How to Set Up a Company to Own Real Estate in Chile

Investing in real estate in Chile is one of the smartest decisions for those looking to diversify their assets or establish a base in Latin America. However, this process can be somewhat complex without the proper legal framework and support. One of the best options to ensure efficient and secure property management is set up company for real estate in Chile. In this article, we will explain how to carry out this process, highlighting the advantages and essential steps.

Why set up company for real estate in Chile?

Set up company for real estate in Chile is not only a strategic measure to protect your assets, but also a way to maximize your income. The Company formation for property Chile offers multiple benefits for both domestic and international investors. The most significant ones include:

• Tax efficiency: A company allows you to optimize tax payments, leveraging benefits unavailable to individuals.
• Legal security: Having a legal entity protects your assets against potential disputes or litigation.
• Ease of management: Managing multiple properties is much simpler through a company.
• Attraction for foreign investors: For those residing outside the country, a company facilitates administration and legal representation.

Legal security and operational transparency are essential aspects for those seeking long-term investments. Specialized advice becomes an indispensable resource to guarantee success.

At Becker Abogados, we have advised numerous clients throughout this process, ensuring that each step complies with local regulations and is tailored to the client’s needs.

Steps for the Company formation for property Chile

The process to create a real estate company in Chile can be divided into several stages. Below, we outline the fundamental steps:

1. Define the Type of Company 

There are different types of companies in Chile, but the most common for the real estate sector are:

• Sociedad por Acciones (SpA): Ideal for a single investor or a small group of partners. It offers flexibility in management and the possibility of incorporating new shareholders.
• Sociedad de Responsabilidad Limitada (SRL): Recommended for family groups or small businesses. It limits the partners’ liability to their contributed capital.

At Becker Abogados, we analyze your specific situation to recommend the most suitable structure.

1. Draft the Corporate Bylaws 

The bylaws are the document that determines how the company operates. They include information such as:

• Name of the company.
• Corporate purpose (the company’s main activity).
• Rights and obligations of the partners.

Our legal team drafts clear and comprehensive bylaws, ensuring compliance with all local regulations.

1. Register in the Commercial Registry 

This step is mandatory to formalize the company. It includes:

• Signing the public deed before a notary.
• Registering the company in the Commercial Registry.
• Publishing an extract in the Official Gazette.

1. Obtain the Tax Identification Number (RUT) 

The RUT is essential to operate legally in Chile. It allows the company to issue invoices, pay taxes, and carry out financial transactions.

1. Open a Business Bank Account 

A bank account in the company’s name is necessary to manage income and expenses related to real estate activities.

1. Comply with Local Regulations 

Depending on the property’s location, additional regulations may need to be met, such as municipal permits or specific registrations. At Becker Abogados, we handle these authorizations on your behalf.

1. Establish Accounting and Auditing Systems 

To ensure tax compliance and financial transparency, it is crucial to implement accounting systems that allow detailed control of income, expenses, and tax obligations. Our team can also assist you with internal audits to ensure everything is in order.

Fiscal and Legal Aspects to Consider

For the Company formation for property Chile, it is essential to comply with the country’s fiscal and legal regulations. Key points include:

• Tax obligations: Real estate companies must meet tax requirements such as VAT on property purchases and sales and income tax.
• Legal contracts: Drafting purchase or rental agreements must be precise and protect the company’s interests.
• Due diligence: Before acquiring a property, it is vital to conduct a thorough review to identify possible debts or legal issues.
• Procedures with the IRS: The Servicio de Impuestos Internos (SII) plays a key role in tax compliance.

Additionally, it is important to consider changes in tax regulations that may affect real estate investments. For instance, recent tax reforms have introduced benefits for companies promoting sustainable developments or contributing to economic growth in rural areas. Staying updated on these regulations is crucial to avoid unpleasant surprises.

At Becker Abogados, we offer a comprehensive service that covers all these aspects, ensuring that your investment is secure and profitable.

Keys to Choosing the Ideal Property

In addition to creating the company, selecting the right properties is essential to maximize the return on your investment. Here are some tips:

1. Strategic Location: Look for properties in high-demand areas such as urban centers, tourist zones, or areas with commercial development. Evaluate the growth projections of the area to ensure the investment appreciates over time.
2. Property Condition: Inspect the property to identify potential repairs or necessary improvements. Consider long-term maintenance costs.
3. Profitability Analysis: Calculate the expected return on your investment based on the purchase price, projected rental income, and associated costs. Ensure that income exceeds operating and tax expenses.
4. Local Regulations: Verify that the property complies with local regulations and is free of encumbrances or debts.

Investing in the right properties not only guarantees financial stability but also contributes to the sustained growth of your real estate portfolio. At Becker Abogados, we conduct a detailed analysis to ensure every investment is secure.

Advantages of Working with Becker Abogados

With over 10 years of experience in the Chilean legal market, Becker Abogados has established itself as a leader in advising international investors. Some of the advantages we offer include:

• Bilingual Team: Our lawyers speak English and are certified by the UK Embassy in Chile.
• Legal Representation via PoA: We handle all procedures on your behalf, eliminating the need for you to travel to Chile.
• Personalized Services: From property identification to company formation, we manage the entire process.
• Visa Advisory Services: We assist foreign investors in obtaining the necessary permits to operate in Chile.
• Ongoing Support: We are available to resolve any questions or issues, ensuring a smooth experience.
• Local Connections: We have a network of contacts in key institutions to expedite processes and ensure compliance with all regulations.

Frequently Asked Questions About Real Estate Company Formation in Chile

1. How long does set up company for real estate in Chile? Generally, the process takes between 2 and 4 weeks, depending on the complexity of the case.
2. Is it mandatory to travel to Chile to create a company? No, thanks to the Power of Attorney (PoA), we can legally represent you throughout the process.
3. What costs are involved in creating a real estate company? Costs vary depending on the type of company and the required services. At Becker Abogados, we offer personalized quotes.
4. Can multiple properties be managed under one company? Yes, one of the advantages of creating a company is that you can centralize the management of multiple properties, facilitating financial and operational control.
5. What additional tax benefits are available? Depending on the type of company and properties managed, you may access benefits such as deductions for infrastructure investments or tax exemptions in priority economic development zones.

Take the First Step Toward a Secure Investment

If you are interested in investing in real estate, set up company for real estate in Chile is the first step to guaranteeing your project’s success. At Becker Abogados, we have the knowledge and experience necessary to guide you through every stage of the process.

From the Company formation for property Chile to contract management and legal procedures, Becker Abogados is ready to assist you.