Banking, Money and Taxes in Chile
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Although there are many good reasons for expats to relocate to Chile, ease of banking and convenient financial services are unlikely to feature on that list. Expats are warned that banking in Chile is a complicated and frustrating proposition at the best of times, and a bureaucratic nightmare at the worst.
Money in Chile
The currency used in Chile is the Chilean Peso (CLP), which is subdivided into 100 centavos. However, centavo coins are no longer in circulation and prices are often rounded up to the nearest peso.
Notes: 1,000 CLP, 2,000 CLP, 5,000 CLP, 10,000 CLP and 20,000 CLP
Coins: 1 CLP, 5 CLP, 10 CLP, 50 CLP, 100 CLP and 500 CLP
Banking in Chile
Along with the Banco Central de Chile, major Chilean banks include Banco de Chile, Banco Santander-Chile and BancoEstado. Of the foreign commercial banks, HSBC and Scotiabank have the largest presence in Chile, and it is possible for an expat to open an account with one of these before leaving home and then to open a linked local account after arriving in Chile.
Chilean banks are generally open from 9am to 2pm on weekdays.
Opening a bank account
Opening a local bank account in Chile is extremely difficult. Many banks will only allow expats to open a local account once they've had Chilean residency for two years, and even then it isn't a straightforward process. Many expats are hesitant to go through the bureaucratic processes involved with opening a local bank account in Chile, and prefer to rather look for alternative options.
Expats can usually have their salaries paid into their overseas bank accounts and access their money using foreign debit or credit cards. Expats who want to take this approach must ensure that they inform their bank of their intention to travel before leaving home and that they take at least two or three working ATM cards with them to Chile in case of loss or damage.
Credit cards and ATMs
ATMs are widely available, even in the smallest Chilean towns. These typically operate on a 24-hour basis and accept all major bank cards. Credit cards are also widely accepted throughout Chile.
Taxes in Chile
Expats will not usually be taxed on their worldwide income for the first three years they are residents in Chile. However, they will be taxed on the income they earn from Chilean sources on a progressive scale from zero to 40 percent.
After three years of residency in Chile, expats will be eligible to be taxed on their worldwide income. However, Chile has double-taxation avoidance agreements in place with many countries, so expats from these places will not be taxed on the same income twice.
Expats looking to retire in Chile will be relieved to know that foreign pensions of any amount are not taxed.
*Tax regulations are subject to change at short notice and expats are advised to seek the assistance and advice of a professional tax consultant.