Tax Opportunity: National Congress and SII Open the Door to a New Substitute Tax called ISIF.
On May 15, 2024, the National Congress approved a new Substitute Tax, designed to optimize the tax burden of taxpayers. With rates of 12% and 30% respectively, depending on the company's tax regime, this tax allows companies to regularize their accumulated profits under the framework of the Law that creates the Transitory Emergency Fund for Fires.
Important Update: Instructions from the SII for the New Substitute Tax
On August 1, 2024, the Internal Revenue Service (SII) issued Circular N°34 and Resolution N°76, providing the necessary guidelines for taxpayers of the Partially Integrated Regime and Propyme General to qualify for the Substitute Tax on Final Taxes (ISIF). This measure, in force until January 31, 2025, is a key opportunity for companies seeking to optimize their tax situation while contributing to the Fire Emergency Transitory Fund for the reconstruction of the Valparaíso Region.
Benefits of the New Substitute Tax
General Taxation Regime (Art. 14 A of the LIR): Companies under this regime may opt until January 2025 for a Substitute Tax of 12% on the balance of taxable profits accumulated as of December 31, 2023. This tax allows the regularization of profits without the right to credits from the SAC records.
2. Pro-SME General Regime (Art. 14 D of the LIR): Companies under this regime are eligible for ISIF at a rate of 30% on accumulated profits as of December 31, 2023, with the right to credits from the SAC records.
SII Instructions and Facilities for Taxpayers
The SII has deployed a series of tools and resources to facilitate the process of applying for this new tax:
- ISIF Calculator: Available on the SII web portal to determine the amount to be paid according to the tax regime of each taxpayer.
- Information Portal: A dedicated site with frequently asked questions, guides and everything necessary to understand the benefits of this tax.
Why Opt for the Substitute Tax?
- Tax Optimization: By taking advantage of this benefit, companies can regularize their accumulated profits, freeing up financial resources for reinvestment or distribution.
- Tax Compliance: The profits received will be considered fully taxed, allowing their withdrawal or distribution without additional charges.
- Social Contribution: The funds collected through this tax will be fully allocated to the Fire Emergency Transitory Fund, supporting the reconstruction of the affected areas.
Opportunity
Do not miss the opportunity to optimize your company's tax situation. The deadline to apply for the Substitute Tax is January 31, 2025. For more information and personalized advice, please contact us.
Source: www.sii.cl