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  How to Invest in Chile
 
   

Chile is this long and narrow piece of land located in the southern part of South America, between the Pacific Ocean and the Andes Mountains.  Its variety of climates and the beauty of its landscape, combined with a strong political and banking stability, make Chile an ideal place to think of business, retirement, forest preservation, or just some vacation and fun, especially if you are escaping from a busy stressful pace.

Chileans has opened doors and receives foreigners with kind attitude and helpful disposition.  However, there are several steps to consider at the moment of thinking of investing in real estate or moving in.

In the following lines, I will try to explain in a simple, but accurate way, the steps for the most common questions in the process to invest or move to Chile.

   
   

THE “RUT” NUMBER

Investing in lands in Chile is usually easy. Any one can buy, even without putting one step in Chile. The only necessary thing is to have a RUT number, which is the tax payer identification that shows a person as a part of the Chilean taxing system.  Its acquisition is free, and is needed for most of the possible activities to develop in Chile. To get one, the only thing needed is spending 5 minutes at the SII office (our tax office), and fill an application with personal information, such as full name, passport number, address, and email.  The number is generated immediately, and it is contained in a card that can be sent by regular mail within a month. In the meanwhile, a temporary official document is issue, showing the RUT number, with an expiration date (of the document, not the number) of 3 months. Having a RUT number means no further obligation, rather than paying generated taxes, if generated.

Now, the reason why a RUT number is needed to buy a piece of land comes from the fact that property owners pay “land taxes” (contribuciones). So, only members of the Chilean taxing community can be owners of a property.  However, these taxes are commonly very low (especially in rural areas, where sometimes it is equal to cero) and are usually not even considered in the calculations of the investments.

 

 
   

 

But if you are out of the country, the RUT number, just as anything in Chile, can be obtained through a power of attorney extended in any country that has a Chilean Consulate. So, if you are planning to invest in Chile, but right now you are in Canada, the States, or Middle East, you can just go to the nearest Consulate, sign the power and send it to Chile.  Here, it will have to go through the Ministry of Foreign Issues to be “legalized” (basically putting a stamp that recognizes the signature of the Consul), and then pass it through a notary to make it definitely valid and usable. After that, the attorney will be able to act in your behalf with as much freedom as the power shows.

BUYING PROPERTY

Buying a piece of land is usually easy and safe. Unlike other countries, we have offices, located in each city, that keep public records of each and every title deed that has ever existed on a property in its jurisdiction, called “Conservador de Bienes Raíces”. The records include owners, prices, boundary lines, surface and easements, mortgages, etc…, that could possible affect the property. Once you have found your dream property, before signing the contract, it is highly recommended to do a “Title Deed Report” (Estudio de Títulos) to make sure the property is free of leans. This research is normally done by a lawyer and should include at least, 10 years of the property’s history. In the meantime a certificate is extended by the Conservador de Bienes Raíces, called “Certificado de Hipotecas y Gravámenes”. Once the report is ready, the certificate is issued and no impediment has been found, then the property can be bought.

   
   

 

The process of buying is simple. A contract is written and signed in a notary, which will charge around 2 per thousand of the purchase price, plus other small charges. At this moment, the seller will have to present a tax certificate showing all land taxes paid up to day, otherwise the notary can not authorize a buying contract. The originals remain at the notary’s office, kept in a public record or archive that contains each and every contract signed at that notary. Legal copies of the contract (with the notary’s stamp on them) are given to both parties. At that point the property has been sold, but the process is not complete yet. The copies need to be inscribed at the Conservador de Bienes Raíces (who will also charge around 3 per thousand of the purchase price) to make them part of another public record, referred only to properties. This is the most important step in buying a property: once the contract is signed, the land has been sold, but the title deed will not be truly generated until it is inscribed in the Conservador de Bienes Raíces and become part of the public archive. So, it is highly recommended to inscribe the contract as soon as possible and ask the Conservador to extend a new certificate (certificado de hipotecas, gravámenes y prohibiciones) that shows there’s nothing unnoticed in the property. Having this is just as having insurance and the certificate makes the Conservador responsible for what he certifies.

To buy property, no VISA is needed; just the RUT number.

MONEY AND BANK ACCOUNTS

I usually call Chile “a full of stamp country”, meaning we are quite bureaucratic because for someone without at least a temporary residency, opening a bank account will show to be almost impossible, unless guided by someone with experience. Thus, opening one, if you are not living here, is kind of expensive, but possible. However, it does not allow the wiring of money from outside the country directly to the account. Foreign money enters Chile as “payment orders” given to a certain bank, in someone’s name. This person can be the same who wired the funds from outside, or someone in Chile, and only that person can take the funds from the bank. Once the order is paid, funds can be put in a bank account. As we have quite strict laws to avoid money laundry, the process involves a notification to the Central Bank, a document (just like a letter) explaining where the money comes from and what the money comes for, signed by the receptor of the money. Banking commissions move between 0,5% to 1,5% of the wired amount. The directions needed are the Chilean bank swift code, the bank’s office address and the name and RUT number of the person who will receive the transfer. No specific account number is needed, no matter what your banker says!

 
   
   

VISA

There are several kinds of VISA: tourist, temporary and definitive. The second one has several subtypes also, such as professional, employee and investor. An analysis of this issue is far too long to be part of this article, but some directions can be given.

Entering Chile as a tourist is as simple as it can be to enter any other country for such purpose. It usually requires a passport and some money to stay, and might include a temporary working permission that lasts 90 days as a maximum which is typically an artists choice. Depending on country and specific circumstances, it might need more or less formalities and requirements to fulfill, but it is usually not something to worry.

Staying is a little more complicated. A temporary VISA is needed in order to get a definitive one. There are basically 2 ways of going through the process.

The first one is to do it at your country’s Consulate. It might take around 4 to 6 months, and will possibly end with a 2 year VISA.

The other choice is to come to Chile and do it all here. It takes less time (around 2 months), but depending on the kind of VISA you are applying for, and the amount of paperwork involved for each one, it might be more or less complicated, because all foreign papers need to be officially translated, which involves time and money. This way ends with a one year temporary VISA. So, if you are not in a hurry, it might be better to do it from abroad, getting 2 year permission to get established.

The simpler VISAS are the professional and the employee ones. They do not need to show certain amount of income or assets. With a professional title and a job offer for professionals, or just a contract for employees is enough. The “offer” is a simple letter signed in a notary that “offers” working opportunity.  It is not a contract and is like a recommendation letter that has to say there’s a job that might be just offered if you arrive. The professional title has to be validated in Chile, unless some international agreement exists solving this issue.

The employee VISA means there’s a real job waiting. In such case, there’s little to do or worry if the contract fulfills the minimum Chilean salary. The VISA allows only working with the hiring person or entity. Once inside, that permission can be changed, and with the definitive VISA will be removed.

Investors VISA are much more complicated and require deeper explanation of the project, money to go on with it, and degree of success expected. Its nature exceeds this documents intention and is to be discussed directly with immigration.

Whatever the path chosen, temporary VISA allows to work and act just as any Chilean, and demands to apply and obtain a definitive one once expired in order to stay. To do so, you have to demonstrate the ability to sustain yourself without becoming a burden to the country, whether it is showed with a working contract, bills emitted, or whatever way there is to show income.

Having a temporary or definitive residency involves the generation of a RUN number, which is an identification number, used more widely than the RUT number. The RUN number is used as a RUT number for all taxing purposes and will replace the RUT number if any existed before.

Nicolás Gaete

Lawyer

 

 

   
 

 

Gral. Urrutia 699 - Of. 208 · Villarrica · IX Región · Chile · South America

Phone: 56 - 045 - 419040 / Mobile: 56 - 099 - 336 84 12

austral.propiedades2009@gmail.com

 

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