The Chilean tax authority (Servicio de Impuestos Internos - SII) has published Letter Ruling No. 778 of 25 March 2021 concerning the tax treatment of the purchase (licensing) of software from a company in the United States. In its analysis, the letter notes three main points:
- The making available of software is subject to VAT;
- Amounts paid for the right to use a computer program is subject to withholding (additional) tax, with an exemption where the rights are limited to the use of the progr…