By Centro de Conocimiento Tributario (Tax Knowledge Center) - CCT

In February of this year, a large fire large fire affected the communes of Viña del Mar, Quilpué and Villa Alemana affected the communes of Viña del Mar, Quilpué and Villa Alemana, in the Valparaíso region, leaving almost 8,200 homes destroyed and more than 21,000 people affected.

To address this situation, on Monday, July 1, Law No. 21,681 was published in the Official Gazette. Law No. 21.681, which creates the "Emergency Transitory Fund for Fires and establishes other measures for reconstruction", was published in the Official Gazette on Monday, July 1.which -as its name indicates- aims to to cover the expenses and needs caused by the emergency. caused by such emergency.

In this article we will tell you some details of the most important tax aspect of this law: the incorporation of a new transitory regime for the taxation of accumulated taxation of companies' accumulated profits, which will allow theThis will allow the State to have part of the economic resources necessary to finance the reconstruction.

What is ISRAI all about (and why is it called that)?

A decade ago, the 2014 Tax Reform (Law No. 20,780) established an -at that time novel- optional and transitory regime, which allowed taxpayers to tax in advance the balances accumulated in the Taxable Profits Fund (FUT). (FUT). The same was subsequently done by Law No. 21,210 on Tax Modernization (2020).

This regime, known as FUT substitute tax (or ISFUT), reappears in the year 2024 under the name of ISRAIThe profits to which it now refers are those accumulated in the companies or enterprises as of December 31, 2023, controlled in the registry of Income or amounts subject to global complementary or additional tax (RAI). (RAI).

Learn more about this record in the following video:

Which taxpayers can exercise this option?

Only first category taxpayers subject to the general tax regime are eligible for ISRAI. general tax regime (art. 14 letter A of the Income Tax Law) tax regime (art. 14 letter A of the Income Tax Law), or to the general Pro-SME regime (art. 14 letter A of the Income Tax Law), or to the general Pro-SME regime (art. 14 letter B of the Income Tax Law). general Pro-SME regime (art. 14 letter D No. 3 of the same law).

This option will allow companies or corporations to tax their untaxed profits -recorded in the RAI- with a substitute tax. substitute taxThis option will allow companies or corporations to tax their profits pending taxation -recorded in the RAI- with a substitute tax, replacing the final taxes of the owners (global complementary or additional) that would accrue upon receipt of such profits by way of withdrawal, remittance or distribution.

What is the rate of this tax?

The ISRAI provides for a fixed fixed ratealthough differentiated for each system: 12% in the general system and 30% in the general Pro-PYME.

This difference is due to the fact that the mechanics of determining the taxable income taxable income and the possibility of credit for first category tax, are different tax credit for first category tax, are different according to the tax regime to which the taxpayer is subject. to which the taxpayer is subject.

Hence the importance of to evaluate the convenience to opt or not to opt for this substitute tax, an option that -according to the provisions of the law- may be exercised until the last bank working day of the year. of January 2025..