Renting out your property in Chile while living abroad: tax, leases and short-term rentals

Many Chileans who moved abroad, and many foreigners who bought in Chile, end up renting out their property: to a long-term tenant, or by the night to tourists through a platform. Both can be done from abroad, but the rules change. Income tax is different for someone who does not live in Chile, a furnished rental may attract VAT, and the building's bylaws may set conditions on short-term stays. This guide sets out what you should know before you sign the first lease.

Short answer: if you are neither domiciled nor resident in Chile, the rent you receive is subject to the 35% Additional Tax on the gross amount. Whoever pays you the rent must withhold it and pay it to the tax service (SII), and you must also report it every April. DFL 2 homes, up to two per person, are exempt. A furnished rental is subject to VAT, and when it is booked through a platform and the owner lives abroad, the platform is responsible for that VAT. In a condominium, the condominium bylaws may set rules for short-term rentals, so read them before you list the property.

Income tax when you do not live in Chile

Rent from a property located in Chile is Chilean source income, and it is taxed in Chile even if the owner lives in another country. For an individual who is neither domiciled nor resident in Chile, the applicable tax is the Additional Tax (impuesto adicional), at a rate of 35%.

The base is the actual rent stated in the lease, with no deduction for expenses: repairs, the broker's commission and condominium fees are not deducted. The only reduction the law provides for this case is property tax (contribuciones) actually paid, which may be deducted from the base in the annual return. And because rent from non-agricultural real estate earned by individuals is exempt from the First Category corporate tax, there is no credit to reduce the 35%.

You do not need to register a start of activities with the SII to report this income. What is mandatory is filing the annual income tax return in April for the previous year's rent, where the amounts withheld during the year are credited.

Who withholds the tax, and why it matters

The law requires any person or entity paying income subject to the Additional Tax to withhold it, without distinguishing between companies and individuals. In a lease, the payer is the tenant. The tenant must withhold 35% of the gross rent, pay it to the SII by the 12th of the following month, and also file a sworn statement on those payments.

Having a property manager who collects the rent and sends it on to you does not change this. In October 2026 the SII made clear that when the manager acts as the owner's agent, the party required to withhold is still the tenant, because the tenant is the one who legally pays the rent, not whoever remits the money abroad.

If the tenant does not withhold, the tenant is liable for the tax, but that does not let you off: the SII can also collect the tax from the person who received the income. A private tenant may not know about this obligation, so explain it before signing and put it in writing:

• that the agreed rent is a gross amount;
• that the tenant will withhold the Additional Tax and pay it on time;
• that the tenant will send you proof of payment of the withholding every month.

DFL 2 homes

Rent from homes that qualify under DFL 2, a decree that grants tax benefits to housing of limited size, is disregarded for the Additional Tax and exempt from category taxes. The benefit applies whether or not the owner is resident in Chile, and in that case there is nothing to withhold, report or pay on that rent.

The benefit has limits. It is available only to individuals, and for a maximum of two homes, new or used. If someone owns more, the benefit applies to the two acquired earliest. Since 2023 the limit applies whatever the date of purchase, and since 2020 inherited homes also count. The home must have a built area of up to 140 square meters and be used as housing.

Law 21,850, published on 17 October 2026, adds a new option from 1 January 2027: individuals who rent out DFL 2 homes from the third one onward, of up to 90 square meters and to unrelated persons, may opt for a 5% single tax on the gross rent. The law does not say expressly how this applies to someone living abroad, and the SII has not yet issued its final circular, so wait for that guidance before counting on it.

Furnished and short-term rentals: VAT

Renting an unfurnished property is exempt from VAT. Renting a furnished property is taxed at the standard rate of 19%. A property is considered furnished when it has what is needed to sleep and eat there, such as beds, a table, chairs, tableware, a refrigerator and a stove. To calculate the tax, the law allows a deduction from the rent equal to 11% a year of the fiscal appraisal, in proportion to the period rented.

Someone who rents furnished property sporadically can pay the VAT on the monthly tax form without issuing tax documents. Someone who does it on a regular basis must register a start of activities and issue receipts or invoices. A furnished rental of a DFL 2 home within the two-home limit is exempt from VAT.

An important rule changed for digital platforms. Since 25 October 2025, the platform operator has been a VAT taxpayer for the transaction it intermediates, as if it were a regular seller. When the owner is neither domiciled nor resident in Chile and has not registered activities in the country, the platform is always responsible for the VAT on the rental.

Short-term rent is still subject to the 35% Additional Tax. What has not been settled is who must withhold it when the payer is a tourist booking through a platform, because the SII has not ruled on that case. The safe course is to report it in April.

Condominium bylaws and short-term rentals

If the property is in a condominium, read the bylaws (reglamento de copropiedad) before you list it. Chile's condominium law requires the bylaws to ensure, through rules of conduct and penalties, that using units as temporary lodging or tourist accommodation does not disturb permanent residents or affect the use of common areas and services. The bylaws may also impose whatever limitations the owners see fit, provided they do not conflict with the legitimate exercise of other rights or with the law.

The regulation under that law allows those rules to limit the use of the pool, the gym and other common areas by short-term occupants, with capacity limits, opening hours or priority for residents, but it forbids arbitrary discrimination against them. For these purposes, permanent occupants are those who stay in the unit for at least 30 consecutive days.

Neither the law nor its regulation expressly allows or forbids a condominium to ban short-term rentals altogether. Under the previous law, Chile's Supreme Court (Rol 14.434-2021) found a breach of bylaws that set an exclusively residential use when units were being rented for less than 15 days through platforms. If your building's bylaws are out of date, or contain restrictions, find out before you take the first booking. We explain how bylaws are updated in our guide to condominium bylaws in Chile, and how penalties are applied in our guide to fines in condominiums.

SERNATUR and the municipal license

Chile's tourism law requires providers of tourist accommodation, defined as establishments that commercially provide lodging for at least one night, to register with SERNATUR's National Register of Tourism Service Providers. Failing to register carries a fine of 5 to 10 UTM (Chilean monthly tax units). Registration requires, among other documents, the tax file and the commercial license (patente) or proof of exemption.

What no rule settles expressly is whether a private individual renting out their own apartment by the night counts as a provider of tourist accommodation, or must pay for a municipal license. It depends on whether the activity is carried on commercially and on each municipality's view. If you rent out several units or provide services such as daily cleaning or breakfast, the prudent assumption is yes. If you only rent your own home now and then, ask the municipality where the property is located first.

Long-term rentals: the lease and Chile's tenancy law

Chile's urban tenancy law does not apply to furnished homes rented for seasons of no more than three months for rest or tourism. For long-term rentals, however, it is the governing law, and it has rules an owner living abroad should know:

• A written lease with signatures before a notary. Since the Devuélveme mi casa law, a written lease with signatures authorized by a notary is sufficient grounds for the fast-track (monitorio) procedure, in which a tenant in arrears has ten calendar days to pay or object and, failing that, eviction is ordered within ten days of the ruling becoming final. We explain it in our guide to the Devuélveme mi casa law.
• Notice to end the lease. In month-to-month or open-ended leases, the landlord can only end the lease through the courts or by notice served through a notary, with a period of two months plus one for each year of the tenancy, up to a maximum of six.
• Return of the property. The tenant keeps owing rent until the property is returned, and the tenant's rights under this law cannot be waived. When a tenant will not leave, the routes and their timelines are in our guide to evicting a tenant in Chile. And cutting off the utilities is not one of them.
• Indexation. If the rent is in pesos and adjusted for inflation (CPI), you can calculate it with our CPI adjustment calculator.

Managing from a distance

From abroad, the usual arrangement is to leave a person or a company in charge under a power of attorney that expressly authorizes them to lease the property, sign and terminate leases, collect rent, pay property tax and condominium fees, and represent you before the condominium's management. If you may ever need to go to court, the power should also allow them to hire lawyers and appear before the courts. Remember that even if the manager collects the rent, withholding the tax remains the tenant's job.

It is worth checking from time to time that everything is in order: that property tax is paid, that there are no court attachments and that whoever occupies the property is supposed to be there. We explain how in our guide to checking your Chilean property from abroad.

If you live in the United States or another treaty country

Double tax treaties generally allow the country where the property is located to tax the income from it. The treaty between Chile and the United States, in force since December 2023, allows Chile to tax rent with no cap on the rate. Its protocol adds an option: a U.S. resident may elect to be taxed in Chile on that income on a net basis, as if it were business profits of a permanent establishment. The election is binding for the year in which it is made and for the following years, unless the competent authority agrees to end it, so evaluate it before the first lease. We explain it in our guide to the U.S. and Chile tax treaty and your property.

If the property is held by a Chilean company, different rules apply, and the comparison is in our guide to owning Chilean property personally or through a company. To find out whether that company is in good standing, see our guide to checking a Chilean company and its property.

Frequently asked questions

Do I have to register a start of activities with the SII to rent out my property?

For income tax, no. For VAT, only if you rent furnished property on a regular basis. What you must do is report the rent every April.

Can I rent my apartment by the night on platforms such as Airbnb?

Yes, unless the condominium bylaws restrict it. The law requires the bylaws to set rules so that tourist accommodation does not disturb residents, and they may impose other reasonable limitations. Read them before you list.

What happens if my tenant does not withhold the tax?

The tenant is liable for the tax not withheld, but the SII can also collect it from you, and you must report the income regardless. That is why the withholding should be written into the lease.

My home is a DFL 2 home. Do I pay tax on the rent?

No, if you are an individual and the home is within the limit of two homes covered by the benefit. The exemption applies even if you live outside Chile.

Do I need a property manager?

The law does not require one, but from abroad it is hard to sign leases, take the property back and deal with problems without someone in Chile holding a sufficient power of attorney.

How we can help

At Terreno en Regla we draft leases with signatures before a notary, prepare the power of attorney for whoever manages your property, review the condominium bylaws before you rent short term and, if the tenant does not pay or will not leave, our civil litigation team takes it on. We can also check your property from abroad before you rent it out. Write to us with the location of the property and the type of rental you have in mind. You can find every way to reach us on our contact page.