Crypto Tax Legislation & Law in Chile

The general rules apply. In this regard, for tax purposes, cryptocurrencies are understood to consist of deregulated digital or virtual assets, supported in a single digital registry called blockchain, in which there is no intermediation, and which is not controlled by a central issuer. The price of this asset is determined by supply and demand. As such, cryptocurrencies are not treated as legal tender or foreign currency in Chile, nor are they treated as foreign exchange transactions. Therefore, they are considered as assets, and are subject to capital gains tax under the general rules.

It is taxed under the general capital gains rules. The purchase of a cryptocurrency will entitle the purchaser to invoke the inflation-adjusted acquisition cost as a tax cost against the sale proceeds.

No, as the Chilean tax authority has expressly stated that cryptocurrencies are not treated as currencies, but as digital assets. Therefore, the Chilean tax authority has interpreted that neither bitcoin nor any other digital asset would be considered as legal tender or foreign currency.

The exchange of cryptocurrencies for other goods or services would most likely be treated as a barter agreement. The tax cost would be deducted at the level of the purchaser of the good or service. Capital gains tax could be triggered.

Individuals will be taxed on the sale of cryptocurrencies, and the applicable tax rate would range from 0-40%, as the general equivalence surcharge will be applied.

They start to qualify as a professional activity when they become an intermediation or brokerage service carried out through a platform with the aim of facilitating the signing of a contract between two parties. In this case, VAT applies in accordance with Chilean law, and a tax invoice or receipt subject to VAT must be issued accordingly.

In the case of individuals, losses made on crypto-assets may offset gains of crypto-assets. Losses from crypto-assets may also offset gains from the sale of other assets, such as stock or equity.

Companies subject to the general tax regime that sell crypto-assets may offset losses against all income for tax purposes.

In the case of individuals, in the year in which they are generated. In the case of companies, losses can be offset indefinitely.

Yes, the Chilean tax authority has interpreted Non-Fungible Tokens to be treated in the same way as cryptocurrencies. Additionally, stablecoins are also interpreted by the Chilean authority as another type of crypto-asset whose price is associated with the value of a legal tender, such as the US dollar.

The Chilean tax authority has understood the mining of cryptocurrencies as the process of validation of transactions and creation of new blocks in a blockchain, carried out through specialised computer equipment, resulting in an automatic reward, constituting a form of acquiring cryptocurrencies, an activity that can be carried out by a natural person or under the legal form that the taxpayer deems appropriate.

The tax treatment of the acquisition of cryptocurrencies through mining must be distinguished from that corresponding to the capital gain obtained after their sale.

With regard to the former, the acquisition of cryptocurrencies through mining constitutes a capital gain for the person carrying out this activity, considering that the use of assets predominates over the effort of the individual in the development of this activity, the income obtained is classified as capital income and not as labour income. For individuals, they will be subject to an income tax of 25%, which will constitute a credit against annual income taxes, which are levied at marginal rates ranging from 0 to 40%.

Companies subject to the general regime will be taxed at a rate of 27%.

Regarding the valuation of cryptocurrencies received for mining, the average market value in Chilean pesos of the cryptocurrency or fraction thereof received for mining on the day it was obtained must be considered. Such value will be subject to tax, after deduction of the expenses incurred to obtain it. If the sale is made by a company, for the purposes of determining the higher value, the cost will be determined using the FIFO method, although the taxpayer may choose to use the weighted average cost method instead. On the other hand, if the sale is made by individuals, the higher value will be subject to the final tax payment, and in this case, the acquisition cost will be duly adjusted.

As an example, disbursements for electricity, purchase of computer equipment, refrigeration systems, among others, may be deducted as a tax expense according to the Chilean tax authority.

New cryptocurrencies acquired as a return from holding cryptocurrencies previously acquired in a virtual wallet, or otherwise, will be considered as capital gains subject to a general rate of 25% for individuals, and 27% for legal entities subject to the general regime. This gain will be taxed on an accrual basis in most cases. Exemptions may also apply.

If the acquisition of cryptocurrencies via airdrop or staking has been obtained for free, the acquisition cost will be zero.

As indicated above, all income derived from cryptocurrencies will be subject to taxation under the general rules.

The Chilean tax authority has interpreted that for cryptocurrencies obtained for free through staking or airdrop operations that are subsequently sold, the income obtained will be subject to taxation under the general rules.

Yes, the filing of affidavits will apply.

Income generated from the sale or disposal of crypto-assets should be declared using Form 22. This form is used to file the annual income tax return for each tax year. It is important to clarify that this requirement does not apply if crypto-assets are held in a digital wallet, but only when income is generated (for individuals).

In addition, and in relation to the provisions of number 4 above, intermediaries of digital assets are required to file annually the sworn declaration form No. 1891 regarding ‘transactions of purchase and sale of shares in public limited companies, other securities and digital assets, and other transactions involving these securities, carried out through stockbrokers, securities agents, currency exchanges and other intermediary entities (...)’. Through this form, they must report the transactions of purchase and sale of digital assets carried out through their clients' accounts.

Donations of crypto-assets are generally not eligible for the tax advantages of donations.