Chile Digital Nomad Visa

Local tax picture for Chile digital nomads

Chile is classified here with a territorial tax regime, which in practice means the focus is on Chilean‑source income rather than everything you earn worldwide. For a digital nomad on this visa, remote salary from a US or European employer, consulting income from foreign clients, ETF dividends paid into a foreign brokerage account, or rental income from property outside Chile are generally treated as foreign‑source. Under classic territorial logic, those foreign streams are not taxed locally while they remain foreign‑source, whereas any Chilean‑source income (which this visa does not allow you to earn) would be taxed at normal progressive rates. Because the visa explicitly requires 0% of income from local sources, most compliant holders sit squarely in the “foreign‑source only” bucket.

For FIRE readers, the capital gains question is crucial: if you sell index funds or ETFs in your US or other foreign brokerage, Chile’s territorial approach means those gains are usually treated as foreign‑source and, in that model, effectively exempt from Chilean tax so long as they remain foreign‑source and are not re‑characterized. That said, the exact treatment of foreign capital gains is not specified in the visa facts or program rules, and practice can depend on how Chile interprets tax residency and source; you should treat the exemption as a working assumption, not a guaranteed statutory carve‑out.

Tax residency is commonly triggered around the 183‑day presence threshold in many territorial systems, but for this visa the precise day count and mechanism are not specified in the provided facts. There is no explicit statement that the visa grant alone makes you a tax resident, nor that a separate registration is mandatory at a given deadline; the “Tax Status Deadline” is not specified. In practical terms, if you plan to live most of the year in Chile, assume you will be considered a tax resident and will need to register with the Servicio de Impuestos Internos (SII) and obtain a Chilean tax ID (RUT), even though the exact timelines and first‑year filing dates are not disclosed.

The tax treaty status with the US is listed as unknown in the visa facts, so you cannot rely on a named income tax treaty or totalization agreement as part of your planning based solely on this dataset. That means questions about whether a treaty reduces withholding on US dividends, covers Social Security, or coordinates pension taxation remain open and must be checked directly against the current Chile–US treaty texts and SSA totalization listings.

For US Citizens and Green Card Holders

US persons on the Chile Digital Nomad Visa remain fully subject to US worldwide taxation, regardless of Chile’s territorial rules. For earned income from remote work or self‑employment, the main tool is the Foreign Earned Income Exclusion (FEIE) on Form 2555, which can exclude up to 126,500 USD of earned income for 2024. Only salary, contractor payments, or business profits qualify; ETF dividends, capital gains, rental income, pensions, and Social Security are not covered. Because this visa grants a one‑year stay and can be renewed, both the Physical Presence Test (330 full days abroad in any 12‑month period) and the Bona Fide Residence Test could apply, but many nomads who move frequently will lean on the 330‑day physical test and count days in Chile and other foreign countries combined.

When Chile does not tax your foreign‑source income under its territorial logic, your local effective tax rate on that income is effectively 0%. In that situation, the Foreign Tax Credit on Form 1116 does not help with tax on salary, consulting income, or foreign investment income, because there are no Chilean income taxes to credit against your US liability. FTC becomes relevant only if Chile starts taxing some income—for example, if you later earn Chilean‑source income (which this visa forbids) or if Chile re‑characterizes part of your income as taxable locally despite its foreign origin.

FBAR (FinCEN Form 114) is required if the aggregate value of your non‑US financial accounts exceeds 10,000 USD at any point in the year, and this is separate from FATCA Form 8938. The visa facts say a local bank account is not required, but many long‑stay residents open one anyway; if you do, its highest annual balance counts toward the 10,000 USD threshold along with any foreign brokerage or fintech accounts. Non‑willful FBAR penalties start at 10,000 USD per violation, so tracking balances matters.

For a clean setup, you need two professionals: a US CPA who specializes in expat taxation to handle FEIE vs FTC strategy, Forms 2555 and 1116, and FBAR/FATCA; and a Chile‑based tax advisor to manage any RUT registration and local filings. The 1,500–3,000 USD spent in year one on this combined advice often pays for itself through avoided penalties, optimized exclusions, and early clarity on whether your foreign investment income remains outside Chile’s tax net.