The Internal Revenue Service (SII) reported that there are currently 8,762,120 real estate property records in the country, corresponding to 6,951,933 owners. Of these, 100,000 own three or more DFL-2 properties, or have a second rental property that is not DFL-2. All of them must declare, but not necessarily pay taxes on that basis.

Read the article in La Tercera-Pulso.

At the end of 2022, the implementation of VAT on services sparked debate among specialists, business associations, and professional bodies, who requested that the government postpone its entry into force, as it would increase service costs. Now, the elimination of the tax exemption on rental income has triggered another discussion.

However, both measures were part of the law approved at the end of Sebastián Piñera’s second administration, which reduced various tax exemptions to ensure funding for the Universal Guaranteed Pension (PGU), and which have been gradually implemented.

In this case, under current legislation, any property owner receiving rental income is required to report the amount earned in the annual income tax return filed in April, except for individuals who own up to two DFL-2 residential properties (properties under 140 square meters).

According to the SII, in all other cases—companies, non-DFL-2 properties, or from the third DFL-2 property onward—taxpayers must comply with the obligation to declare, regardless of the acquisition date. This does not necessarily imply that taxes must be paid, as it depends on income level and other sources of income.

The SII detailed that there are currently 8,762,120 real estate records corresponding to 6,951,933 owners. Of these, approximately 100,000 meet the criteria described above. Not all of them will ultimately pay taxes, as the obligation depends on whether the property is actually rented. :contentReference[oaicite:0]{index=0}

The Deputy Director of Taxpayer Assistance, Patricio Muñoz, explained that “the key point is that those required to declare rental properties are higher-income individuals, either because they own multiple properties or because they hold properties for commercial purposes.”

This law also eliminated the exemption for all taxpayers who are not individuals. Therefore, starting with this Tax Filing Process, legal entities must also pay taxes on such income in all cases.

The SII also introduced modifications this year to Sworn Statement No. 1935 regarding leased real estate, aimed at updating reporting obligations related to agricultural and non-agricultural property rentals, expanding the scope of operations to be reported and enabling better control of income tax on rental activities.

Muñoz explained that “if a person fails to declare, they risk having their return flagged, being called into an audit process, and being subject to fines and interest, where applicable.” He also noted that the SII uses information from rental sworn statements, property registries, and income tax returns to identify non-compliance risks and develop targeted audit plans.

The new assistant under scrutiny

To facilitate this declaration process, the SII introduced a virtual real estate rental assistant. Its purpose is to support taxpayers, although opinions differ regarding its effectiveness.

Rodrigo Benítez, Partner at SW Chile, stated that “the downside of using this assistant is the amount of information required.” He explained that while it is manageable with available data, it becomes complex for investors with multiple properties. He added that the tool assumes a single tenant per property, which may not always be the case.

Raúl Gómez, Partner in Tax Consulting at CCL Auditores Consultores, offered a different perspective, stating that “it is a useful tool because it provides the SII with information it did not previously have.” However, he acknowledged that “from an operational standpoint, some issues have been observed,” particularly since this is the first year of implementation.

The SII, however, rejected claims of insufficient information, stating that guidance has been available on its website since February and reinforced through targeted emails. Carolina Saravia, Deputy Director of Audit at the SII, added that “the assistant gathers data from all available sources and allows taxpayers to comply easily, as it automatically performs the necessary calculations.”