63 Taxpayers Account for $1.5 Trillion in Foreign Payments: Chilean Tax Authority Announces Audits for Potential Tax Compliance Issues

Original article: 63 contribuyentes concentran $1,5 billones en pagos desde el exterior: SII anuncia auditorías por posibles incumplimientos tributarios

The Chilean Internal Revenue Service (SII) has announced the initiation of special audits for 63 taxpayers who collectively account for approximately $1.5 trillion in payments received in foreign bank accounts. This decision follows an analysis of data received in 2024 via the international Common Reporting Standard (CRS), revealing that Chileans possess balances amounting to $28.2 trillion across 181,799 accounts abroad as of December 31, 2023, with annual payments totaling $16.5 trillion.

The information, received each September from nearly a hundred countries, has enabled the SII to pinpoint specific risk factors. Out of the 181,799 account holders, 586 represent 68% of total payments (equivalent to $11.2 trillion). Following a detailed review, the agency narrowed the list down to 123 high-risk taxpayers, ultimately selecting 63—who exhibit a greater risk of tax violations such as income underreporting or non-reporting—for thorough audit procedures.

This measure aims to verify whether these taxpayers should acknowledge foreign income and fulfill their tax obligations within Chile.

“As a Service, we utilize various sources of information to detect potential anomalies or alerts that, while not necessarily indicative of violations on their own, must be examined in conjunction with other data, such as taxpayer activity and involvement in corporations, among various patterns or attributes, to ascertain if there is indeed any type of underreporting, aggressive tax planning, or even tax evasion,” stated the Acting Director of the SII, Carolina Saravia, explaining the methodology used as cited in a press release from the agency.

She emphasized that each analysis process helps refine and streamline the list of taxpayers under review according to the institution’s compliance management model, which incorporates various tax risks. This is to focus auditing efforts on cases that pose the highest risks and consequences for revenue collection, as well as to inform taxpayers embarking on foreign investments about their obligations.

Amounts and Destinations

Data indicate a sustained increase in balances and payments in foreign accounts over the last four years. Balances rose from $21 trillion in 2020 to $28.2 trillion in 2023, while payments (including income from interests, dividends, and redemptions) nearly doubled from $8.5 trillion to $16.5 trillion during the same period.

The primary destinations for Chilean resources, according to the reported balance, are traditional wealth management jurisdictions and financial centers. Switzerland tops the list with a balance of $7.952 trillion, followed by Luxembourg ($7.209 trillion) and the Cayman Islands ($3.187 trillion). Collectively, the top ten countries account for over $24.4 trillion of the total reported.

Regarding account holders, 75.7% of reported accounts belong to individuals, while 24.3% are legal entities.

Strengthening International Network

Chile has significantly expanded its data exchange tools. It can now share information with over 140 jurisdictions through various agreements, including double taxation treaties, information exchange agreements, and the Multilateral Convention on Mutual Administrative Assistance.

In addition to the CRS, the country implements Country-by-Country Reporting for transfer pricing, and since the 2021 tax year, sworn declarations 1950 and 1951 for greater accuracy in this area. Soon, a powerful new tool will be introduced: “Starting from the 2026 tax year, sworn declarations 1963 and 1964 will be in effect, mandating the submission of information about digital assets to comply with the new CARF (Crypto-Asset Reporting Framework) standard, which will facilitate the automatic exchange of information regarding crypto assets with other tax administrations,” detailed the SII.

The agency is also actively involved in international collaborative efforts, such as the OECD’s JITSIC Network, where intelligence and experiences regarding information leaks (Paradise Papers, Pandora Papers), high wealth individuals, and crypto assets are shared, thereby strengthening local risk analysis and enforcement strategies.

The message from the SII is clear: global financial transparency is now a reality, and the institution is leveraging technological tools and international agreements to ensure that foreign-source income is properly declared and taxed in Chile.

The selection of the 63 taxpayers marks the beginning of a more precise auditing process aimed at ensuring the accurate reporting of their national and foreign income in the country.