Forming a company in Chile as a U.S. citizen to hold property

Many Americans who buy property in Chile are told, at some point, to "set up a company." Sometimes that is the right advice. Other times it is not, and the cost of getting it wrong shows up years later, when the property is sold or when the company has quietly fallen behind with the tax service. This guide explains how a Chilean company is formed from the United States, what it needs from you every year, and the one requirement worth knowing from the start: someone in Chile has to represent it.

Short answer: a U.S. citizen can own a Chilean company with no visa and no residency, usually a sociedad por acciones (SpA), which can have a single shareholder. You need a Chilean tax ID (RUT) first, the company can be formed through an attorney in fact without traveling, and it must file a tax return every year even if nothing happens. Its legal representative before the tax service must be Chilean or a foreign national with a Chilean residence permit, so a shareholder living in the U.S. cannot fill that role.

First, check that you actually need a company

Chilean law reserves two valuable benefits for individuals. The first is the allowance under which the first 8,000 UF of lifetime gain on the sale of real estate is not taxed, which applies to individuals wherever they live. The second is the set of DFL 2 housing benefits, which since Law 20,455 cannot be used by legal entities. A company has neither. It pays first category tax on the gain, and its shareholders are taxed again when the profits are distributed to them.

That is why, for a single property you plan to keep, owning it in your own name is usually the better answer. A company earns its keep for other reasons: several owners who need clear rules among themselves, several properties, an organized rental business, or an estate you want to plan during your lifetime. We compare both options in detail in holding Chilean property personally or through a company.

Why the SpA is the usual vehicle

The sociedad por acciones is regulated in articles 424 to 446 of the Commercial Code. It suits a foreign owner for three reasons. It can be created by a single person, so you do not need to find a second shareholder. Its name must end in "SpA" and its purpose is always treated as commercial. And no rule requires any of its shareholders to be Chilean or to live in Chile. A limited liability company (sociedad de responsabilidad limitada) is also possible, but it needs at least two partners and is less flexible when shares change hands.

Step 1: a RUT for each foreign shareholder

Before the company exists, each foreign shareholder needs a Chilean tax ID. The tax service (SII) processes it through an attorney in fact domiciled or resident in Chile, with your passport or a valid ID, the attorney's identification and a sufficient power of attorney. A power granted abroad must be translated into Spanish and apostilled or legalized, and the documents can be no more than a year old. The process is handled electronically. We explain it step by step in getting a Chilean RUT without traveling.

Step 2: the power of attorney you sign in the U.S.

The same power of attorney can authorize your representative to apply for your RUT and to sign the company's formation on your behalf. Law 20,659, which created the Registry of Companies and Partnerships, expressly allows signing through an attorney in fact, and it accepts a power granted by public deed or by a private document with signatures certified by a notary and then protocolized. When the power is granted abroad, the general rules on legalization or apostille apply.

From the United States there are two ways to sign it: at a Chilean consulate, or before a notary in your state with an apostille from that state's Secretary of State. Each route has its own uses, and the difference matters if the same power will later be used to buy or sell property. We cover both in signing a power of attorney in the U.S. for Chile.

Step 3: forming the company

Chile has two parallel routes, and an SpA can use either. The first is the Registry of Companies and Partnerships, often called "your company in a day." It works through an electronic form, it is public and free by law, and incorporation into it replaces registration in the Commercial Registry and publication in the Official Gazette. When the company is incorporated, the SII assigns its RUT automatically, and the start of activities can be requested on the same form.

The second is the traditional route: the company is formed by public deed, or by a private document with notarized signatures that is protocolized, and an abstract is registered in the Commercial Registry of the Real Estate Registrar and published once in the Official Gazette within sixty days. If that deadline is missed, the company is exposed to nullity, which can be cured but is better avoided. The traditional route takes longer and costs more, but it is sometimes preferred when the articles need to be tailored in detail.

The main differences between the two routes, side by side:

What to decide before signing

The articles of an SpA are flexible, which is an advantage only if someone thinks them through. Before we draft them, these are the points we settle with you:

• The name of the company, which must end in "SpA", and its purpose: buying, holding, renting and selling real estate, written broadly enough that the company can do what you plan without amending its articles later.
• The capital, the number of shares and how and when the shareholders pay for them, since the company will need funds to buy the property.
• Who administers the company and with which powers: whether the representative in Chile can sign alone, which acts need your written approval, and whether selling or mortgaging the property is reserved to the shareholders.
• If there are several owners, the rules among them: what happens if one wants to sell their shares, if one dies, or if they disagree on selling the property.

These decisions are what make the company useful years from now, when the person who knows the details may no longer be available. Articles copied from a generic template can work on day one and cause trouble the first time something changes.

Step 4: a legal representative in Chile

This is the requirement worth solving before the company is formed. Before the SII, the company's legal representative must be its manager, administrator or president, and a foreign national in that role must hold a residence permit that allows them to carry out activities in Chile. The Registry of Companies and Partnerships states the same condition: to represent a company you must be Chilean or a foreign national with a visa.

The practical result is simple. If you are not Chilean and you live in the United States, you can own all the shares, but you cannot be your company's legal representative before the tax service. Someone in Chile has to take that role. It should be someone you trust, with exactly the powers the company needs and nothing more, and with clear instructions on what they can sign without asking you.

Putting the property into the company

The simplest path is for the company to buy the property directly, in its own name. If you already own the property personally and want to move it into a company, that is not a mere formality: the law requires the contribution to follow the formalities of the asset, which for real estate means a public deed and registration with the Real Estate Registrar, and the transfer may have tax consequences. It is a decision to make before buying, not after.

What the company owes every year

A company is a taxpayer in its own right. It must file its annual income tax return every year, whether or not it had any activity, and it remains subject to its obligations until it formally gives notice of the end of its business. A company that simply stops filing does not disappear. The SII can close its tax registration on its own initiative, and the problem surfaces at the worst possible time, when you want to sell the property or move the money.

On taxes, the company pays first category tax on its profits: 27% in 2026 under the general regime. Law 21,850, published on October 17, 2026, lowers that rate to 25.5% in 2027, 24% in 2028 and 23% from 2029. A company that lives on rental income usually cannot use the Pro Pyme small business regime, because passive income, which includes rent, cannot exceed 35% of its revenue. When profits are distributed to you, the 35% Additional Tax applies, with a credit for the first category tax the company paid. How the tax treaty between Chile and the United States affects this is explained in the tax treaty and your Chilean property.

The property itself pays the annual property tax (contribuciones) like any other. On the U.S. side, owning shares in a foreign company may bring reporting obligations of its own; that question belongs with your U.S. tax adviser.

Frequently asked questions

Can I be the only shareholder?

Yes. An SpA can be formed and held by a single person, and no rule requires its shareholders to be Chilean or resident in Chile.

Can I be the company's legal representative from the U.S.?

As a U.S. citizen without Chilean residency, not before the tax service. The legal representative must be Chilean or a foreign national with a residence permit that allows them to carry out activities in Chile. You can still own the company and give precise instructions to the person who represents it.

Do I need to travel to Chile to set it up?

No. The company can be formed through an attorney in fact, with a power of attorney signed in the United States and apostilled or legalized, translated into Spanish where needed.

What happens if the company stops filing?

The SII can close its tax registration on its own initiative, and missing returns complicate any sale of the property or any transfer of funds. If that has already happened, the first step is a review of where the company stands; we explain how in our guide to checking a Chilean company and its property.

How we can help

At Terreno en Regla we form Chilean companies that hold property, obtain the RUT of the company and of its foreign shareholders, register the start of activities, can act as the company's representative in Chile and keep it up to date with powers, amendments, minutes and share transfers. You can see how we work on our page for property holding companies and on our page for clients in the United States. If the company is going to buy a property, we carry out the title study first, and if it already owns one, we can check it from abroad.