When purchasing a property in Chile, one of the first strategic decisions investors face is whether to buy in their own name or through a legal entity such as a limited liability company (LLC). For foreign buyers, especially those acquiring assets valued at over $1 million, the decision goes far beyond convenience. It affects taxation, inheritance, and long-term asset protection in Chile.
At Becker Abogados, we advise international clients daily on the safe and efficient structuring of their investments. Whether their goal is to expand their portfolio, protect family assets, or plan for succession, an appropriate foreign investment structure is the foundation of a secure acquisition.
In this guide, we explain how the choice between personal and corporate ownership can affect your financial and legal results in Chile.
Asset Protection: Separating Your Personal Wealth from Your Investment
Protecting your assets begins with separating them. Buying under a personal name might be faster, but it exposes the global wealth to potential local liabilities. Specially if the property is used for rentals, wine production, or commercial purposes.
Why an LLC Provides a Shield
Acquiring real estate through a Limited Liability Company (LLC) grants you property in Chile through a separate legal entity. This separation limits your exposure in the event of disputes, debts, or third-party claims. For example, if a tenant files a lawsuit or an accident occurs on the property, the company (not an individual) assumes liability.
In high-value transactions, this protection becomes indispensable. For this reason, many of our clients, including investors purchasing vineyards or agricultural land, choose to establish a Sociedad de Responsabilidad Limitada (SpA) or Sociedad Limitada (Ltda.) (the Chilean equivalent of an LLC), to keep their assets safe and compliant.
Cross-Border Considerations
Using an entity also simplifies coordination with international tax jurisdictions. It allows investors to document capital injections clearly, maintain transparent accounting, and facilitate dividend distributions. All while keeping personal finances isolated. For those managing multiple global assets, this separation can prevent double taxation and simplify foreign reporting requirements.
Tax Implications for Foreigners: Which Structure Is More Efficient?
Taxes in Chile are predictable and transparent, but the structure you choose determines how much and when you pay. The differences between personal ownership and a corporate structure can significantly affect your bottom lines.
Buying Under a Personal Name
Individuals are subject to property income and capital gains tax. If you later sell the property, the gain may be taxed as income under the real estate tax Chile regime. While Chile offers certain exemptions for long-term ownership or primary residences, foreign investors often do not qualify for these benefits.
Additionally, if you rent your property, rental income is taxed at the standard progressive personal income rate, potentially up to 35 %. This approach can quickly become inefficient for investors with large or multiple holdings.
Buying Through a Chilean LLC
A foreign investment structure using an LLC offers greater flexibility. The company is taxed at a flat corporate rate (currently around 27 %), and dividends distributed to foreign shareholders are subject to a 35 % withholding tax, partially creditable depending on the investor’s home country tax treaty.
However, LLCs enable better expense deductions (maintenance, management, depreciation…) and streamlined accounting for multiple properties or commercial operations such as vineyards or boutique hotels. The result is greater control over timing and optimization of your taxable income.
Professional Guidance for Maximum Efficiency
At Becker Abogados, we work alongside local tax accountants to align each structure with both Chilean and international rules. We help our clients to obtain RUT (Tax ID Number), register their entities, and set up transparent reporting systems to stay fully compliant, avoiding unexpected tax exposure in Chile or abroad.
Flexibility and Estate Planning: Long-Term Advantages of Using a Legal Entity
For many of our clients, the goal is not just to buy property, it’s to preserve and pass it on. A well-structured company provides continuity and control that personal ownership simply cannot match.
Succession and Inheritance Efficiency
When property is owned personally, inheritance procedures in Chile can be lengthy and complex, involving probate court, valuations, and potential estate taxes. Transferring ownership through an LLC, on the other hand, is as simple as assigning company shares.
This method allows families to designate heirs or business partners without triggering additional transfer taxes or notarial processes.
Adaptability for Expansion
An entity structure also facilitates future growth. Investors can acquire additional properties under the same company, invite partners, or restructure ownership for financing or asset management purposes.
This flexibility is essential for those planning to diversify investments or establish a presence in Chile’s agricultural or tourism industries.
Privacy and Control
Buying through a company also provides a degree of discretion. While real estate ownership records are public in Chile, company shareholder data is not as easily accessible.
For high-net-worth individuals, this privacy, combined with clear corporate governance, creates an ideal balance between compliance and confidentiality.
Your Structure Determines Your Security
Choosing the right ownership structure is one of the most important financial decisions you’ll make as a foreign investor in Chile. Whether it’s a vineyard, luxury residence, or development project, the form of ownership determines how well your investment is protected, taxed, and transferred in the future.
Becker Abogados provides the clarity and execution needed to turn complex cross-border transactions into secure, efficient investments. We don’t just close deals, we design legal strategies that protect your wealth for generations.
The right legal structure is crucial for your investment’s future. Ask us about the best legal vehicle for your specific goals.
