% of the fiscal assessed value, payable in four quarterly instalments due in April, June, September, and November. In practical terms, the annual liability can be zero for properties below the exemption threshold of approximately CLP 47,000,000 in fiscal value, rising to CLP 1,400,000 or more (approximately USD 1,400) per year for more valuable properties.

The SII formally reassesses property values every four years. These revaluation cycles allow fiscal values to be updated to reflect prevailing market conditions, inflationary trends, and neighbourhood improvements. Owners receive official notification when their assessed value changes and retain the right to challenge any assessment they consider inaccurate. You can look up your property’s current avalúo fiscal and associated contribuciones liability through the SII website, and payments are made via the Tesorería General de la República (TGR).

How is rental income from property taxed in Chile?

Rental income derived from Chilean real estate is subject to income tax and must be reported in the annual tax return (Form 22). This income is combined with a taxpayer’s other earnings and taxed according to Chile’s progressive income tax scale — an approach similar to the treatment of rental income in many comparable countries, with the crucial distinction that the tax treatment varies considerably depending on whether the owner is a Chilean tax resident or not.

Tax-resident landlords are permitted to deduct qualifying expenditure against their rental income, including mortgage interest, contribuciones, depreciation, maintenance and repair costs, and property management fees. These deductions can substantially reduce the amount of income that is ultimately taxable. After accounting for allowable expenses, the realistic effective tax rate for a typical resident landlord generally falls somewhere between 5% and 25%, depending on overall annual income and the thoroughness with which expenses are documented. Maintaining comprehensive and well-organised records of all property-related costs is therefore strongly advisable.

Non-resident landlords face a considerably more onerous regime. If you are not a Chilean tax resident, rental income is subject to a flat withholding tax of 35% on the gross amount received, with no deductions permitted. This represents a significant additional cost for overseas investors and underscores the importance of thorough tax planning before committing capital to a Chilean rental property.

VAT introduces a further layer of complexity for short-term and furnished lettings. Chilean VAT at 19% applies in certain real estate contexts, including rentals classified as “furnished.” A short-term Airbnb-style rental that includes services such as cleaning and linen provision will typically be treated as a furnished letting and therefore fall within the scope of VAT. By contrast, a straightforward unfurnished long-term tenancy between private parties is generally exempt. Operators of furnished short-term rentals may need to register with the SII for VAT purposes and issue monthly invoices accordingly.

Tax-resident landlords must submit their annual income tax declaration in April as part of the Operación Renta. For straightforward rental activity, a record of income and expenses is sufficient. Where the rental activity constitutes a habitual business, full accounting with electronic invoicing becomes mandatory. Non-residents earning rental income from Chilean property are also required to designate a local tax representative. Penalties for non-compliance are substantial: fines range from 10% to 30% of the unpaid tax, plus interest, and can in serious cases reach up to 200% of the amount due, with the possibility of criminal prosecution.

Does inheritance tax apply to property in Chile?

Chile does levy a tax on assets transferred at death. Known as the Impuesto a las Herencias, Asignaciones y Donaciones, this charge applies to property passing by way of inheritance and is governed by Law No. 16,271. Unlike jurisdictions such as Australia and Canada, which have eliminated inheritance tax entirely, Chile operates a progressive system under which the applicable rate depends on both the value of what is inherited and the closeness of the family relationship between deceased and heir.

Rates are progressive and can reach up to 25%, with the precise charge determined by the relationship between the parties and the value of the assets being transferred. Immediate family members — such as a surviving spouse, children, or parents — benefit from lower effective rates and more generous exemption thresholds than distant relatives or unrelated beneficiaries.

When real estate passes by inheritance, it is revalued for tax purposes at its market value at the date of succession. This revalued figure then becomes the base cost for calculating any future capital gain when the heir eventually sells. In practical terms, this means the CGT clock effectively resets on inherited property — an advantage for heirs, since they will only be liable on appreciation occurring after they acquired the asset by inheritance, rather than on gains accumulated from the original purchase price paid by the deceased.

The inheritance and gift tax rules apply equally to Chileans and foreigners alike, meaning non-resident foreign heirs are not exempt from liability. Chile has entered into double-taxation agreements with certain countries, which may influence the overall tax position in some cases. Before assuming any treaty relief is available, you should verify whether a relevant agreement exists between Chile and your country of residence or citizenship with the SII or a suitably qualified adviser.

Does gift tax apply to property transfers in Chile?

Chile taxes lifetime gifts of property under the same legislation that governs inheritance — the Impuesto a las Herencias, Asignaciones y Donaciones (Law No. 16,271). A gift of real estate made during the donor’s lifetime is treated in broadly the same way as a bequest on death, with the same progressive rates of up to 25% applying, scaled according to both the value transferred and the relationship between the parties involved.

As with inheritance, a closer family connection results in lower effective rates and more favourable exemption thresholds. Gifts between spouses, or from parent to child, are taxed at lower rates than transfers to more distant relatives or to unrelated recipients. The tax is calculated on the value of the property being gifted, which in practice means its market value at the time the transfer occurs.

Because the inheritance and gift tax rules apply equally to both Chileans and foreigners, the nationality or residency status of the donor or recipient makes no difference to how gift tax is assessed. That said, the transaction may interact with tax obligations in another country — for example, if the donor is also subject to tax in a different jurisdiction — making professional advice covering both legal systems strongly advisable before any property is transferred as a gift.

It is also important to bear in mind that gifting a property can carry capital gains consequences. The donor may be treated as having disposed of the asset at market value, potentially giving rise to a CGT liability if the gain exceeds whatever remains of their 8,000 UF lifetime exemption — applicable to tax-resident individuals only. Always seek specific guidance from a Chilean tax adviser and consult the SII before proceeding with a property gift.

Are there any tax advantages or incentives for buying property in Chile?

Chile provides a number of meaningful tax benefits to property owners, several of which are especially relevant to resident expatriates. The most significant of these is the mortgage interest deduction available to tax-resident individuals. Individuals who are resident in Chile may deduct interest paid on mortgage loans taken out to purchase or construct one or more dwellings, up to a ceiling of 8 annual tax units (UTAs). This is broadly analogous to mortgage interest relief that has historically been available in other countries and can materially reduce an owner-occupier’s annual income tax bill.

For tax-resident landlords, the ability to set property-related costs against rental income — as described in the rental income section — represents a further significant benefit. Claiming all available deductions, including an annual depreciation allowance of 3%, and maintaining thorough accounting records for property-related expenditure can substantially lower the effective tax rate on rental receipts.

The 8,000 UF lifetime CGT exemption available to individual tax residents is itself a major structural advantage of the Chilean system, effectively sheltering gains of approximately USD 300,000–320,000 (at 2025 UF values; check current figures with the SII) accumulated across a lifetime of property disposals. This is considerably more generous than, for instance, the principal private residence exemption in the United Kingdom — which is restricted to a taxpayer’s main home — or the equivalent provisions applicable in many European countries.

Chile does not currently impose a general wealth tax on real estate holdings, though higher-value properties attract a surcharge through the contribuciones system. Beyond that surcharge, individuals are not taxed on their net wealth or the total value of their assets, other than through the standard property tax linked to assessed value.

Investors weighing up a corporate holding structure should be aware that companies are excluded from the 8,000 UF capital gains exemption and are subject to corporate tax at 27%. Owning property personally as a tax-resident individual is therefore often more efficient from a tax perspective than holding it through a company, particularly for those whose investment strategy incorporates long-term capital appreciation.

Do different rules apply to foreign buyers or non-residents purchasing property in Chile?

Chile takes a notably open approach to foreign property ownership. The legal framework is well-developed and sets out clear rules for both domestic and international buyers. Whether the property in question is residential, commercial, or agricultural, the acquisition process involves formal documentation, registration, and compliance with national and local regulations. Overseas buyers are generally free to purchase property, though certain restrictions apply to specific categories of land — most commonly land situated in border zones and certain sensitive areas. The vast majority of urban residential and commercial real estate is freely accessible to foreign purchasers.

No additional transfer taxes or surcharges are levied solely because a buyer is a non-resident or foreign national at the point of purchase. The tax treatment of ongoing rental income and eventual capital gains, however, differs substantially according to whether the owner qualifies as a Chilean tax resident. Foreign nationals are taxed only on Chilean-source income during their first three years in Chile (with a further three-year extension available); after that period, worldwide income becomes subject to Chilean taxation.

Tax residence in Chile is established by being physically present in the country for more than six months in a single calendar year, or for more than six months in aggregate — whether consecutive or not — across two consecutive calendar years. This threshold, comparable to the 183-day test used in many other jurisdictions, determines whether an individual has access to the favourable resident tax rates on rental income and the 8,000 UF CGT exemption, or instead faces the flat 35% rates applicable to non-residents.

Non-resident property owners are also subject to specific administrative requirements. In addition to the flat 35% tax on gross rental income and the 35% rate on total capital gains, non-residents must appoint a tax representative (representante tributario) in Chile. This local representative manages tax filings and handles communications with the SII on behalf of the non-resident owner. It is also advisable — and in many cases necessary — to obtain a Chilean RUT number (tax identification number) and open a local bank account to facilitate payments and formal dealings with government authorities.

Non-resident buyers who require mortgage financing should be aware that access to Chilean mortgages may be more restricted and subject to more demanding requirements than for local borrowers. Chilean banks can be notably slow in processing mortgage-related paperwork, which is one reason many sellers in Chile prefer buyers who can transact in cash. If you are unable to be present in Chile throughout the purchase process, a power of attorney granted to a trusted Chilean lawyer can allow them to act on your behalf locally.

Always verify the current requirements applicable to your specific nationality and residency status with the SII, the Conservador de Bienes Raíces, and a locally qualified legal professional before committing to a purchase.

Frequently asked questions about property taxes in Chile

Do I need a Chilean RUT number to buy property in Chile?

Yes. A RUT (Rol Único Tributario) — Chile’s national tax identification number — is a prerequisite for registering a property purchase, meeting tax obligations, and opening a Chilean bank account. Foreign buyers can obtain one through the Servicio de Registro Civil e Identificación or, in certain circumstances, via a Chilean consulate abroad. Your lawyer can guide you through the process well in advance of your transaction completing.

Is there a stamp duty or transfer tax when buying a resale property in Chile?

Chilean law does not provide for any form of property transfer tax, so there is no equivalent of UK stamp duty land tax or Canadian provincial land transfer tax levied on a standard resale purchase between private individuals. Stamp duty is, however, payable on mortgage financing documentation, typically at a rate of up to 0.8% of the loan amount. Always verify current rates with the SII before finalising your budget.

Is the 8,000 UF capital gains exemption available to all property owners?

No. The 8,000 UF exemption is available exclusively to individual tax-resident sellers. Non-resident sellers face a 35% tax on the full capital gain with no exemption whatsoever. The exemption does not extend to corporate entities either. For eligible individuals, it functions as a cumulative lifetime allowance that can be drawn upon across multiple property sales throughout the course of a person’s life.

How often are property tax (contribuciones) payments due?

Contribuciones fall due in four quarterly instalments, payable in April, June, September, and November each year. Payments can be made through the Tesorería General de la República website or at authorised payment outlets. Before completing a property purchase, it is essential to confirm with the SII and TGR that the property carries no arrears, as outstanding contribuciones can transfer with ownership to the new buyer.

Does VAT apply when buying an apartment off-plan or from a developer?

Yes. Purchases of newly constructed properties made directly from a developer are subject to VAT at 19%. This charge does not apply to second-hand transactions between private parties. Where the purchase of a new-build includes both land and construction, VAT is typically levied on the construction component rather than on the land value. Confirm the precise VAT treatment with both the developer and your lawyer before signing any contract.

Are non-residents required to appoint a local tax representative in Chile?

Yes. Non-residents who own Chilean property and derive rental income from it, or who sell property and realise a capital gain, are obliged to designate a local tax representative (representante tributario) in Chile. This individual manages the non-resident’s tax filings and liaises with the SII on their behalf. Failure to appoint a representative when required can lead to penalties and other compliance consequences.

Does Chile have any double-taxation treaties that affect property income or gains?

Chile has concluded double-taxation agreements with a number of countries, and these treaties can affect how rental income or capital gains are taxed — particularly in terms of whether foreign tax credits can be claimed against Chilean tax paid, or vice versa. The scope of any relief available depends entirely on which country you are resident in and the specific terms of the relevant treaty. Confirm whether an applicable treaty exists and how it interacts with your circumstances by consulting the SII or a specialist cross-border tax adviser before drawing any conclusions about your overall tax exposure.

What happens to property taxes if I own multiple properties in Chile?

The contribuciones exemption for primary residences applies to whichever of your properties carries the lowest fiscal value in cases of multiple ownership — it does not automatically exempt every property you hold. Furthermore, portfolios with a combined fiscal value above approximately CLP 450 million (as of 2025) attract progressive surcharges on top of the standard contribuciones rate. These surcharges apply to properties exceeding approximately 670 UTA and range from 0.075% to 0.425% on the value above that threshold. Consult the SII directly for current thresholds and guidance on how they apply to your specific portfolio.