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Chile’s Business Environment

As one of Latin America’s strongest economies, Chile has lots of opportunities for foreign investors and expats. Read our guide to find out all about working in Chile, from how to go about the job search to business etiquette and taxation.
Respecting hierarchies and establishing a certain level of trust is essential when doing business in Chile.

Speaking Spanish in the Workplace

Many Chilean business people have at least a basic command of English, particularly in bigger international companies. However, managers and employees of medium-sized and small companies often don’t speak English at all, making learning Spanish essential prior to your move. It will also significantly improve your relationship with your business partners.

Hierarchies and honor play an important role in Chile’s business world. Make sure to never voice your criticism openly or embarrass anyone in public. It is important to always address your business partners with their last name and their title. Always use the formal “Usted” (you), especially when speaking to those in management positions.

Taxation in Chile

Expats in Chile, who are considered residents and have a domicile in the country, have to pay income tax. This is the case whether they receive their paycheck from domestic or foreign sources.

Non-residents, on the other hand, are only taxed on their Chilean income. This is also the case when you receive income from a company or a business deal undertaken in Chile. During the first three years of living in Chile, expats are only taxed on their Chilean income. This period can be extended in some cases.

In general, Chilean income tax follows three basic principles:

  • Income taxes are paid by individuals or on behalf of individuals by the company they work for.
  • Taxes are based on all income received or accrued by a company during a tax period.
  • Business owners are only taxed on profits withdrawn from their company.

The local tax, which is placed on goods and services, is currently 19%. You may be subject to additional taxes while working in Chile. Contact the Chilean tax authorities for more information. Make sure to also talk to tax authorities in your home country to figure out if you can benefit from any double taxation agreements.

A Pioneer in the Field of Social Security

Following pressure from different workers’ organizations, Chile was one of the first countries in the Americas to implement a state-sponsored social security system. Reforms led to the creation of 35 different pension funds and about 150 social security schemes in the early 1970s. Eventually, the system was privatized, while further reforms took place in 2008. Mandatory contributions are equal to 10% of your monthly income. In general, your pension is not allowed to fall below 70% of your last month’s salary.

You are free to choose your pension-fund company. The age of retirement in Chile is 65 for men and 60 for women. As of 2012, pension law dictates that to be able to retire early, the balance built up must be equal to 70% of your average real wage over the preceding ten years and comprise at least 80% of the maximum welfare pension (PMAS). Because the change from the old to the new system was voluntary, many Chilean retirees are still part of the state-run social security system, called the Institute of Pension Fund Normalization (Instituto de Normalización Previsional — INP).

Currently Chileans are looking for further reforms to the pension system. Many workers struggle to be able to afford save enough for their retirement, resulting in lower pensions than in many other developed countries.


We do our best to keep this article up to date. However, we cannot guarantee that the information provided is always current or complete. 

Mathias Döringer

"Before moving to Santiago de Chile I joined the InterNations community and got useful hints regarding housing and business."

Emma Willems

"When I first came to Santiago de Chile I didn´t know one anyone. On InterNations I found many expat friends in the same situation."

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