Law granting tax benefits for home purchases approved

Nov 10, 2023

The rule approved by the Senate last October 25 establishes an annual refundable credit of just over $1.000.000 for a period of 5 years.

In the current context of the housing crisis in our country, the Senate approved a law to address this situation by creating tax benefits to encourage the acquisition of new homes.

The tax subsidy in question consists of a refund of up to 16 UTM of income tax determined by individuals, which will be available to taxpayers of the global complementary tax and the single second category tax, for the tax years from 2024 to 2029. As it is an annual benefit, the amount of the tax subsidy could reach 80 UTM, a little more than $5.000.000 in total.

It is important to mention that those who acquire a home for housing purposes through a mortgage loan, with banks or financial institutions, will be able to access the credit, provided they meet the following requirements:

  • The home acquired must be built and with final reception as of the date of entry into force of the law, and it must be the first sale made thereon (exceptionally, homes that do not have final reception as of said date may be eligible for the benefit, provided that there is a promise of sale executed after October 16, 2023).
  • In addition, the purchase and sale must be entered into as of the date of entry into force of the law and the home acquired must be registered in the name of the beneficiary in the respective Real Estate Registry before October 1, 2024.

Currently, the Chilean Chamber of Construction estimates the available housing stock at more than 100.000, so this measure promoted by the government seeks to reduce this number and address the housing deficit.

In az we highlight the cross-cutting support that this law obtained in Congress, which allowed its rapid passage; and we believe it can be a useful tool in the reactivation of the construction sector with the start of new projects, along with facilitating the acquisition of new homes.

To discuss the implications of this new law, please contact our Corporate and Business, Real Estate and Tax teams:

Álvaro Rosenblut | Partner |

David Ancelovici | Director Tax Group |

Juan Pablo Vieira | Associate |

Raimundo Busquet | Associate |

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