Looking to hire in Chile

Chile provides statutory paid annual leave and sick leave protections. Employers should structure their leave policies to at least meet these minimums.

Employees in Chile must submit current-year expenses within 60 days of the expense date or within 30 days after returning from a business trip, whichever is later. Prior-year expenses must be submitted by February 1 of the following year, and expenses incurred in November and December must be submitted by the end of the fiscal year.

Some expenses, including certain travel and equipment costs, must be supported by a tax invoice issued with the employer’s information. To request invoices in the employer’s name, employees use an E-RUT issued by the employer, which is personal, non-transferable, and valid throughout employment. All expenses must be reviewed and approved by the employee’s manager, and expenses submitted without the necessary documentation will be taxed.

Phone and internet subscriptions and coworking fees can be reimbursed tax-free when properly documented. Employees should provide a tax invoice or receipt showing when and where the service was purchased and what it covers.

Work equipment and supplies such as laptops, office equipment and supplies, software subscriptions, and postal charges are reimbursed on a non-taxable basis when supported by a tax invoice or receipt that clearly identifies the purchase. Software subscriptions must also identify the employee.

Most business travel expenses are non-taxable when supported by appropriate tax invoices or receipts. For many travel items, tax invoices must show the employer’s name and tax ID, while receipts must show the employee’s name. Mileage without documentation is treated differently and becomes taxable as an allowance.

Everyday meals, groceries, and business meals with clients or partners can be reimbursed on a non-taxable basis when supported by a tax invoice or a receipt that is valid as a sales slip in Chile. For costs incurred in Chile, the documentation or claim description must clearly state what was purchased or the service provided.

Training, courses, books, and promotional items are treated as non-taxable when properly documented and linked to the employee. Gifts are treated differently depending on who receives them: gifts to clients are non-taxable, while gifts to the employee are taxable and treated as an allowance.

Bonuses in Chile include contractual and discretionary payments in addition to salary, such as incentives and commissions. These are taxed as regular income, with progressive tax rates and social security contributions withheld at source, so withholding in periods that include bonus payments may be higher.